Hotels admit steep reliance on online travel agencies

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Hotels have a high dependency on online travel agencies to distribute their inventory, with almost every other channel deemed to be low on the same scale.

This is one of the top-line findings from a major study for hotel distribution association HEDNA's Hotel Analytics Work Group, prepared by accommodation technology companies Triometric and SnapShot.

The study spoke to chain hotels, independent properties and management companies.

Independents were found to have a "surprisingly balanced channel mix" and the cost of distribution was a key factor in their overall distribution strategy and use of data.

Chains, in contrast, had a "surprisingly high" impact on their channel share from OTAs, the study finds.

For example, almost 60% of chain properties used OTAs for between 10% and 50% of their inventory, and 32% relied on the same channel for more than half.

Management companies had only a slightly lower dependency, with 29% of respondents relying on OTAs for more than 50% of their inventory (59% in the 10%-50% range).

Indies, on the other hand, have a high dependence but the figures are much lower: 39% of properties rely on OTAs for 10%-50% and 37% in the 50%+ range.

Both chains and management companies have a medium dependency on global distribution systems, the report found.

Data to help

A core part of the study focuses on the use of analytics to help properties make their decisions when deciding on which channels to use.

OTAs play a significant role in distribution and are found to provide the best data, with 31% of properties getting real-time information and 30% being serviced with daily analytics.

Wholesalers, late-booking platforms and metasearch engines were found to give no access to many properties.

Almost half (45%) didn't get data from late-booking services, with wholesalers and metasearch engines not supplying data to 42% and 33% of hotels respectively.

Still, the biggest challenge that properties have with the data they receive is deemed to be its overall quality and "cleanliness".

Other concerns include integration issues from external systems (15%), and integration internally and staff training (both 10%).

Interestingly, seven out of ten chains use their distribution data as a source when negotiating terms with third party channels, compared to just under half (49%) of independent hotels.

Key performance indicators

The report found some interesting differences between hotel types when asked to outline the KPIs that are associated with distribution.

The cost of distribution is used by fewer independents (48%) than chains (65%) as a benchmark, for example.

Access to comparative market data is an important to 71% of chains compared to 34% of indies.

Unsurprisingly, pure revenue is a KPI for 92% of chains, 90% of management companies and 83% of indie properties.

In terms of website monitoring, 31% of chains and management companies look at response times, as opposed to just 20% of independents.

A similar difference is found in error rates, with 15% of hotels and just 4% of independents citing it as a KPI. 

* More details and discussion from the report, which surveyed over 1,050 properties worldwide, will be shared during a HEDNA webinar on March 20.

Daniel Diosi