Can’t live with ’em. Can’t live without ’em. The relationship between online travel agencies and hotels is a turbulent tale. First, OTAs show up like a blind date and whisk us off our feet. Before we know it, we’re living together and sharing finances. Despite hoteliers’ reluctance, it’s obvious that this relationship is long term. Now that it's a mature marriage, it’s time to take a look at the give-and-take between the two sides. From the editors of HotelNewsNow.com, we bring you an in-depth exploration of many aspects of the issue: channel management, booking behavior, data issues and how the relationship has hurt and helped hoteliers.
OTAs how do we love thee? Let us count the ways... More
Merchant website: Third-party distributor where the hotel provides inventory to the site at a net rate. The merchant marks up the rate by an agreed-upon percentage. The consumer pays the merchant at the gross rate and the merchant site pays the hotel the net rate (e.g. Expedia, Hotels.com, Travelocity, Orbitz)
Opaque website: Third-party distributor that enables customers to choose a fare or rate without knowing the brand of the supplier until after the item is purchased (e.g. Priceline, Hotwire)
It's enough to strike fear into the hearts of OTAs worldwide--if Google enters the hotel booking game what will the resulting merchant landscape look like? Forget about it, because that scenario is unlikely, according to industry experts. More
Brand website: Website where distribution is operated and managed by the brand (aka “brand.com,” the direct booking channel)
Retail website: Third-party distributor where the hotel lists inventory at the same price that it is sold to the consumer and hotel pays distributor agreed-upon commission (e.g. HRS, Bookings, Venere) Source: TravelClick
Interesting and thought-provoking article. The problem with OTAs is that they work in a monopolistic manner. Large OTAs disregard the guests as well as hoteliers and only seek their own profit. We need to change this mentality of relying solely on these huge OTAs. Small start-ups have started to penetrate the industry reolvutionizing the markets.
Check out Bidroom, for example. They ask only 2% commission (the lowest in the industry) and guarantee 5% discount on all the hotel rooms. They want to revolutionize the industry. They work IN FAVOR of hotels, not against them.
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