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Driving direct sales through revenue management: how to compete with the OTAs

The dominance of Online Travel Agents

Online Travel Agents (OTAs) are now ubiquitous in hotel booking and are generating huge profits. OTAs have been continuing to increase their share of online bookings and the leading OTAs have continued to buy out rivals, leaving genuine corporate behemoths at the helm of online hotel booking. They have sophisticated and accessible websites, with a huge marketing presence; they appear at the top of search engine lists for any hotel, in any city, at any time. As their commercial power has grown, commissions have increased creating a tangible challenge for hoteliers and Revenue Managers. Despite the challenge, there are a number of Revenue Management Strategies that can help generate direct bookings and side-step the dominant OTAs.

Strategies for Driving Direct Sales

The first step is to get advice. Outsourced Revenue Management can help put in place the strategies needed to increase direct sales. There are a multitude of approaches that can be taken by Revenue Managers, but broadly speaking there are two main avenues of focus: visibility and website performance. These strategies are two sides of the same coin and must work in tandem for maximum effect.

In terms of visibility, it is important to be seen: customers need to know you are there. Getting on board with digital marketing is a must. Revenue Managers can help with getting the right digital marketing in place. Having a website with strong search engine optimization (SEO), keywords, meta tags and descriptions. Use social media channels to drive traffic to the site. Update the site with relevant blogs, with unique information about the hotel, underpinned by SEO and digital marketing strategies. Be engaged with the customer base, responding to positive and negative reviews alike. Contact the customer base directly with targeted emails, advertising best rates. Using Revenue Management Strategies to engage with customers directly, can present unique aspects of the hotel and offer a contrast to the one-size-fits-all approach of the OTAs.

Increasing Direct Bookings

Improving online visibility is only half of the strategy for Revenue Managers. Returning to the other side of the coin, it is important that once a customer gets to the website that it is optimized to drive direct bookings: there is little point working hard to drive customers to an inadequate site. Revenue Managers have the expertise to advise on how the website must be optimized to drive direct sales. Revenue Management Strategies should focus on a logical and intuitive functionality and a strong presentation. The site should be mobile friendly, with clear call to actions and a strong presence for buy-now buttons. Show clear photos of rooms, communal areas, restaurants and other amenities. The website must appear professional and trustworthy: once you have captured a customer, do not give them an excuse to return to the OTAs

This is a brief overview of how Hotel Revenue Management strategies can help and future blogs will look at the issues of social media, website performance and customer profiling in more detail. Revenue Management Training is available from Octopus Revenue to learn more about the strategies needed to drive direct bookings.

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