Why the online bookings power shift is more manageable than hotels think

Online distribution is growing at a faster pace than the entire travel market. The American Hotel and Lodging Association (AHLA) estimates 480 online bookings are made every minute, across the US, alone. It’s a fascinating statistic that emphatically demonstrates how much the hotel industry has changed over recent years.

We know more people are travelling than ever before. Figures from the UN World Tourism Organisation show that in 2014 the number of people travelling internationally reached 1.14 billion – and it forecasts growth of around 4% during 2015.

This heightened desire to travel and see parts of the world that 25 years ago would have been considered out of reach, and of course too costly, has been spurred on by the Internet economy, the desire for experiences once reserved for the elite, and the sheer volume of information that’s available to travellers making it more accessible.

But if we dig deeper into this observation, the broad accessibility of information isn’t just changing a handful of travel industry trends, it’s completely shifting the balance of power – from a consumer economy with intermediaries, to a user economy with “self-service”.

The consumer economy is now a user economy

Travel knowledge and information used to lie in bricks and mortar, dominated by brands and agencies, renowned for delivering an expertise that could be rarely challenged.

But the Internet has caused a tipping point to occur enabling hotels to sell themselves to potential guests who appear to know precisely what they want, and the research they need to carry out in order to make their travel aspirations a reality.

Everything from photos through to guest reviews are creating information overload, as user generated content becomes a critical variable in the consumer’s battle for power. In the early days, travel agents and experts influenced consumers with experience and brochures illustrating what was available. Later OTAs, and especially Booking.com, revolutionised this idea of putting the traveller in control by providing more content and information available at their fingertips. Now we see the user economy taking control with the growth and development of Airbnb, Uber, Flip.to, and many others enabling self-selection.

Travellers can have an authentic experience of living like a local, in the neighbourhood, visiting their host’s local favourites – and quite often at a fraction of the price. Travellers are willing to transact beyond hotel rooms, and as a result guests are becoming more efficient at making their final booking decisions.

The new doesn’t always replace the old

After 26 years in the hotel and travel industry, I’d like to think that the old (or perhaps mature…) can continue to be relevant. And it is.

Many travellers still rely on the services of travel agents – in fact research shows that in 2014 18% of American travellers used traditional travel agents, compared with 12% in 2013.

Global distribution systems (GDSs), which have been around for decades, continue to service a huge volume of travel and accommodation bookings – an estimated 62 million in 2015 –demonstrating the staying power of expert advice from travel agents and wholesalers with enhanced networks and online tools.

That said, there are always going to be new brands or industry challenges that force hoteliers to stay fresh and on top of their game. That’s nothing new and it will always evolve. For hoteliers, it’s a question of managing and adapting to those changes. It’s evolution, not revolution.

The bookings gauntlet has been thrown down

Hoteliers must think global and act local in order to capitalise on the guest’s winding path to purchase. We live in a multi-screen world, with many points of conversion, and it’s important to remember that rate is not the prime decision tool. Yes, price is a big differentiator when assessing the challenge presented by the likes of Airbnb, but there are many more factors to consider. Hoteliers can take on the challenge in many ways. One example is to become more service-orientated, focusing on the elements of a hotel that home-sharing can’t offer – such as tour guides, chauffeured drivers, dry cleaning, restaurants, gyms and a bounty of amenities and loyalty points.

By offering an extraordinary guest experience hoteliers can really capitalise on the impact of user generated content – reviews, social media check-ins, comments, ratings – and in turn use these positive affirmations to drive bookings.

A hotel’s biggest weapon in the fight for bookings is knowing the business mix inside out. Ask where your bookings are coming from. Ask what your local competition is doing to fill their rooms. Ask how you are driving your online and offline business.

It is truly all about the details.

Hoteliers need to find balance and control of how your rooms are being distributed. Take charge of your bookings mix and ultimately your business.

Cloud technology, is levelling the playing field for independent hotels, helping them compete in a fast-changing market. It gives hotels of any size the power to be exactly where prospective travellers are – without the need to invest heavily in IT and systems providing more time for creativity and caring for your guests.

The multi-channel, multi-screen world is now completely accessible, giving hoteliers greater opportunity to reach, attract, and convert global guests. Chain hotels have been doing this for years, reaping the benefits of having a visible online presence to ensure they turn lookers into bookers. It’s time for independents to take charge, challenge the status quo, and compete in the same way.

