What to know before investing
Investing a slice of your budget into the GDS is certainly worthwhile, especially if your hotel is struggling to attract enough travellers, or the right type of travellers.
It’s definitely a niche sales channel that your competitors may not be taking advantage of. In fact, maybe you are in the unique position of being suited to the GDS when other properties wouldn’t gain value from it.
However, even knowing what the GDS is and what it can do for hotels, it can be difficult to really know if it’s right for your hotel and how you can tap into this lucrative system.
This page will give you some tips and information to make it easier for you to be successful in utilising the GDS to increase bookings and revenue at your hotel.
The GDS is a vast network with more than 600,000 travel agents around the world hooking into it to sell hotel rooms, flights, and other travel related services.
To gain access effectively, you need a powerful technology partner that can give you a single point of entry to the world’s most prominent GDSs. This prevents you having to pay the individual connection fees for each GDS. However, you’ll still be required to pay a percentage of reservations to the provider, similar to when you pay a commission on bookings from Booking.com.
This type of agreement allows your hotel to connect to all the global travel agents at once, giving you unparalleled visibility to a range of travellers who would never have found your property otherwise.
You also need the ability to process reservations instantly and automatically between the GDS and your property management system, ideally via a channel manager. Your GDS provider needs to have strong integration power or offer the additional services that you require.
Many hotels think so but when you consider the commission fees paid to third-party booking sites like Expedia, a connection to the GDS is affordable.
Commissions to online travel agents are usually around 15-18%, while a GDS booking will sit at around 10% plus a small transaction fee.
Since the GDS is extremely popular for boosting corporate bookings, it’s important to note that business travellers will spend 50% more at the bar, restaurant, and on incidentals than leisure travellers – adding up to more value for your hotel.
Using a provider like SiteMinder is the most cost-effective manner of connecting to the GDS. Otherwise, each individual GDS service requires a setup fee and monthly transactions costs.
Knowing the world of potential the GDS opens up, you might rightly be excited to get started. Before you sink too much time in seeking connection and contacting providers you should be clear about if it’s appropriate for your property. There’s also some criteria your connectivity partner should meet.
You can certainly have discussions with tech partners like SiteMinder to check your suitability but in general here are some specifications that will aid successful connectivity:
These requirements are not essential but will be beneficial.
It’s also important to choose an established provider and make sure you ask for training and support.
Here’s a checklist to ensure you’ll be able to use the GDS to its full potential:
1. Pooled inventory
Without this feature available, you will be forced to separate your inventory based on the distribution channel, which can prevent you from maximising your bookings and increasing your revenue.
2. Commission-free structure
Your GDS should help you maximise your bookings and increase your revenue, not deplete you of the revenue you should be earning per booking. Do not choose a partner that forces you to pay a commission fee simply for delivering the booking to your hotel’s property management system (PMS).
3. Integration capabilities
It’s imperative you have the capability for the GDS to integrate completely with your existing PMS, online booking engine and channel manager. This simplifies the process for you and allows you to effectively implement and manage your distribution strategy.
4. Comprehensive reporting
Your GDS software should help you make the best decisions regarding your marketing strategy and distribution plan. Select a provider that offers comprehensive reporting tools that allow you to view and evaluate your booking data.
5. Ability to target specific markets
A GDS gives you the opportunity to discover and tap into the most powerful and motivated market segments. You should be able to filter your access based on the geographical location and also specific types of travellers.
6. No lengthy contracts
Look for a provider that allows you to trial the GDS for a short time and measure results before continuing your subscription.
7. Simple and affordable connection
Each GDS has its own set of connection fees and requirements to sign up. By using the right provider, you eliminate the frustration of signing up with each individual platform, and you can connect to all of the top providers without paying the individual fees.
You also need to get a few things right regarding the way you represent your hotel on the GDS. Most prominent is your hotel description, which will act as your hotel’s electronic brochure. This provides travel agents with your property description, hotel amenities and information about local attractions.
Ultimately, connecting to the GDS is going to require a conversation between you and your potential technology partner, or the GDSs themselves of course.
There are plenty of reasons to use the GDS and many ways in which your hotel might be able to win revenue and bookings this way.
Particularly if you are located in a high-traffic destination or a destination popular with business travellers you can express your interest and discuss your suitability with a good degree of confidence.
To see if the GDS is right for you, you can talk to expert staff at SiteMinder today. Simply click here to get in touch.