The value of a direct booking at your hotel
There are very good reasons to fight for a higher proportion of direct bookings, perhaps the least of which is a better profit margin.
Here are a few reasons direct bookings are so valuable to a hotel:
- Personal relationships
With the hotel industry being people-based, the best way to nurture a good relationship with customers is by interacting with them directly, not via a third-party booking agent. A direct booking means your hotel has all guest details and profiles from the beginning and you can own this relationship through their entire booking journey.
- Trip anticipation
Travellers often get more enjoyment in the weeks prior to a trip than the trip itself. A direct relationship allows you to perfect pre-stay messaging and get your guests even more excited about coming to your hotel. This will start your relationship off on the right foot.
- Guest loyalty
As you know, keeping a current customer is much cheaper than finding a new one. During a direct booking, you can gather the guest details you need to send some post-stay messages, reminding the guest how great it was to have them stay at your hotel and to welcome them back anytime. It also enables to run promotions only to guests who have stayed before.
- Guest feedback
Someone who books with your hotel directly is making a far more active choice than an OTA booker, and is more likely to be from your target market and connect with the values of your property. This will lead to more consistent and positive review scores for your business.
The more data your hotel has on a guest, the more personalised you can make their experience each time they come to your hotel. This data is best collected via direct relationship that starts with a guest researching your property’s offering.
- Less commission
The most common factor hotels reference is that direct bookings don’t require a commission fee to be paid to an OTA. This will let you keep 15-25% more revenue on each booking.
This blog will help you discover some ways you can win more direct bookings and know what works when guests are making up their mind.
Table of contents
Increase hotel direct bookings with unique offerings
In a world dominated by big brands and businesses, where standardisation is the path to efficiency, customers consistently look for something out of the norm. This is clearly the case in the travel industry; it’s one of the major reasons Airbnb has been so successful.
Travellers can get bogged down by same-same marketing, and middle-of-the-road hotel experiences. They want something unique, authentic, and personalised.
To get more direct bookings, your offering has to reflect these desires. So how do you make your property stand out from the competition and convince guests to avoid booking via OTAs?
Understand the audience you want to target
The first step to being able to offer a unique selling point to travellers is to know who you want to target and who will be visiting your website.
For example, Marriott expects the majority of guests to be millennials, so the company’s direct bookings marketing campaign emphasises the experiential joys of staying at a Marriott.
Doing the research into your most common demographic will be worth it, as you can start shaping your offerings to perfectly suit your guests.
Provide interesting incentives for travellers to book direct
While using the word ‘bribe’ might be too strong, there are certain offers you can make that travellers will find hard to refuse.
For instance, about half would be most likely to book direct if a hotel offered a room upgrade as an incentive. Second in line is free room service, at almost a quarter.
Often an add-on like this won’t break the bank at your business but can be a powerful motivator for travellers to book direct and save’. In fact if you do upgrade a guest, you can then resell the original standard room – effectively selling this room twice.
Use authenticity to your hotel’s advantage
Independent hotels often have a much closer affinity to the local area than big brands, so use this to attract guests via your website. Maybe your hotel is lucky enough to be near a theme park, popular nature reserve, or maybe your building itself is heritage listed.
Focus on what makes your hotel special and make this clear when travellers visit your web pages. You could even create special promotions around these unique features to further entice people to book direct.
Use exciting content to engage travellers
When travellers are browsing your site they want as much information about your hotel as possible, and they want to be wowed. If they get both of these things, it’s very likely they’ll be happy to book directly with your hotel.
Think about using video content to showcase your hotel. It doesn’t have to be Hollywood quality, simply a short and sweet production showing off the best aspects of your property and its staff. Or you could go even further and use virtual reality to give potential guests a ‘try before you buy’ experience with a 3D virtual tour of your hotel. VR is becoming very popular and also more cost effective, so it’s worth a thought.
The importance of visual storytelling is vital, as is knowing what visuals to use. Images create emotions within individuals and opens up their imagination. Guest rooms are the most-viewed images on hotel websites. This means you should be leading with images of your rooms on your website to get travellers interested and excited.