5 tips for independent hotels to drive greater efficiencies

Independent hoteliers need to devise strategies to gain more business, more efficiently, in order to out-pace and out-perform competitors. In particular, the digital experience is pivotal for today’s independent hotelier, as more travellers turn to mobile devices and online platforms, including social media and IBEs, to make bookings.

As travel brands and consumers continue to interact online as well as offline, here’s a look at 5 ways independent hotels can drive greater efficiencies.

1. Better website performance to drive conversion

Independent hotels need to optimise their website with clear call-to-actions and rich local content in order to maximise engagement with their website visitors. For instance, by using cloud technology to create a fully integrated booking experience on your website, you can:

Create a clear path through the booking process with a minimum of clicks.
Reach international travellers with offers in multiple languages and currencies.
Make your deals and special promotions more visible on your website.
Up-sell with value-added extras (breakfast, late check-out, etc).
Along with clear call-to-actions on your website, having high-quality, SEO-optimised content will improve your search engine rankings and strengthen your value proposition in the marketplace. By focusing on strengthening your web presence, you can increase your level of conversions and revenues through direct bookings.

2. Digital platforms across all devices

Travellers need to access data on the move, whether it is via smartphone, tablet, or laptop. And with mobile bookings expected to exceed one-third of all online bookings by 2018, it’s essential for independent hoteliers to maintain a strong digital presence across a variety of devices.

In a move to capture more of the lucrative mobile market, travel brands like TripAdvisor, Expedia and Booking.com have developed key strategies for mobile platforms. Independent hotels need to follow suit with custom apps that help target and bring in more direct customers. For example, Choice Hotels Book Now! app utilises smartphones’ built-in GPS capabilities to allow travellers to locate over 5,800 properties worldwide, book automatically using previously stored credit card information, and rack up rewards in the process.

3. Pricing

To stay competitive in the transparent booking landscape, independent hotels need to review and re-optimise their pricing regularly. As a case in point, online retailer Amazon makes more than 2.5 million price changes every day in order to provide the most competitive pricing on the web.

Hotels must adopt the same mentality when it comes to pricing, by constantly monitoring competitors’ prices and adjusting their room prices accordingly to maximise revenue per room. Using a revenue management system (RMS) with dynamic pricing capabilities, you can track your competitors’ pricing and, within your specified parameters, adjust prices on your OTAs and meta-search engines automatically with your channel manager – helping you stay one step ahead of the competition.

4. Push pricing updates across all distribution channels

Airbnb is a prime example of a company that has solved the puzzle of predictive pricing for its customers who often have trouble correctly pricing their rooms. Integrating the basic question of “How do I price my room?” within their pricing algorithms, Airbnb’s pricing suggestions take into account a variety of factors including the type of room, the local neighbourhood (value), and nearby amenities. As their experiments revealed, users that chose to use the suggested prices got three times as many bookings as those who did not. Clearly, better pricing intelligence drives more bookings.

Using your channel manager as part of a cloud-based product suite, you can ensure that your best rates and current room availability are automatically updated in real-time across all your booking channels including OTAs, GDS, wholesalers, travel agents, and your own website – saving you time while you maximise your revenue per room.

5. Provide more incentives to book

Guests that frequent independent hotels will fall into the category of a one-time visit, a regular guest, or an advocate who provides positive word-of-mouth to drive more direct business. But regardless of which category they fall into, guests need incentives to stay again or recommend your hotel and its benefits when booking directly.

For example, complimentary free upgrades, free food and drinks, and redeemable vouchers for local restaurants in exchange for booking direct through your website are just a few incentives that will encourage return visits. Using your social media channels, you can convert more customers with special offers and booking buttons that lead them directly to your website.

When it comes to driving greater efficiencies, hoteliers must make use of all options available, both online and off. By offering more streamlined direct booking options on your website, mobile booking apps, along with competitive pricing and incentives – your hotel will be well-positioned to capture its share of the independent hotel market.

7 reasons your staff need the help of a channel manager

Across the hospitality and travel industry, technology continues to transform the way people do business.

If your property is not adapting with the times, chances are you will be left in the dust as your competitors capture the most motivated and interested travellers from across the globe.

One system that is absolutely essential is a channel manager. Here are 7 reasons why your hotel needs the help of this technology.

1. It will increase your online bookings

Skift recently released a report, that noted an 8% decrease in telephone bookings for hotels, while online bookings increased by more than 7%.

