June 21, 2018
Travelers losing interest in home-sharing
According to MMGY Global’s Portrait of American Travelers study, just 33% of respondents are interested in sharing economy accommodations, down from 41% in 2017 and 37% in 2016.Read more
If you’d told hotel marketers 20 years ago about the magical world that we live in today, they’d likely tell you that they wouldn’t need to lean on OTAs as heavily as they did back then. And yet, here we are. Hotels are leaning on OTAs more than ever.
Whether you love them or hate them, most people would say that the OTAs have become a dominant force in the industry because of their sheer size and because they have infinitely more resources at their disposal than a single hotel property can ever imagine. Some may also say that OTAs have not helped increase the total volume of travel and therefore have become a totally unnecessary middleman – a middleman that does nothing more than suck the profits of the hotels. The truth is that OTAs arouse out of the ashes of a very broken economy. We were in a major recession, travel was in decline, and hotels were desperate to drive new business. To be fair, at the time, the OTAs probably saved a lot of properties from bankruptcy.
Back then, search engines weren’t nearly as sophisticated and neither were consumers. For years, hotels had relied on aggressive marketing to their existing guest history database for business. They found themselves in a scenario where they needed to drum up an increase in new business and they had limited ability to do that on their own. They had no choice but to turn to their knight in shining armor, the OTAs. But, that was then and this is now.
Fast forward to 2017, and now hotels have the ability to control their own destiny. They have the ability to build a cutting-edge website at the fraction of the cost of only a few years ago. They can put their rates and inventory out for the world to see on hundreds of channels, they can invest in cost-effective and targeted advertising across the entire Internet, and they can build massive social following and huge email databases. Best of all, they can track every penny they spend and figure out exactly what is working and cut the stuff that isn’t.
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