Give guests a different, more original promotion to consider
While percentage-off stay deals or common room package promotions are fine, they don’t differentiate your hotel from its competitors.
Instead, think about what guests might really want. For example, people are excited about their trip and just want to enjoy the experience. If they have to plan out all their days and work out a number of details, this excitement can fade away to a certain extent; to be replaced by frustration or impatience.
Make it easier for guests by offering an itinerary package – a ready-made bundle of activities around the area. You could have a few immersive experiences for specific guest types. This might include a family bundle package that offers tickets to local attractions with vouchers for a meal at your restaurant. On another day it might provide tickets to a children’s play centre while the parents enjoy relaxing massages.
Make hotel direct bookings sweeter with extras
Extras are an inextricable element of your hotel’s direct booking strategy. It’s a win-win situation: they enhance your guests’ experience while increasing your profit.
In recent years Tnooz released fascinating statistics around extras that will help you improve your up-sell and cross-sell strategies across the board.
- Overall, 15% of guests will purchase extras at the time of booking.
- Guests who book 1-7 days in advance of their trip are 3x more likely to purchase extras when they book.
- Guests who book 7-21 days in advance are actually 5x more likely to purchase extras when they book.
- Travel parties of 1-2 people are most likely to purchase extras that are available at your hotel, such as a bottle of wine or in-room breakfast.
- Travel parties of more than 3 people are most likely to purchase outside extras, such as tours, activities and dining reservations. Partner with local businesses in order to earn commission for these bookings!
These facts and figures make it clear that extras are not just a passing trend — they’re a set of complementary products that you should always try to tweak and improve at your hotel.
Here’s a few ideas to consider when it comes to selling extras at the time of booking:
Many travellers like to use public transportation or simply walk from place to place once they have arrived in their destination.
This means that they will not be renting a car, and may prefer the convenience of a shuttle from the airport directly to your hotel property.
By offering shuttle services as an extra at your hotel, you can allow them to conveniently book everything they need at once.
Products and gifts
Products and gifts are a popular extra amongst guests, specifically those who are celebrating a special occasion on their trip.
Champagne bottles, fresh, local fruit and local wine are marketable extras that you can up-sell to your guests at the time of booking.
Tours and activities
More and more, travellers are looking for one-stop shopping when it comes to planning their holidays. By offering room packages that include local tours or activities, you will appeal to these time-savvy travellers.
In addition to earning the extra revenue on the booking package, you’ll probably be able to earn a commission from the tour company that you partner with in your area. This is a wonderful way to boost the local travel industry while generating additional business for yourself.
And of course, your guest wins with the perfect hotel stay and tour or activity experience.
Use an online booking engine that allows your guests to purchase these products and services at the time of their reservation.
Direct bookings at your hotel can be won simply with better images
If a traveller has any suspicion about the quality or authenticity of your hotel, it’s very unlikely they’ll book with you.
A lack of published reviews and a lack of photos are two of the biggest red flags for guests when browsing hotels. To someone viewing a hotel on the Internet, the absence of reviews or images may indicate to them that the hotel is hiding something – perhaps evidence of poor quality service, dirty interiors, or misleading location information.
TripAdvisor published findings stating that when compared to hotels without photos, hotels with at least one photo saw a 138% increase in travel engagement. On top of that, hotels with at least one photo are 225% more likely to receive a booking enquiry. If just one photo can make this much difference, think of the statistics if your hotel develops a strategic plan for your property photography.
During the browsing stage people generally fixate on the hotel name, images, price, and location. This means you have a chance to wow them with photos before they read any reviews.
Here are the best ways to approach your hotel imagery:
Capture a pleasing vista
The majority of images that extracted positive emotions from consumers were bedrooms with window views, a pleasant vista, and natural light. The photos helped create an instant reaction between the consumer and the hotel. Positive feelings were also exhibited when customers saw something interesting outside of the hotel like a beach, city, or landmark.
