THE average booking values derived from hotel websites are nearly double that found on third-party booking channels such as OTAs and metasearch engines.
Research conducted by hotel booking solutions provider SiteMinder revealed that the average reservation made on indirect channels amounted to US$340 over a 12-month period ending June 2016. Over the same period, the average cost of bookings made on direct sites was US$600.
According to Mike Ford, managing director of SiteMinder, the finding means that hotels should be investing heavily in ensuring they have a balanced approach to distribution with a focus on direct booking strategies in order to maximise direct conversions and therefore profit.
“Our data shows that hotels globally are achieving 1.8 times more, on average, for accommodation booked via their own direct website than via OTAs and other third-party channels,” said Ford.
“While we can’t forget the reach these third-party sites provide to hotels, it’s important to note that direct bookings are not only achieving higher value overall but there is no commission payable on them so they are very much more profitable.”
He added that “hotels need to ensure that they are at least at parity with OTAs and other third-party channels in order to compete effectively. Too many hoteliers are giving OTAs better rates than their own websites which is not smart given the profitability of direct bookings”.
SiteMinder’s finding is based on 43.5 million reservations that passed through the company’s Channel Manager and TheBookingButton solutions between June 2015 to June 2016.
