Driving Maximum Profit through More Direct Bookings

  • Hotels should incorporate user ratings and reviews
  • Third parties charge anywhere between 10-25% commissions for every booking they secure
  • Pricing by room type is an area of opportunity for nearly every hotel

In today’s ultra-competitive hotel environment, every dollar counts. With rising costs associated with acquiring new guests through third-party platforms, hotels are rightly considering their most effective booking channels and looking to maximize business from owned assets like their own website.

Acquiring Guests in a Digital Age

Today’s costs for acquiring guests are at an all-time high: Third parties charge anywhere between 10-25% commissions for every booking they secure. These third-party costs influence the amount of revenue hotels are able to secure from each guest – ultimately impacting a property’s bottom line.

Hoteliers that effectively market themselves to potential guests, practice advanced search engine optimization strategies, and offer guests a unique value can greatly reduce their cost of acquiring guests.

How can hoteliers maximize direct bookings through their website? The first step is increasing website traffic from potential guests and attracting more ‘lookers.’ What dates are they searching for, where do they search and what is driving them to a particular market? Collecting this market intelligence provides data that can be used to develop targeted marketing strategies that attract the right type of ‘lookers,’ the ones most likely to become ‘bookers.’

Capturing Direct Business Through Effective Website Design

If a website’s booking process is not seamless and secure, guests will book elsewhere. That means all the work that went into attracting a guest led to providing someone else a commission for that booking.

The website design should deliver an enhanced customer experience with user-friendly features that provide easy navigation and booking. It is also important the website can be viewed in multiple languages to cater to guests traveling from around the world.

Hotels should incorporate user-generated content from social media sites, such as user ratings and reviews, to assure guests of the credibility and service standard of the hotel. Since over half of online bookers search online reviews before making reservations, it is critical to provide online reviews as a component of website content.

Mobile phones and tablets are increasingly used for researching and last-minute bookings. A recent eMarketer survey showed that 65% of same-day hotel reservations are made via smartphones. Hoteliers looking to capture guest bookings from mobile devices need to ensure their website is user-centric, responsive and compatible on mobile and tablet devices.

Personalizing the Guest Experience

Ultimately, guests seek hotel experiences tailored around their unique needs, which is why they often visit a hotel’s website for more information. However, if the hotel website isn’t focused around the needs of the consumer (such as having more photos, videos and reviews than an OTA), they may quickly move on to another property. Hotels may not be able to compete with OTAs on the level of website traffic they generate, but they should beat them at showcasing their own property.

For example, most hotel rooms look similar, and while it is important for guests to know what the rooms look like, hotels should focus more on their differentiators. These differentiators could be local experiences or their iconic rooftop pool, farm-to-table restaurant or intriguing history. Millennials may not be as brand loyal as previous generations, but they aren’t driven solely by price either. They appreciate unique experiences they can share with their networks—and they are willing to pay more for it.

Pricing Advances Hoteliers Need to Consider

It is important to understand the pricing strategies employed by competing properties in the market and the effect this has on forecasting and pricing. Hotels should look for revenue management technologies that incorporate competitor data into their demand, pricing and forecasting at the room-type level.

Pricing by room type is an area of opportunity for nearly every hotel today. By individually calculating demand by room class, the pricing difference between each room class can be adaptable – and drive significant revenue uplift when demand for higher room classes such as suites or club rooms is high. The traditional approach of adding a flat dollar amount onto the base room type rate often leaves significant revenue opportunities untouched.

Driving Direct Business

It’s no secret that driving direct business and better revenue is one of the top priorities facing all hoteliers. In an age of rising third-party guest acquisition costs, hotels are increasingly turning their attention to their most cost-effective online booking channel: their website. However, driving website traffic is not enough on its own; to maximize and achieve the most profitable revenue results, hotels need to not only attract the ‘lookers,’ but be successfully converting them into ‘bookers.’

With all of these tips in place, you are sure to drive more direct bookings–leading to maximum profit for your hotel.

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