Display unique and attractive features
If your hotel has any unique features put them front and centre in your photography to delight the eyes of online shoppers. This way the potential guest will be immediately drawn to your hotel.
Don’t meddle with perspective, balance, and distortion
By far the most popular images were those that also looked authentic. Photos that looked skewed or altered drew suspicion from shoppers because they create unrealistic representations of the property. Hotels should instead keep it simple and try not to show too much in a single shot.
Keep images clean and crisp
Neatness and precision were the qualities that garnered the best responses to hotel room images, along with light and space. Negative opinions focused on messiness and clutter, clashing colours, odd angles, or missing features such as bathroom or wardrobe.
With eye-catching imagery and unrelenting dedication to quality, it’s clear you can use imagery as a powerful boost to your bookings.
Direct hotel reservation barriers and how to remove them
Direct bookings are always at the top of a hotelier’s mind. The higher percentage of bookings that come direct through a hotel’s website the better.
Investigating the barriers that stop customers booking direct and creating strategies that remove them is a never-ending but necessary battle.
Common problem areas include:
- The cost of technology support
- Reliance on online travel agents (OTAs)
- Cost of acquisition (e.g web design and user experience)
- Lack of hotel resources
All of these are reasons why hotels are either not pursuing, or not being allowed to pursue direct booking campaigns and foster return business.
However, there are methods hotels can use to improve their chances of direct bookings.
Here are seven reasons direct bookings are important and some strategies for hotels to make the most of them.
1. Anticipate the booking and communicate pre-stay
If a customer does in fact make a direct booking it’s important to reinforce that decision. The first step is by raising the anticipation of the guest for their trip. People like to be excited by the prospect of a holiday; often the period before departure is the most enjoyable feeling of the whole process. A common way of achieving this is to create a consistent and enthusiastic stream of pre-stay communication with your guest, usually via email. This may be as simple as telling them you can’t wait to see them in two weeks, or you might provide them with information about cool things to do while they’re staying at your property.
2. The traveller’s active choice
It’s been found that there is a direct correlation between guest satisfaction and direct bookings. Direct bookers are often happier because they’ve made an active choice to stay at your property. This may not always be the case for OTA bookers. This can result in a lack of personal connection and relationships, resulting in poorer reviews. When you get a direct booking you know they’re definitely from your target market and coming in with positive attitudes about your hotel.
3. Reroute your commission savings into the guest experience
Commission paid to OTAs are probably the biggest reason hotels look for more direct bookings because they eat into the potential profits of the business. Money saved on direct bookings can be better spent on guest experience and hotel upgrades. Commissions can be reduced by maintaining price parity to save on conversions and keep pricing transparent to debunk the belief OTAs always offer a better deal. Use some innovation in how you approach your direct booking strategy to entice as many travellers as possible to your website.
4. Build relationships with travellers
Building relationships with travellers is a big bullet hotels can fire in the direct booking battle. Using research and creating customer profiles to find common ground and appeal to your target’s interests is vital if you want to encourage direct bookings and build guest loyalty. Be imaginative in the way you engage travellers and always be positive.
5. Think about direct bookings and future innovation
New technology is sure to be a boon for any purpose you want. Decide what is best for you in progressing your relationship with customers. Services such as live chat or messenger apps might be serious considerations. Anything that enhances your social media or simplifies your booking process is a must.
6. Receive ancillary revenue from your bookings
Offering additional services or products to give the customer a ‘shopping cart’ experience is a good tactic even if the guest isn’t interested in purchasing any extras. It gives the sense of professionalism and credibility, and puts your hotel on a competitive level with OTAs who often offer some kind of package deal. Making sure you think of your hotel as more than rooms and beds is always a positive step towards enriching the experience of your guests.
7. Boost your hotel’s brand loyalty
The best way to ensure an increase of direct bookings is to boost brand loyalty and create new return customers out of every new traveller who enters your hotel. Increasing hotel brand loyalty is an obvious and natural way to boost direct bookings and has numerous added benefits such as:
- The ability to know the guest preference
- This enables your hotel to deliver a better experience by offering more appropriate products and services to meet the guest’s needs.
