Blog, Hotels


In the competitive hospitality industry, understanding the dynamics of different booking channels is crucial for maximizing hotel revenue. Online Travel Agencies (OTAs) and direct bookings represent two primary methods through which hotels can attract guests.
It’s hard to imagine a travel experience nowadays without OTAs. OTAs totally changed the approach in the industry. Travelers can book every aspect of their journey through the OTA platforms. Each solution has its unique benefits and challenges. This article explores why hotels need to leverage both OTAs and direct bookings, highlights good practices, and outlines a proposed approach to balance these strategies effectively.

Understanding OTAs

OTAs, such as, Expedia, Airbnb and others have revolutionized how travelers book accommodations.

These platforms offer significant advantages 👍:

  • Increased Visibility: OTAs have a vast reach, exposing hotels to a global audience.
  • Access to a Wider Audience: They attract diverse travelers, including those who might not find the hotel otherwise.
  • Ease of Use for Travelers: OTAs provide a user-friendly booking experience with reviews and ratings that help in decision-making.

However, there are challenges 😔:

  • High Commission Fees: OTAs charge significant commissions, impacting profit margins.
  • Less Control Over Customer Relationship: OTAs act as intermediaries, limiting direct interactions with guests. That leads to the lack of possibility of building a loyal customer database.
  • Price Competition: Hotels often have to compete on price, leading to lower rates.

The Value of Direct Bookings

Direct bookings, made through a hotel’s website or other direct channels, offer numerous advantages 👍:

  • Lower Costs: There are no commission fees, leading to higher profit margins.
  • Direct Relationship with Guests: Hotels can engage with guests directly, enhancing the customer experience.
  • Greater Control Over Pricing and Promotions: Hotels can manage their pricing strategies and offer exclusive deals.
  • Guests Data: Hotels can gather guest information and use it for direct marketing campaigns to increase clients loyalty.

However, driving direct bookings comes with its own set of challenges 😔:

  • Effective Marketing Strategies Needed: Hotels must invest in marketing to attract direct bookings.
  • Competing with OTAs’ Reach and Convenience: OTAs’ wide reach and user-friendly interfaces can be difficult to match.
But there’s NO challenge that can’t be overcome with a PROPER marketing strategy.

Why Hotels Need Both OTAs and Direct Bookings

In the highly competitive hospitality industry, a well-rounded booking strategy is crucial for maximizing revenue and ensuring sustainable growth. While Online Travel Agencies (OTAs) and direct bookings each offer distinct advantages, combining both can create a synergistic effect that enhances a hotel’s overall performance.

Complementary Roles

OTAs and direct bookings play complementary roles in a hotel’s booking strategy.

✈️ OTAs provide broad exposure, attracting a wide range of potential guests who may not have discovered the hotel otherwise. This increased visibility can lead to higher occupancy rates, especially during off-peak seasons.

🚁 On the other hand, direct bookings allow hotels to build stronger relationships with their guests, offering personalized services and experiences that can lead to higher guest satisfaction and loyalty.

Expanded market reach

✈️ OTAs have a global reach and are well-known for their extensive marketing budgets and resources. They can attract international travelers and first-time visitors who rely on these platforms for convenience and trust. By listing on multiple OTAs, hotels can tap into diverse markets and demographics, increasing their chances of filling rooms consistently.

So, you should treat OTA’s booking rather as a marketing tool, and their provision could be treated as marketing expenses. BUT! For effectively using this source of marketing, you need to have a tool for nurturing the relationships with guests for building loyalty.

Imaging you catched the new customer via the OTAs. What’s next? Make sure you have appropriate tool to collect their data during the stay, so you are able to send them special offers, marketing communication and build relationship with them once they leave the hotel.

Mitigating risks and maximizing opportunities

Relying solely on one booking channel can be risky. For instance, changes in OTA algorithms, policies, or commission rates can significantly impact a hotel’s revenue. By diversifying their booking channels, hotels can mitigate these risks. A balanced strategy ensures that if one channel underperforms or faces disruptions, the other can compensate, providing a stable revenue stream.

Leveraging technology and innovation

Both OTAs and direct bookings benefit from advancements in technology.

