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The Impact of Covid19 on the leading online travel agencies

The Impact of Covid19 on the leading online travel agencies

Numerous reports suggest that hotels have seen a swing toward consumers booking direct as lockdown restrictions ease and travel resume.

There are various reasons for this, ranging from the trust that had existed pre-pandemic with brands or consumers visiting websites of hotel properties to learn more about the safety and hygiene protocols being put in place.

Either way, hotels are experiencing a shift to direct bookings that they’ve been desperate to achieve for a long time.

The argument was always around “owning the customer” through the most important phase of the process, namely where they can collect data on the guest and shift them into their own email marketing strategy pre-, during and post-trip.

The problem that they had was concentrated on volumes of bookings that an intermediary – namely an online travel agency, such as,  Expedia, and others- could give them, often high, albeit in return for double-digit rates of commission.

Hotels attempted to break the cycle of reliance on OTAs with varying degrees of success – until now.

Moving forward

The million dollar question (maybe the $12 billion one, given how much both the aforementioned OTAs have spent in the past on digital marketing to bring consumers via their route) is whether the trend will remain in place for longer than the recovery period?

There is an argument that once the recovery process and the so-called “pent-up demand” settles down, then normal service will resume.

The online travel agencies can outspend their “partners” and reposition themselves as the one-stop-shop for all things travel-related, not just the accommodation part of the equation.

The challenge for hotels will be to make sure they do all the hard work now, as the recovery period stretches out over the coming months, perhaps even into 2022.

Creating a new pattern of loyalty with customers will be a crucial part of the guest experience strategy – a process that will take place both online (before and after a trip) and once the stay is actually taking place.

Finding the right balance between direct and indirect bookings has always been an artform that hotels have struggled to achieve, but they have some momentum at the moment and an opportunity to claw back as much ground as they can before the status quo, pre-pandemic, potentially returns once more.

Hotels know that just a few percentage points in their favor towards direct bookings can make a huge difference.

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