- A diversified portfolio of hotel booking sources
- This makes for a more stable and healthy business mix overall so that a hotel does not become dependent on only one or two primary markets.
- Loyalty members are a comfort blanket
- A larger member base means your hotel will better resist low seasons and harsh economic periods.
Direct booking at hotels: Combatting abandoned bookings
There’s nothing more frustrating for a hotel than when all their great marketing work pays off and huge traffic flows to their website, only to see a minimal increase in bookings.
Driving as much traffic as possible is certainly important, but the harsh reality is most visitors abandon their booking.
The general industry conversion rate on travel and hospitality websites is around 2%, this means a staggering amount of visitors are dropping out of the booking experience at some stage. And interestingly, even with massive marketing budgets, online travel agents (OTAs) and hotel chains can usually only hope for a 3% conversion rate.
This further cements the assumption that travellers are very savvy shoppers, willing to spend a long time researching and comparing prices on different devices before they make a purchase decision. By the time a consumer actually commits to a payment, they’ve already been on a world tour in some respects.
Six major reasons for abandoned bookings:
- Need to do more research
- Price too high/want to compare
- Need to check with other travellers
- Process was too complicated
- Technical issue
- Payment issue
Guests may also leave for other reasons, without ever intending to make a booking, such as:
- Viewing a previous reservation
- Using your site for research
- Looking for destination information
- Browsing for deals and discounts
What can hotels do to help solve abandoned bookings?
Thankfully, the last three major abandonment issues are easily solved and may go some way to increasing your conversion rate. Let’s take a look at the steps you can take to tackle this issue…
#1 Make your booking experience a two-step process for your guests
The more hoops a user has to jump through on your website, the more likely they are to give up on their booking. To clarify the booking process all you need is a smart and simple booking engine integrated with your website. This will allow the guest to complete their booking in seamless two-click procedure across a limited number of pages.
#2 Make your website mobile-responsive to improve the user experience
An intuitive content management system or website editor will help you create a beautiful and functional website that is optimised for all devices. A responsive website will prevent any technical snags your visitors commonly come across.
#3 Make sure your guests can book your hotel in a safe and secure way
A secure payment gateway that integrates with the rest of your hotel systems and gives visitors payment options in their local currency will prevent frustration and make for a quick booking experience.
#4 Test your forms and website experience
Obviously it’s hard to find out why each individual abandoned a booking. To get some concrete feedback, ask friends and family to try to complete a booking on your website. Get them to note down any confusing or complicated aspects that may have made them feel like discontinuing the process.
Once you have some of these answers, you can be much better prepared to improve and optimise the booking process.
#5 Attract attention to how unique your hotel is
Your website should showcase everything exciting and unique about your property, giving travellers every reason to make a booking once they land there.
Perhaps it’s your bar, regular events, super friendly hands-on staff, or something else. Whatever it may be that makes your hotel stand out on-site, make that stand out to visitors on your website. If they fall in love with your property just by viewing your online photo gallery for example, then the impact of any friction they encounter will be lessened.
Why is Expedia cheaper than booking direct?
The answer to this is that it may not be. Historically travellers may have booked flights and hotels via sites like Expedia because the prices seemed much cheaper.
These days travellers can often get the same deal or a better on by booking direct with your hotel. Value-added offerings and an increased level of customer service are big incentives for guests to book direct with the hotel. Booking direct opens up opportunities to be upgraded and receive additional extras that might not be offered anywhere else.
If something goes wrong with the reservation, it’s also likely your hotel will be much more responsive than a third-party agent and customers like to have easy access to support.
It needs to be made clear to guests that making a direct booking is mutually beneficial, and doesn’t just help your property’s bottom line.
How much does a direct booking cost your hotel?
On face value the cost of acquisition for a direct bookings is lower than that of an OTA booking, thanks to the absence of hefty commission fees. However, if you’re not careful a direct booking could still end up costing your hotel too much.
