Hotels Leverage BI to Target OTA Shoppers

How Hotels Can Survive and Thrive OTA Mega-Mergers

OTA Mega Mergers

A recent study by HVS titled ‘OTAs – A Hotel’s Friend or Foe’ may instill some anxiety among hoteliers as they are busy looking ahead at the 2016 budget planning. The report cites that with the recent acquisitions of Travelocity and Orbitz, Expedia and Priceline have now secured positions as the two most powerful OTAs. This leaves us to wonder if hoteliers have no choice but to increase our dependency on OTAs with limited leverage to negotiate on such issues as commissions and rate parity. Add to this the growing number of OTAs entering the loyalty program sector, some may fear they are losing their unique selling advantage.

However, defeat and despair does not have to prevail. Savvy hoteliers will look at this news as an opportunity to reinvent their relationships with both third-party suppliers and their hotel guests. The key to regaining this control lies in focusing on three main areas, diversification, negotiation, and targeting.


1 – Diversification

The most significant impact of the acquisition is that suppliers are going to be dealing with fewer players. Simply put, this means it becomes increasingly important for hotel and management companies that contract with OTAs to diversify their sources of distribution.

Three players are quickly gaining momentum in the non- brand.com booking channel game.

TripAdvisor’s powerful new TripConnect™ tool that has been rolling out this past year creates a powerful and seamless new experience that allows travelers to research, choose and immediately book on the world’s largest travel site.

Simultaneously Google has quietly added instant booking for hotels, replicating Tripadvisor. According to an article by Tnooz, though assisted booking by the metasearch giant hasn’t been officially announced, it has been rolling out slowly across the U.S.

Finally, do not underestimate the power of Amazon. Skift recently ran a story by Dennis Schall about Amazon Travel. The article claims that OTA giants like Booking.com and Expedia are not concerned with at the might of Amazon. However, it won’t be long before they will be focused on the impact of the expanded Amazon Destinations, as will the folks at Google and TripAdvisor.


2 – Negotiation

Now this is not to say that its business as usual with Expedia and Priceline with no changes to terms. Remember you do have options and you can negotiate your terms. Of course this is a more viable alternative for brands and properties with a certain amount of clout, however, do not rule out trying if you are a smaller brand or independent.

You might not get a reduction in fees, but if you work closely and communicate with your market manager to look for value adds like sponsored listings, display discounts and other ways to make your spend more effective.


3 – Targeting

Eliminating third-party bookings we know is not the solution, however creating a better balance between OTA bookings and direct should be a priority. One of the ways this can be achieved is by creating a harmonious alliance between marketing and revenue management. Too often we see these departments working autonomously where combining the data and knowledge from both disciplines can accelerate increases in your direct bookings.

It starts with knowing who your customers are, where they are shopping and then targeting them with the right message and offerings. We can quickly identify tactics that have proven ROI such as PPC, display ads, email marketing and social media, but that doesn’t expose the identity of who your customer is.

Fortunately for hoteliers there is an available solution. nSight aggregates millions of consumer “looks and books” from travel websites every day. This provides an unprecedented view into online consumer search and buying behavior.

Leveraging this new predictive data, disruptive hotel digital marketing includes these strategies:

  • Targeting active shoppers, not past buyers
  • Lead times (search-to-book and book-to-stay – these metrics vary by source market, destination, consumer profile and season)
  • Personalization of messaging and images to consumer profiles most likely to book (source market where consumers live, what type of consumer profile they fall into such as Baby Boomers, Millennials, etc.)
  • Scheduling ads based on consumer lead times that vary by source, destination and persona arrival dates (next 30/60/90 days, weekend or weekday, etc.)

Understanding predictable buying behavior as it relates to hotel bookings provides a solid foundation to incorporate a strategic direct business plan to win back the loyalty of your hotel guest.

 

As you work on the 2016 budgets do not forget to:

  • Diversify – Investigate other distribution partner booking options such as Tripadvisor
  • Negotiate – Set up a meeting with your Market Manager for perks and discounts
  • Target – Strengthen your direct bookings strategy by using data intelligence to identify and convert active OTA shoppers

 

To see how predictive marketing can improve position against the OTAs, hotels can try a 60-day free trial of nSight data.