At the Independent Hotel Show this week I found myself on stage twice, talking first about what makes an independent hotel stand out from the crowd and second, how do we turn the online travel agents (OTAs) which have become so dominant in global travel from the perceived enemy to the hotelier’s friends.
In several ways the two discussions are closely related. While some say that independent hotels are such small fry they have little bargaining power so can be effectively bullied by the big OTAs their independence is also what makes them unique, interesting, innovative and therefore attractive for the OTAs to have on their books because ultimately the OTAs need engaging content to sell to their customers. Also, let’s not forget that more than half of the hotel bedrooms in the UK are still behind the doors of independent hotels, many of whom will never be swallowed up by the branded companies thanks precisely to their individuality and quirkiness.
When most hoteliers speak about OTAs, often spitting the phrase with venom, they are invariably referring to the likes of Booking.com, Expedia.com and other global brand leaders in the online travel market. But these are relatively new to the market place, having only asserted their dominance in the last ten years, stealing a march on the rest of the hospitality and travel industry which was either dozing or navel gazing in the wake of the global financial crisis. We were slow to innovate, they were not. We can’t really blame them for that. They saw a gap in the market - a big gap - and filled it very efficiently and effectively. They charge anything between 15% and 25% for their services and have been accused of adopting bullying tactics towards hotels which don’t hand over all their rooms or don’t share all their special offers online. Some hotels now sell almost all their rooms through big OTA’s, paying these eye-watering fees every time.
15% or even 25% as a one-off fee is not expensive to acquire a new customer but only if, once that customer becomes a guest - the moment they walk through the hotel’s front door to sleep in the bed, dine at the table, drink at the bar - the hotel employs every tool at their fingertips to engender loyalty and make them theirs and not the OTA’s. The hotel that allows the guest to slip through their fingers and re-book via a different channel rather than direct with thew hotel is a fool to themselves. I speak from experience because we have allowed it to happen in the past by not being on the ball. In a fast moving and competitive industry like this complacency is our greatest enemy when our independence and ability to flex, adapt and to inform and engage our guests should be our greatest strength.
Inform, engage, surprise and delight, keep in touch and make it as easy as possible for guests to use your own booking site as anyone else's were the themes that rang loud and clear this week.
And while in both talks there was much discussion about what makes independent hotels stand out, their points of difference, let’s remember that just as all hotels were not created equal, neither were online travel agents.
Long before Booking.com was roaring onto our cinema screens with their booking.yeah slogans, smaller niche operators had started the online revolution.
Two that we have used for many years,
i-escape.com
and
celticcastles.com
both also charge commission. But their point of difference, strikingly similar to our own, is their independence and their knowledge of their clients. They are paid by hotels to find the right sort of guests so they work hard to curate the traffic that reaches us through personal contact and effective, focussed marketing because we are their clients. They are, in effect dating agencies, matching the right places with the right guests so that everyone on both sides of the transaction gets the best deal and long lasting relationships can flourish.
Ironically we are, of course, also Booking.com and Expedia.com clients but that relationship seems to go unacknowledged with their entire service geared towards the guests who pay nothing to use the service and their view of hotels being just a source of room inventory. They do this at their peril. Undoubtedly, it’s a fast track to a quick buck but as the big OTAs get bigger their offer becomes more unwieldy (Booking.com now has 1,052,185 hotels and counting worldwide on its books) and customers will start looking for more sophisticated ways to sift, select and satisfy their requirements than just price and location. Travellers want experiences now, they want to be part of the story and they need travel partners who understand that and can help make it happen - something the smaller specialist operations are already getting right.
Add to that the ever growing awareness travellers have that every time they book with a global OTA up to 25% less will go back into the local economy of the place in which they want to stay (and if they enjoy, may want to return to) and a world of branded hotels and homogenous booking engines starts to become a lot less attractive and sustainable than a world of independent hoteliers offering unique experiences through travel agents who understand them and who all have increasingly slick booking engines of their own to ease the traveller’s repeat reservation.
It may be a Utopian dream but without hotel rooms to sell and with enlightened guests able to make their own decisions quickly and effortlessly directly with a hotel or niche agent who understands their needs it may become not so much booking.yeah as booking.nah.
And finally, do we use big OTAs at Augill? Of course we do - they're an important and valuable part of the marketing mix. Booking.com has enabled us to access far flung markets we could only have dreamt of on our own. But we see it as a partnership, not a master and slave relationship. Hopefully that doesn't sound too Utopian...