In the hospitality industry today, convenience is everything. Given the events of the last year, there’s no reason for hoteliers to prefer their customers come to them exclusively through their own channels. Instead, hoteliers should accept that customers have their own preferred channels and realize that customers can show brand loyalty without channel loyalty.
The reality of travel in 2021 is that travelers have options when it comes to how they book and where they stay. Securing brand loyalty should be prioritized over channel loyalty. After all, if one customer books 5 stays through an OTA like Expedia or Travelocity, and another customer books 4 stays directly through your voice channels, would you value the first customer any less?
In short, no. At the end of the day, reservations are what matter. To comprehend loyalty in today’s travel landscape, hoteliers must understand today’s travelers, recognize what booking channels are preferred, create offers that appeal to travelers on their desired channels, and make it easy for travelers to book across all channels.
1. Understanding today’s travelers
When OTA’s first emerged onto the travel scene, they were highly disruptive. That’s because, in the past, most bookings occurred through direct channels or traditional travel agencies. The introduction and mass use of online travel agencies was now changing the travel landscape. Consequently, hoteliers saw a loss in direct booking revenue as online booking options became mainstream, making OTA’s the antithesis to a hotel’s revenue.
Since then, the hospitality industry has adjusted to the presence of OTA’s. Afterall, they still present hotels with valuable insights, such as data that revenue professionals can use to help secure future reservations. And for the marketing team, this information can further their understanding of today’s travelers to establish brand loyalty.
Today, hoteliers exist in relative harmony with the many popular online booking options. In part, because travelers enjoy the convenience and numerous benefits available through their preferred booking channel. Regardless of where hoteliers stand on this topic, OTA’s have forever shifted the marketplace, and they are here to stay.
The simple truth is that OTA’s, alone, no longer pose the threat to hotel revenue streams that they did when they first appeared. Now OTA’s are institutionalized in the hospitability industry and should be embraced by all parties.
At the end of the day, travelers are going to do what’s easiest for them to book. If that’s booking through an OTA, then hoteliers must understand why travelers turn to OTA’s and ask, "how can they create brand loyalty without channel loyalty?"
2. Should loyalty always be defined by source?
Emily Bowen, CRME, CHDM Director of Revenue Strategy, questions whether the source of the booking becomes less relevant as long as it meets the emotional needs of the guest during their transactional experience.
The variability in each traveler's needs, the emotional weight of today's travel decisions, combined with general decision fatigue could make meeting the guest where they are in the purchase journey even more critical in connecting the emotional journey to the transactional one, creating a higher likelihood of return.
According to Emily Bowen, “people external to the travel industry likely do not understand the nuances of booking sources and their importance to a company’s bottom line. When we become hyper-focused on the source, we may risk the guest perceiving that they are doing something wrong and ultimately, affecting the [emotional] connection to the guest."
3. Recognize what booking channels travelers prefer to use.
When a traveler books your property through an OTA, your CRM can still house their data. So, despite the traveler using a third-party channel, hoteliers still have access to a traveler's stay history, booking patterns, and more. From this data, you can learn how to market to that OTA guest in-house for future reservations.
Similarly, once a hotel identifies what a traveler's chosen booking channels are, they can work to facilitate future bookings. If it’s apparent that many travelers are booking through certain third-party sites, appeal directly to those travelers on their current channel of choice and offer special rates and promotions exclusively for those OTA channels.
4. Create offers that appeal to travelers based on the channels they prefer to use.
Hotels can still work to build brand loyalty with guests who book through OTA’s. As noted above, enticing travelers to book through their favorite OTA’s with exclusive promotions and special rates will persuade guests to book your property again.
Repeat bookings, even through a third party, help establish brand loyalty. Incentivizing travelers with exclusive deals and promotions through their chosen OTA’s will urge them to develop brand loyalty, despite them having channel loyalty to an OTA.
Traveler’s, like all consumers, are habitually driven. As discussed in The New Wave of Brand Loyalty, purchasing behavior can be incredibly difficult to influence. Once a purchaser, or in this case, a traveler, has their mindset on a booking channel, they’re likely to return to that same channel for future travel.
According to Emily Bowen, “travelers will follow the path of least resistance when it comes to booking their stays." By using targeted promotions on OTA’s, hotels can create a path for travelers to follow that ends at their properties.
5. Make it easy (fewer restrictions, more flexibility)
When addressing the presence of OTA’s in the travel marketplace, John Smallwood, Travel Outlook President, acknowledges that many travelers will favor OTA’s over direct channels. But what truly matters is travelers having options. “OTA’s have changed the way we do business and the way most travelers now plan their stays. Hotels should accommodate and facilitate all reservations regardless of what channels they come from, while still actively promoting the use of direct channels.”
Instead of fighting an uphill battle to attempt to change a traveler's purchasing behavior and convert them to a direct channel user, facilitate their booking process on their channel of choice, which includes your hotel’s voice channel. Then focus your attention on incentivizing repeat bookings.
In summary, giving travelers the ability to conveniently book through OTA’s and providing travelers with reliable direct channels will increase reservations and build brand loyalty.
About Emily Bowen , CRME, CHDM Director of Revenue Strategy
Emily Bowen is a practicing Revenue Management professional with more than 15 years of experience in operational and strategic management in the luxury and independent hotel and resort space. She holds certificates through HSMAI as a Revenue Management Executive and Hotel Digital Marketing and was a recipient of their Revenue Management Professional of the Year award. She is a proud alumna of The Pennsylvania State University, where she works as an executive for the Hospitality Services team, has contributed to the School of Hospitality Management as an Adjunct Professor and is currently serving as a Board member of the Recreation, Park and Tourism Management's Affiliate Program Group.
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