✈️ OTAs often lead in adopting new technologies such as artificial intelligence, machine learning, and personalized marketing. Hotels can learn from these innovations and apply similar strategies to their direct booking platforms.

🚁 Additionally, integrating technology like CRM systems, data analytics, and mobile-friendly app for hotel booking, web booking engines can enhance the direct booking experience, making it competitive with OTAs.

Few examples from the market

Hilton’s “Stop Clicking Around” Campaign

Source: Hospitality ON

Hilton launched its “Stop Clicking Around” campaign, marking the largest marketing effort in its history. The campaign was designed to encourage customers to book directly through Hilton’s channels by highlighting the benefits such as exclusive room rates, the ability to choose rooms from a digital floor plan, and earning points. The campaign also emphasized the convenience and personalized services available to direct bookers.


  • Significant increase in direct bookings, with a reported EMEA Web Direct Revenue +27% increase during the campaign period.
  • Enhanced customer loyalty and a reduction in reliance on OTAs, contributing to long-term cost savings on commission fees paid to third-party sites.
Amrâth Hotels’ Direct Booking Strategy

Source: Hotelchamp

Amrâth Hotels implemented a multi-touchpoint campaign with seasonal offers to boost direct bookings. They offered a 22% discount and free breakfast during the summer, which significantly increased their direct booking rates. Their campaign used countdown exit messages and mobile campaigns to maximize visibility and conversions.

Pacifica Hotels 


Implemented CRS, CRM and Loyalty program. These solutions offered different loyalty offers to guests through both the Pacifica website and hotel customer loyalty app. 

Implementation of CRS and CRM, along with the Loyalty Program has given an amazing outcome: over 31,000 member reservations and 66,000 member room nights in the first year.

The Optimal Balance Between Direct Bookings and OTAs

Finding the optimal balance between direct bookings and OTAs is a crucial process that depends on various factors unique to each hotel, such as its size, location, target market, and resources. However, there are some general guidelines and strategies that hotels can follow to strike a healthy balance and maximize their revenue.

Luxury hotels may benefit more from direct bookings due to their emphasis on personalized experiences, whereas budget hotels might rely more on OTAs for volume. 

Hotels in high-tourist areas might lean more on OTAs to attract international travelers, while those in business districts could focus on direct bookings for corporate clients. 

Understanding your guest demographics and preferences can help determine where to focus efforts. For example, younger travelers might prefer OTAs, while older guests may value direct engagement with the hotel.

Implement Dynamic Channel Management

Seasonality Adjustments: During peak seasons, OTAs can help fill rooms quickly, while off-peak times might be better for promoting direct bookings with special offers.

Promotional Strategies: Use OTAs for visibility and promotions to attract new guests, then incentivize direct bookings through hotel customer loyalty program app, discounts, and exclusive perks for repeat guests.

Optimize Your Direct Booking Platform
  1. User Experience: Ensure hotel website and hotel mobile app offer a seamless booking experience. This includes easy navigation, fast loading times, and a simple booking process.
  2. Value Propositions: Clearly communicate the benefits of booking directly, such as best rate guarantees, exclusive packages, and personalized services.

For many hotels, a typical balance nowadays might be around 60-70% OTA bookings and 30-40% direct bookings, but this can vary widely. Sometimes hotels 95-100% rely on OTAs. So this shows us a high OTA dependency. 

Determining the optimal percentage balance between OTAs and direct bookings can vary depending on a hotel’s specific circumstances, such as its location, target market, and business model. However, general guidelines can be gleaned from industry practices and expert recommendations.

General Benchmark: A common benchmark is for hotels to aim for around 50% of their bookings to come directly and 50% through OTAs. This balance helps ensure that hotels benefit from the broad reach and visibility that OTAs provide while still maximizing profitability and customer loyalty through direct bookings.

A strategic balance between OTAs and direct bookings allows hotels to leverage the strengths of both channels. For example, OTAs can be used to attract new guests and increase brand awareness, while direct bookings can be driven through the hotel’s own website, mobile app for hotel booking, hotel customer loyalty app and marketing campaigns. This approach ensures that the hotel remains visible and competitive in the market while optimizing revenue from direct channels.

The optimal balance between direct bookings and OTAs is dynamic and should be continuously evaluated and adjusted based on performance data, market conditions, and strategic goals.

