It is widely accepted that lowering distribution costs is the fastest way to increase a hotel’s bottom line. The journey there, however, can be overwrought with difficulties and confusion.
We’re not believers in a one-takes-all strategy. Direct bookings are great, but third-party bookings also have their (quite important) place. A truly healthy booking ecosystem for the hotel meetings business provides customers with a variety of booking channels.
Why? Because different meeting planners naturally prefer to book through different channels.
Take these three use cases:
Customer A is an experienced meetings planner who knows exactly which hotel, layout and seating arrangement her team needs and is looking to go directly to the source. When she visits the hotel website, she wants to be able to check availability, make her selection, complete and pay for the booking in minutes – without having to speak to anyone or wait to receive information.
Customer B is a relatively new planner who is looking at the website of the company’s preferred hotel. He is searching for the portal that allows him to view options and book a meeting room immediately. He books vacation homes, dinner and cars on direct digital platforms – so why not meeting spaces too?
Customer C is an employee who has been thrown into the planning role and isn’t sure where to look or which hotel to choose to book a meeting room. She’ll scan a third-party platform, discover new options and book meeting rooms across several hotels until she finds the one that clicks for her team. Once that happens, she doesn’t want to spend any more time shopping around. She should be able to transition smoothly from shopping around to booking direct.
Intermediaries can play a vital and valuable role in the hotel’s growth strategy. They provide access to customers who do not yet have allegiance to a single hotel chain and a means for those who want to search and compare hotels across many locations. The more experienced customers however don’t want to look around or submit RFPs for every small offsite or event.
Hoteliers should provide their customers with a variety of easy and efficient booking channels, but it is important to position the direct channel as the easiest and most efficient whether it’s a customer’s first or 100th time booking. By relying on third- party channels alone, hoteliers are missing out on perhaps the most critical step to cutting distribution costs.
It is not a question of third-party or direct channels – they can and should exist collaboratively. Once this is accepted, then hotels can be on their way to lowering distribution costs.
Hyatt CEO Mark Hoplamazian addressed the need for a healthy and varied booking ecosystem in a 2017 earnings call saying, “Our distribution channel strategy includes a focus on driving bookings through Hyatt channels so that we can build stronger relationships with our guests.”
“At the same time, we recognise the value OTAs [online travel agencies] play in keeping Hyatt top of mind for guests who might not be frequent travelers or who otherwise have a reason to book through OTA sites.”
Hoteliers must take a long-term approach to realise the vision of a meetings business in which distribution costs are minimised through the implementation of direct digital platforms, but augmented by new customer bookings from third-party collaborators.
To learn more, download the white paper 5 Steps to Lower Distribution Costs & Drive Meeting Bookings. To learn more about BookingTek and how we can help your hotel achieve a holistic booking strategy, contact email@example.com.