Hotel vs. OTA Parity Agreements: Does It Have to be a Battle?
In this article, the author presents six such strategies that hotel operators can use to drive direct bookings without conflicting with their OTA agreements.
If a love-hate relationship exists in the hospitality industry, it’s between hotels and online travel agencies (OTAs) such as Expedia, Orbitz and Priceline, among many others. On one hand, OTAs extract sizable commissions, which understandably grate on the hotels that must pay them. On the other, they also produce an enormous amount of bookings, which hotels covet.
Hotels would prefer their own websites and call centers be their guests’ major distribution channel, but so popular are OTAs—and so dependent on them have many hotels become—it’s difficult to imagine hotels eschewing their services altogether. Particularly challenging are OTA parity agreements, which require hotels to guarantee that room rates on their own websites are not below those offered by the OTAs.
Despite this challenge, savvy hotel operators are finding ways to provide incentives that entice customers to book directly through their own websites, front desk or over the phone. In this article, we present six such strategies that hotel operators can use without conflicting with their OTA agreements.