What helps to find the optimal balance and increase the direct booking percentage in total bookings?

Enhanced guest experience and loyalty

Direct bookings provide hotels with the opportunity to engage directly with their guests from the moment of booking. This direct relationship enables better communication, personalized services, and a seamless check-in process. Hotels can gather more detailed guest information, which can be used to tailor experiences, offer targeted promotions, and build long-term loyalty through loyalty programs and exclusive offers.

Build offer for the whole customer journey

Expanding offerings to cover the traveler’s entire journey involves providing seamless and personalized experiences from pre-arrival to post-departure. This can include personalized pre-arrival communications, offering travel assistance and customizable in-room amenities. During the stay, integrating local experiences, wellness, SPA programs, and real-time concierge services can greatly enhance guest satisfaction. Post-departure, hotels can maintain engagement through personalized follow-up emails, loyalty rewards, and targeted marketing offers to encourage repeat bookings. This holistic approach not only improves guest loyalty but also increases the likelihood of direct bookings by offering a comprehensive and tailored travel experience.

Actively use other marketing channels

Hotels should not ignore other marketing channels. Social media platforms like Instagram and Facebook provide visual appeal and engagement opportunities that drive awareness and bookings. Email marketing campaigns can keep past guests informed about promotions and encourage repeat stays. Search engine marketing (SEM) and pay-per-click (PPC) advertising can target potential guests actively looking for accommodations. Collaborations with local businesses and event organizers can also bring in guests who might not find the hotel through traditional online channels​.

Leverage technology to achieve the optimal OTAs & direct booking balance.

Technology plays a crucial role in increasing direct booking rates for hotels by enhancing guest experiences, streamlining the booking process, and leveraging data analytics to create personalized marketing strategies. Here are key ways technology impacts direct bookings.

To enhanced user experience consider:

Mobile Apps and Websites: Modern, responsive websites and mobile apps for hotel booking provide a seamless and intuitive booking experience. Features like easy navigation, secure payment options, and instant booking confirmations reduce friction and encourage direct bookings.

Loyalty Apps: These apps store guest preferences, past bookings, and payment details, making future bookings faster and more convenient. They also offer exclusive rates and deals to app users, incentivizing direct bookings. Hotel customer loyalty apps offer rewards, points systems, and exclusive discounts to members, incentivizing repeat bookings directly through the hotel’s platform. Hotels can offer special rates to loyalty program members, which are only accessible through direct bookings.

Chatbots and AI: AI-powered chatbots on hotel websites and apps provide instant support and information, guiding guests through the booking process and addressing queries in real-time, reducing the chances of cart abandonment.

Example: Hilton Honors app enhances user experience by offering digital check-in, room selection, and digital keys, making the stay and booking process smoother and more appealing​.

Leverage Personalized Marketing

Data Analytics: Hotels use big data and analytics to understand guest behavior and preferences. This data allows for personalized marketing campaigns, targeted promotions, and customized offers that resonate more with potential guests, driving them to book directly.

CRM Systems: CRM systems integrated with booking platforms help hotels manage guest interactions and data, allowing for personalized communication and marketing efforts.

Push Notifications and Email Marketing: The Hotel customer loyalty app is usually integrated with marketing platforms that enable hotels to send personalized push notifications and email campaigns to guests, promoting special offers and encouraging direct bookings.


Maximizing hotel revenue in the current competitive landscape requires a balanced approach to both OTAs and direct bookings. Each channel offers unique advantages: OTAs provide broad visibility and access to a global market, while direct bookings enhance profit margins and foster guest loyalty. Achieving the optimal balance involves leveraging the strengths of both channels through strategic use of technology.

Technology plays a pivotal role in this balancing act. Dynamic pricing algorithms and advanced analytics enable OTAs to optimize rates and occupancy, while loyalty apps and integrated systems help hotels enhance guest experience and streamline operations. By investing in user-friendly direct booking platforms and personalized marketing, hotels can convert OTA users into loyal, repeat customers.

Loyalty apps, in particular, are a game-changer. They offer personalized experiences, exclusive deals, and seamless booking processes that drive direct bookings. Integrating these apps with PMS and RMS ensures real-time data synchronization and effective rate management, ultimately boosting direct booking rates.

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