How Are Online Travel Agencies Affecting The Hotel & Holiday Accommodation Industry

How Are Online Travel Agencies Affecting The Hotel & Holiday Accommodation Industry

Should you have planned and booked some accommodation online, be it for just a vacation or business trip, you will surely have come all over some Online Travel Agencies (OTA’s), for example , companies including Agoda, Trip Advisor, Expedia & Booking. com. These kind of OTA’s have been around since the late 90’s and early 3, 000’s and each year they have been growing in size, strength and popularity, so much so that in today’s online market you literally essentially are unable to avoid them when you are booking any kind of travelling arrangements online; anything from hotels, villas & rooms to cars and trucks & bikes and also flights – You will always view a handful of OTA’s on the first page of Google benefits and also dominating Google Adspace positions. Of course with the grow of this monster sized travel agencies, there has been a persisted growing concern coming from Hotel owners, Car Rental companies along with businesses that need to capture more direct bookings to avoid staying totally or almost completely reliant on third party booking portals. The reason for the concern of course if because of the profit decline that the businesses have to take on when receiving their bookings from booking agents rather than directly from the consumers; quotes do slightly vary from each agency, although it is never getting so small a % that it doesn’t have a noticeable affect on the providers ‘bottom-line’. Hotel and property owners for example are necessary to pay anywhere from 15-35% commissions to the OTA’s for any reservations received, the % value is usually dependent on the location with the property/hotel and also on the number of rooms they have listed from the OTA (the more rooms they list, the lower often the % commission they will have to pay to the OTA).

With this significant expense that comes from partnering with OTA’s, you might think to yourself, ‘why do the Hotels & Resorts continue to make use of the third party booking agents when they could be enjoying a greater profit margins from capturing direct bookings? ‘ this is an issue that all accommodation providers will have considered and pondered in order to themselves & discussed with their teams and the answer multi level marketing that most of them now are in a position where they just can’t live without the OTA bookings. Unless the Hotel as well as Resort is one that has on its own gained so much notoriety and is particularly so popular that they can successfully fill their rooms all year all around, then it is a case of having to join up with an OTA or a few so that they can survive. Actually even with the notorious and popular hotels and resorts I am referring to, we will see low seasons and other times and occasions when reserving numbers will be low and a need for additional exposure to raise up room/villa bookings will arise; so in reality partnering together with the OTA’s is now a necessity for all companies that are in the trip accommodation business.

Where Did These OTA’s Come From along with Who Owns Them?

When talking about OTA’s most people will be picturing a handful of companies, who are really the main ‘big players’ that contain extremely aggressive marketing activities to ensure that pretty much all visitors will frequently see their brands & promotions, both on the internet & in offline locations. The four most well-known OTA’s are Expedia, TripAdvisor, Agoda & Booking. com; these are definitely room booking platforms that are creating the biggest shift already in the market and the ones that will be on most Hotel owners list for partnering with. Out of these four agencies, the oldest a couple are Expedia which was formed by a small department inside of Microsoft back in 1996, and then Booking. com that started in Amsterdam also in 1996. Trip Advisor came future in the year 2000, formed out of a small office in Ma, USA and last but not least came Agoda, formed in 2002 and originating from Bangkok, Thailand. In actual fact, nearly all the main OTA’s and online booking platforms are now owned by in addition to come under the umbrella of only two main, huge sized organizations; Expedia Inc is one and the other is a Priceline Group.

So to answer the original question of this write-up which was asking how the OTA’s are affecting the holiday accommodation booking industry; for the consumer it is really just making all of accommodations more accessible and the user experience has been greatly superior with it being much easier and more efficient to compare different destinations. Also having the additional benefit of being able to check out reviews of place prior to making any booking is another positive adjust that the consumers can enjoy. For the accommodation providers on the other hand, these have had some negative effects and also some positive. The revenue and additional costs for better placed listings within the OTA websites heavily eats into the profits that can be made by the home or property owners, but on the other hand for many hotels, resorts and other lodging providers, having the exposure that they get from listing within the OTA websites means that they are now able to get many more rooms booked as well as their brand/location is put ‘on the map’ so to speak, and as long as they provide good rooms at a excellent price, with an efficient service, then they will be able to grow after a while because of the support they receive from their OTA partners. Reservations.com is an online hotel booking platform that helps travelers with room reservations, car rentals, and group booking services. The platform offers end-to-end solutions for solo travelers, families and corporate travelers through its 250,000 hotel partnerships across 5,000 key global destinations.