OTA’s (Online Travel Agencies) require no introduction as it has completely revolutionized the hospitality industry. Just like Oxygen is to man, similarly, OTA is to hospitality providers. It is amazing to see what started off as a platform for selling excess inventory when demand was low, has grown leaps and bounds to dominate the entire booking process.

At present almost all reservations across the world are made via these online platforms. Hence, it is a must-have component that all accommodation providers have included in their distribution strategies. 

Most of you readers who are involved in the hospitality industry are already aware of what an OTA is. However, few have a rough idea as to what it is so do not worry because you will get a full understanding of it shortly.

An OTA is a web-based marketplace where customers can find out about travel-related products and services showcased by a large variety of accommodation providers. These products and services include hotels, flights, cars, tours, cruises, activities, and more.

Often many misunderstand that they need to have more OTAs under their belt, which is not the case always. As a tourism operator, you need to give more priority to quality than quantity. The best practice would be to have several OTAs in your arsenal but make sure that you don’t overload yourself with them.

Yes, it is true that OTAs are a powerful tool that slingshots booking to a whole new level, but we don’t fully realize its true power until we see numbers start to talk. In 2016, TripAdvisor had 1.1 billion visits to its site. Moreover, 76% of online bookings happen via OTAs, out of which 20% of direct bookings arrive from customers who have discovered your hotel via an OTA.

As amazing as it sounds, you need to be extremely careful in choosing the ideal OTA for your hotel. Not to worry, we have come up with 5 factors that you need to take into account when choosing an OTA that smoothly aligns with your business.

1. Target Audience

Different hospitality providers have different target markets, and similarly, OTAs also cater to different geographical locations or regions or to the mass audience as well. So as a hospitality provider, you should be smart enough to partner with an OTA that aligns with your target market. This way you will be able to get more out of the partnership.

For instance, platforms like Gomio and Hostelworld are not the best-suited distribution channels for boutique properties. Vacation rental-based platforms like Airbnb wouldn’t do any justice to a hotel chain. The big-league players like Expedia and Booking.com cater to the whole world while other booking platforms like Trip.com  are only focused on targeting specific regions.

2. Experience

When choosing your ideal OTA check how long they have been in the market of your interest, whether they have a strong history of serving properties similar to your capacity and how many bookings do they facilitate. Never take a chance with a brand new OTA regardless of appealing they are. Instead, it is recommended that you go ahead with a reputable OTA that has a demonstrable history of success. 

3. Commission

Different OTAs have different commission rates and some may charge overwhelmingly large commission rates. However, the worth of an OTA can be determined by considering the Customer Lifetime Value (CLV) of visitors which the particular OTA in question had attracted. 

After your analysis, if the OTA seems like a good match for your target audience or if it has a high chance of bringing in visitors who have high spending capacity, then it is worthwhile to pay a slightly high commission rate and go ahead with it.

4. Features

All OTA’s are not built in the same way instead some may provide specific rate management and listing features that you may not find in other OTAs. However, there is one very important thing that you need to do, which is to check whether the OTA of your choice is compatible with the channel manager.

Any change to availability made via an OTA or on your property management system should update automatically. Refrain from any situation that requires you to insert inventory changes manually because it’s a waste of time and it could cause overbookings as well.

While you are searching for useful features make sure that the OTA in question is intuitive and accessible to your visitors. 

5. The type of property you have

All OTAs are not suitable for all types of properties. Choosing the ideal OTA is based on the category of your property and the services that you provide, hence, the OTA which you are going to choose may vary too. 

For example, Expedia is better suited to sell 5-star listings and luxury rooms, whereas, Hostelworld is one of the best platforms to sell budget rooms and hostels. Moreover, properties that belong to the bed & breakfast category are suitable for Verbo.

We have done numerous third-party integrations including integrating OTAs to tourism-based websites. We are always ready to provide our full support regardless of what OTA you choose so don’t worry about taking your own time to hunt down the right OTA.

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