It’s clear that online bookings are the future and a channel manager will put your hotel in the best place to accept online bookings from all the distribution channels your hotel connects to online.

2. It can improve your brand recognition online

Through a robust channel manager, hundreds of online travel agencies (OTAs) will want to partner with you because your inventory is that much more accurate.

In turn, you will have access to a multitude of guests looking to book rooms online.

The end result is that your visibility and recognition improves amongst both agents and travellers.

3. It will boost direct bookings

While many people think of a channel manager as a great way to connect with the all-powerful OTAs, it also can increase your direct bookings.

Your guests may research various hotel options on an OTA site, but once they discover your brand, they will head to your website in order to finalise their booking. This is what’s known as ‘The Billboard Effect’.

4. It virtually eliminates the risk of overbookings and double bookings

A diverse and eclectic distribution network is necessary in order to maximise your bookings and sell as many rooms as possible.

The only way to partner with as many agents as possible – without the risk of overbooking or double-bookings – is through a channel manager.

A channel manager automates availability, rates, and inventory updates in real-time, so guests can only book rooms that are actually available.

5. It means you no longer have to update your inventory manually

Your staff don’t have to deal with the time-consuming task of manually updating your inventory.

When a room is booked, your inventory is automatically updated across your entire distribution network as well as your own website.

6. It unifies your other systems

A modern channel manager will be able to integrate with your existing property management system, central reservation system, or revenue management system – allowing you to have one central hub for all of your hotel’s operations.

Such real-time integrations keep everything in sync and lower your cost of acquisition. They connect your hotel synergistically to all the systems needed to drive revenue, processing everything from reservations and guest information to check-in and check-out times.

You can then use your channel manager data to adjust your strategy accordingly – reduce availability, close out rooms, or increase rates on the channels that generate the least revenue – in favour of those that are more profitable.

7. The proof is in the pudding

Many hotels that have adopted channel managers are reaping the benefits of increased productivity and revenue.

Online Hotel Distribution: Why you should connect your hotel with a channel manager

If you are wasting too many hours of your day posting hotel availability information and current rates on various extranets, then this post is for you.

Here’s why it’s time to implement a channel manager for your hotel.

You do not rely too heavily on traditional booking channels.

It’s important to diversify your distribution channels so that you aren’t relying too heavily on one source of bookings. And online bookings and mobile bookings are on the rise, while telephone bookings are quickly declining across the globe.

So when you put all of your efforts and resources into several traditional booking channels, such as telephone leads, email inquiries and print advertising, you are missing out on revenue from guests who primarily book online.

Through a channel manager, you have access to an infinite number of agents who are willing to book your rooms based on your live availability and current rates.

You can integrate it with your direct booking engine.

Any business in the travel and tourism industry needs to have a direct booking engine in order to survive.

When you invest in a commission-free booking engine with a channel manager, you can boost your direct bookings while also connecting with agents throughout the industry who are interested in your products.

Since the booking engine should be commission-free, your direct bookings result in higher profits and increased revenue for your hotel.

While you may need to partner with OTAs via the channel manager in order to attract certain types of customers, you will begin to earn more direct bookings as customers discover your brand on their own.

You can auto-magically manage your booking channels.

There is no task more tedious than manually updating each booking channel that you use, and manual updates also leave you at risk for overbooking your rooms on any given day.

With a channel manager, all of your booking channels are instantly updated when someone makes a reservation. The guests booking through the channels connected to your channel manager constantly have access to your live availability and current rates, which ensures that you receive the most bookings without overselling your rooms.

This alone will save you valuable time on administrative tasks. You will be able to focus your efforts on more important, long-term projects, such as your social media strategy or your online distribution plan.

It becomes a powerful business platform.

A modern channel manager will be able to integrate with your existing property management system, central reservation system, or revenue management system – allowing you to have one central hub for all of your hotel’s operations.

Such real-time integrations keep everything in sync and lower your cost of acquisition. They connect your hotel synergistically to all the systems needed to drive revenue, processing everything from reservations and guest information to check-in and check-out times.

You can then use your channel manager data to adjust your strategy accordingly – reduce availability, close out rooms, or increase rates on the channels that generate the least revenue – in favour of those that are more profitable.

Online reviews and the importance of managing them at your hotel

For hotels to sustain a profitable revenue stream there are many factors they must maintain. One of those is their online presence and reputation – and the clearest indicator of a hotel’s reputation is often found in online reviews.

