Is your hotel rate floating around the internet with no control?
Sometimes it feels as though your rate is circulating online without any control, especially now that metasearch sites such as Trivago, Skyscanner and HotelsCombined let guests search for the best price across the web in a single query.
Here are ten reasons to consider reducing your distribution partners and regaining rate parity.
1. You are undercutting your public rate
Suppliers bid on OTAs by offering higher commissions. The higher the commission and the better the public rate conditions, the more often they will appear. In reality, this is a volume sales channel: sometimes the supplier earns less than 1% on each booking, or even makes a loss if it is close to a rebate threshold.
2. It is not your battle
Once you have set a mandatory public rate, regardless of each supplier’s terms, it should no longer be your problem. Even so, you will receive countless calls with excuses such as: “So-and-so is offering a net rate of X—why can’t I?” or “There’s no way I can sell at that price.”
3. You will waste time checking rate disparities
Some OTAs make it easy to identify the supplier, but others, such as Amoma or Destinia, require you to enter credit card details before revealing the rate.
4. You will waste time matching prices for guests
The “best price guarantee” badge on your website looks good, but in some cases it may not be worth it. It frustrates the reservations team and can turn into a tug-of-war between the guest and the agent. If you offer a best price guarantee, give your reservations agents the authority to make a decision without having to pass it through several layers of approval.
5. Contract directly with OTAs
Some OTAs allow you to contract with them directly. If their terms are good and you reduce the number of intermediaries, your public rate will benefit.
6. You will reduce billing errors
The more contracts you have, the more likely you are to encounter errors—whether related to commission, payment method or something else.
7. Many suppliers offer the same thing
You will still appear on OTAs, since many of them source prices from the same places. But with fewer suppliers, competition will be lower and they will not be forced to cut your public rate.
8. It will be easier to identify suppliers
With fewer suppliers, you will have an easier time identifying those who are not respecting your rates.
9. You will regain control of negotiations
Your product will be available to fewer partners, which gives you more room to negotiate better terms for an almost exclusive product.
10. You will increase direct sales
Guests may fail to complete a booking on the hotel website for many reasons, but one of the main ones is finding a lower price on an OTA.