OTA Strategy Project 2012
Project Purpose Fáilte Ireland wanted to address industry demand for more support and information on the OTA channel options for Irish hospitality businesses.
The Comparator
OTA Comparator
Booking Engine Comparator
OTA Comparator
The Research 1. The OTA's In- depth interviews with the top OTA’s in the Irish market 2. Irish Hoteliers Telephone interviews with a mix of hoteliers across Ireland Asked over 400 hoteliers their opinion via an online survey 3. International Research Looked to international research on OTA’s to back up our findings
The OTA's
Putting it all in CONTEXT
Travel Online 71% of all travel research takes place online Ref: Econsultancy Toluna Travel Survey Ref: IPK International, March 2012 50% of all Travel Bookings across Europe are made online
Travel Online Total value of travel bookings in Europe 2011 € 238 billion OTA's make up 37% of this Total value is € 88 billion Ref: PhoCusWright Global Online Travel Review
Mobile Ownership ½ of all customers never visit a travel agent for holiday bookings ½ of Italians booked their accommodation online making it the strongest Ecommerce category Customers prefer to go to a travel agent for more expensive trips yStats.com "Europe Online Travel Report 2012"
OTA Growth 2011 OTA growth – 19% Supplier sites – 9% Ref: PhoCusWright FYI Jan 2012 Main driver of growth in Europe? Booking.com Took 27% of all Gross OTA bookings
OTA Growth
OTA Market Share by Country Europe – 37% (+19% in 2011) China – up 34% in 2011 (expected +45% in 2012) Australia – 34% (+55% in the last 2years) Ref: Traveltrends.biz, China Economic Net
The impact of MOBILE
Smartphone & Tablets
Mobile Ownership By end of 2012: Three out of four Irish will have a Smartphone . Two out of five Irish will have a Tablet device . RedC Report – Connecting the World, Winter 2012
Mobile Bookings Mobile bookings are expected to have TRIPLED by end 2012, with 8% of all mobile users booking via mobile device Ref: Google Travel Report The OTA's we spoke to expect mobile bookings to make up 20-25% of total bookings by the end of 2013
Online booking Channel Game Changers
Google Hotel Finder
Google Hotel Finder
Meta Search Sites
Meta Search Sites
Roomkey Exit Strategy
Roomkey Exit Strategy
The Billboard Effect
Cornell Study 1,720 reservations at IHG websites 75% visited an OTA Ref: Cornell Chris Anderson 83% web search 60% did both
Cornell Study Ave. OTA visit = 1 hour = 90 pages of content 1 OTA booking = 3-9 bookings on hotel website
"OTA's are now publicly projecting their job as complementary to hotels, not competitive . The tension in OTA/hotel relationships – particularly during the recession – are certainly justifiable, but at the core, online intermediaries are meant to be incremental business…”
"…so what does this change for hotels? Nothing really. They still have to continue to remind themselves that they control their inventory , not the OTAs. However, the OTAs taking this consumer-facing initiative will be good for hotels if they are savvy with their rate management and rooms distribution” Dan Marcec, Hotel Interactive, 6th March 2012
What hotels say about OTA's 477 Irish hoteliers were asked their views on the OTA brands they work with in during Dec 2011 - Feb 2012
2.
Breakout Session Tips for dealing with OTA’s
1. Manage your own conversion Today there is less brand loyalty to hotels and to OTA’s. Conversion is between 4-5% on the international OTA websites, so many of the visitors who find you on an OTA may also visit your website. What are you doing to convert them?
2. Reassure Your Website Visitors What is your rate policy between your own site and the OTA’s? What reassurances are you giving your site visitors that they are getting a good deal? Can they cancel? Then tell them!!
3. Make sure you are on the correct OTA’s What are your top customer markets and what OTA’s do they use? Ask the OTA’s you work with what nationalities are booking Irish hotels? Within the main OTA’s that we researched the the top nationalities booking varies hugely - you need to work with at least 3 of them to get good access to the main international markets.
4. Match OTA terms Match the deposit and cancellation policies of your top OTA’s
5. Understand the OTA Customer Load rates and availability strategically with your OTA’s to ensure they have rates loaded far enough in advance For example: one site 16% are booking +60 days out & 10% are booking on the day – have you both bases covered?
6. Create Excellent Content OTA’s say conversion by property on their sites can be +/- 3% based on the quality of the information and photos available Some OTA’s them will offer you a copywriting service, but for others you must give them all the copy, so make sure you know how to ‘write for the web’. You should have a min. of 20 good quality, relevant photos loaded with the OTA’s. Make sure you put time into making your content great!
7. Understand the Algorithim The OTA’s work on an algorithm to plan their property rankings. These algorithmic are equations that may take into account all or some of the following: - Price competitiveness - Promotional rates - Conversion rate - No. of cancellations - Location (ie: distance to the search) - Number and quality of photos - Quality of the hotel description - Ave. review score
8. Get Mobile Expedia say that expect 20% of all their bookings to take place on mobile platforms (Smart phones and tablets) by 2015. You need to consider what impact this will have on lead times, rates and offers booked, and your own mobile website.
9. Manage Your OTA Relationships When working with OTA’s its not just about loading up the same rates as you have on your site for the coming months, you need to make sure you have the following loaded (where applicable): - Seasonal offers - Last minute offers - Advanced purchase rates - Multi night discount - All room types If you work through a channel manager, make sure you don’t leave the machine to do the work! Several of the sites mentioned that the hotels that work closely with them tend to be invited to participate in additional Marketing campaigns across the site, social media and newsletters
10. Don’t let the Channel Manager to all the work OTA’s reported that hotels sometimes get lazy when they have a Channel Manager. You need to flex your rates and manage your availability and room types in order to get the most out of your OTA’s
Thank YOU
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