Review websites such as TripAdvisor and Yelp can have a significant impact on how travellers choose their accommodation. Most of the time, the general consensus is what people will accept so it’s vital that your hotel has a reputation for quality service and professional standards. A recent Barclays study reveals there is an extra £3.2 billion to be earned over the next decade if the hotel sector becomes more attentive to online reviews.

It’s important to remember that just because you are a three-star hotel, it doesn’t mean your reviews will be rated lower than those of a five-star hotel. People balance their reviews with their expectations so ratings often even themselves out across all hotels. This is reflected in recent research that showed just a 0.74 ratings gap between two-and-a-half star hotels and five-star hotels.

It might be easy to say managing online reviews is too time-consuming to be bothered with and that it won’t make any difference to the overall success of your property. This couldn’t be further from the truth. In fact, it’s becoming more important as time goes by

2017 hotel and travel industry trend predictions

It’s highly likely that the emerging trends we’ve discovered in the past year or two will continue on the upward curve in 2017.

Online bookings look destined to shape the market, with OTAs ready to grow market share as hotels look to balance that with direct bookings.

Here’s the fine print…

1. OTAs vs direct bookings

Even though OTAs do enjoy as much as 52% of the market in the US and 70% of online bookings in Europe originated with an OTA search, there are signs direct bookings may rise in 2017. With a curb of rate parity clauses underway, direct bookings are predicted to rise in Europe. Phocuswright  report a 2% increase in France and 3% in Germany, while OTA bookings are presumed to fall by 2% and 4% respectively. Hotels can further bolster this growth by attracting guests with special rates, extras, and loyalty rewards.

2. Bleisure travel

Some say it’s one of the most exciting segments in the market right now – the business traveller who extends their stay to take in some sights and relax before they head home. Business travel saw solid growth in 2016 and it should continue, meaning hotels can target more of these types of guests. A common incentive for a guest to stay longer is offering them the same rate (or lower) on the weekend as they paid during their business trip, as well as tailoring amenities and services to suit their guests if the hotel is based in a metropolitan area.

3. Websites and content

Hotels are realising the importance of mobile and SEO-optimised websites as a top-three concern for the success of their business. It’s not just the beautiful, functional design and SEO that you get from a professional website builder which is important, the content you produce yourself is also vital. As Google continues to refine its search rankings, fresh, quality content will become even more important for hotels if they want to keep the eye of potential guests.

4. Social media

Just like the former, social media is becoming a huge consideration for hotels looking to attract guests and convert them into direct bookings. Traveller inspiration from social media is increasing with platforms like Instagram and Facebook as a quick and easy resource for people to get information and fuel the desire to travel. Hoteliers understand this could be a potentially very affordable way of driving global traffic to their property. A recent survey in Thailand had hotels list social media as the most important factor to consider for future investment.

5. Technology

Very soon, no hotel business will be able to survive with implementing the latest technology into their business strategy. Be it revenue management technology, channel management, booking engines, or websites, guests are expecting the best – and your competitors are using the best – so any hotel that falls behind will be left behind. Virtual technology looks to be the biggest mover, with many hotels now offering virtual tours to amplify the guest experience on the path to purchase. You can expect more of a hotel budget to go towards the latest releases in this sphere as travellers expect more and embrace the notion of exploring places they can’t physically reach and research in person. Other funky technology like voice responsive searchand chatbots are in the works to make travel planning even easier in the future.

6. Apps and mobile

It goes without saying that mobile will develop a domination in booking behaviour before too long. An extension of that is mobile apps which are seeking to complement traditional travel agents and guides. Two extremely useful apps already available among many are Google’s ‘Trips’ and Booking.com’s ‘Experiences’. There’s no doubt 2017 will see an explosion of more of these, giving travellers simpler and faster ways to access information and organise their itineraries.

7. Domestic tourism

In the past, extravagant overseas journeys were all the rage but local travel is starting to turn it back around. Domestic tourism in the UK has been predicted to rise 25% in a four-year period by the time 2017 arrives. It’s a surge that will total £108 billion.

8. Global discrepancies

Some global markets are expected to perform better than others in 2017. The US market is predicted to grow six times faster than Europe, with a higher percentage of bookings made online. Chain hotels will see a three-times faster growth acceleration than independent hotels. However, savvy hoteliers can level the playing field by investing in technology solutions that will deliver better distribution, more bookings, real-time intelligence, and the flexibility to make smarter decisions.