Importance of having a booking engine

• December 13, 2018

Independent property owners can now no longer ignore the need for an integrated online booking engine. With such a large proportion of business and leisure travel researched and booked online, if your property does not have an online presence then your cannot be found. Plus operators should be leveraging their property website by integrating an online booking engine to drive their own direct bookings and control a greater share of their business.

An online hotel booking engine enables guests to book directly through the website of the hotel, providing the operator with all the guests details, higher revenue and reduced commission costs.

Today in hospitality there is an ongoing conversation around the over reliance on OTAs (Online Travel Agents) and the dominance that they have over the distribution of online reservations. The OTAs offer a valuable service, as a key distribution partner for hotels, but at a cost – both in terms of the commission that hoteliers pay, but also that hotels are losing the ability to engage directly with a guest pre and post stay.

Even though the OTAs vastly outspend hotel operators in terms of marketing activity and brand awareness, customers will in addition to using the OTAs site, look at an individual hotels website to search for more or local information whilst making a shortlist of booking options.

As end consumers we all tend to have a “deal mentality” believing if we form a direct relationship and cut out “the middle man” we can get a better deal. A hotel website is the ideal platform to do this. It yields the lowest cost of customer acquisition because of the direct interaction and an integrated online booking engine provides a source of direct bookings that can replace having to rely on the OTAs.

By receiving a direct online reservation, there is the financial benefit from spending less on commission payments plus operators are able to own the direct on-going relationship to use for their own advantage.

As an independent operator it would be great of course to have the majority of bookings come direct without paying commission – but in todays marketplace it makes sense to balance direct business along with reservations from the third party OTA channels. You are able to manage and spread the risk by sourcing reservations from multiple channels, keep costs down and “turn the tap on” for OTA business when the time is right and the conditions dictate it. 

If operators chose to turn off the reservations from OTAs based purely on cost considerations then there is the risk that a hotel could miss out on the product exposure offered by the OTA websites. Guests frequently use these sites for research purposes and an OTA is likely to have far better brand awareness compared to an independent property and subsequently a larger volume of visitor traffic. Awareness that provides access to potential guests that an operator would not normally get exposure to.

Independent hotel operators are becoming far more proactive in developing their own direct booking strategy, using a combination of marketing activity and online booking software.

Any reduction in the OTA commission costs will go directly to the bottom line as profit. Plus often the booking value of a direct reservation can be higher than that of an OTA booking.