Hotels versus intermediaries – consumers think online travel agencies are cheaper

Travellers presume they are getting a better deal if they book on an online travel agency – illustrating the battle hotels have in getting direct bookings.

Research with 1,000 travellers aged between 18 and 64 has shown that around 75% believe they get the best prices for a hotel stay via an online travel agency.

Speaking during the Direct Booking Summit in London last week, Triptease CEO Charlie Osmond (the company that hosted the event and commissioned the study) says it asked the 25% who do book direct why they did so.

Obviously, a lower price came out on top,  but other factors included that it was easier to book (54%) and that the check-in process felt easier and more personal (16%).

Only 19% said they did so because they get loyalty points, whilst 13% believed they had a better chance of an upgrade on their room and 12% figured they would be treated better by the hotel staff.

To the full sample size, when asked what reward a guest should get if they booked direct, 30% said a room upgrade, if available.

A quarter wanted free wifi but nearly one in five opted for free breakfast and 17% would ask for the ability for an early check-in or late check-out.

Although many travellers would not be familiar (or, indeed, care) with the minutiae of how commission structures work between suppliers and intermediaries, Triptease asked them how much they considered an appropriate percentage an OTA should receive from the hotel.

Unsurprisingly, only 1% believed it should more than 25%, with 41% arguing for something in the region of 0-5%.

The other commission levels were: almost a third said 5-10%, just over one in ten said 10-15%, and single digit responses for 15-20% and 20-25%.

NB: Save money image via BigStock.

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Kevin May

About the Writer :: Kevin May

Kevin May was a co-founder and member of the editorial team from September 2009 to June 2017.

 

Comments

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  1. Duncan Chappell

    This price perception research was and still is realy valuable. Thanks for sharing. It’s a great reminder that hotels, even if cheaper on their own website, are unlikely to win purely on price and that perceptions need to change across a wide consumer base. Rate mixing has meant independent hotels offering mutiple rates often end up being cheaper on the OTA without realising, or knowing, but unable to resolve it. I’d love to see some research that reviews booking policies, which is equally important. It’s also another area where Booking.com in particular has won big.

     
  2. Dean Schmit

    Metasearch channels also present a key opportunity to drive direct business. Rate parity, or the lack thereof, becomes very transparent on these sites. Being equal to or lower than other rates helps ensure the best results.

     
  3. Eshan

    Offers like free wifi, breakfast, room upgrades, are one part which will drive conversions, but foremost the hotel’s brand website needs more traffic to increase direct bookings. SEO/SEM is one way and another way is to have good reviews on TA and other reviews websites. Your hotel Ranking on OTA’s is the major driver of traffic to a hotels’s own website, believe it or not! Another important factor is hotel’s deposit policy. Pay at hotel would certainly drive higher bookings, as compared to upfront payment. A hotel can experiment with different deposit policies depending on the occupancy and see which one works the best.

     
  4. Evan Davies

    It’s going to be tough to educate the consumer that the best place to book is direct but it has got to happen. Every hotel should be offering some kind of bonus or discount on their own website. Guys come on!

     
  5. Remi

    Was that 1,000 travellers from the UK or a wider sample across Europe or the world?

     
 
 

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