You have to think about the cost of acquiring traffic via channels such as:
- Social Media
- Display ads
- Website development
Then you need to consider any profit you’re sacrificing with the promotions, packages, or incentives you run to get travellers to convert to guests. Of course, there are a number of ways to ensure you cost of acquisition is as low as possible. This includes building a smart strategy that revolves around targeting the right guest personas, creating offers that further appeal to your target market, and displaying value for money to potential customers. All of this will drive up your conversion rate.
Another way to ensure your conversion rate is high, is to make it extremely simple for guests to find and book your hotel directly. Using a hotel booking engine enables you to easily take direct bookings and payments on your own website, social media channels, and from metasearch channels. Need a full guide to online booking engines? Check out our blog here.
Convincing guests to book direct with your hotel: How digital technology fits in
Digital technology is now the dominant force in driving more direct bookings and improving guest experience at your hotel. The prominence of consumers using digital technology and businesses implementing digital strategies has skyrocketed in the past few years.
As of 2017, UK travellers are booking online 76% of the time – and this behaviour is no longer restricted to the young either. A retail study by Deloitte shows 78% of non-millennials are now using digital devices either two or three times throughout their shopping journey.
The technology at play including social networks, mobile and cloud computing, and analytics tools, is a perfect fit for hotel businesses to utilise in their endeavour for more direct business and a smoother booking process.
Despite the uptake of digital technology, people still want the personal touch. They want to feel like you know them and receive friendly customer service even on top of the speed and convenience technology gives them.
Building real relationships with guests is one path to a vital competitive advantage.
While personal service can get lost in the digital age, digital technology can also help you build stronger relationships than ever with your customers.
The good news is that with every new piece of digital technology comes a new opportunity to analyse your guests and their behaviour. Tracking as much of an individual’s digital footprint as possible will put you in a good position to understand their preferences and even predict their intentions.
This highlights the need to deliver relevant information in a timely manner. By analysing customer behaviour, you’ll be in a much better position to offer a personalised service and target direct bookings.
The importance of hotel technology integrations in winning direct bookings
Once you’ve done the work to find the right guests and attract them to your website, your technology and service has to remain at a high standard. The most important aspects are:
- All your touchpoints must be user-friendly
Ideally you’ll have a quality online booking engine that can process bookings in a quick and easy two-step process.
- Guests need to access your website on a mobile
The mobile optimisation of your website should be at the top of your list if you want to convert anywhere near the amount of bookings you should be.
- Your booking engine and website need to be integrated
Allowing your website and booking engine to engage with each will ensure a seamless and hassle-free experience for the booker and also make your life much easier by saving you time.
- You should manage your booking engine with a channel manager
Using a channel manager means you can manage and update your direct bookings the same way as the bookings you receive via OTAs. It means your inventory is automatically updated when a direct booking comes through, and you’ll have access to key performance reports to see how your direct channel is contributing to your overall revenue goals.
Supplementary direct booking tactics
Book direct campaigns can be delivered in a number of creative ways but there are some fundamentals hotels should also make sure they get right for the customer.
Here are some quick tips:
- Take a focused approach to marketing copy
It’s impossible to please everyone and it’s unlikely every segment will be attracted to your hotel anyway. So it’s better to research your most relevant target group and create content that will appeal to them.
- Perfect your hotel email marketing campaigns
Email marketing can still be a great way to drive direct bookings. Get people to sign up by offering something in exchange, creating an opt-in for other offers, and set up autoresponders. Always take a warm and personal approach to emailing your guests and potential customers.
- Drive a high volume of traffic on your hotel website
Getting people to actually land on your website is a big step. The best way to do this is to create a blog and post regularly, across relevant and interesting topics travellers are likely to read.
- Take a focused approach to marketing copy
Travellers booking direct: Why a channel manager might help
You may think an online booking engine and an optimised website will do the trick, but a channel manager can be just as important for direct bookings and is the final piece of the puzzle in making your hotel booking strategy profitable.
Although you will use your channel manager to connect to online travel agents (OTAs) for increased global distribution and reservations, it holds an extra benefit:
The Billboard Effect
When you have your rooms listed on a number of OTAs, travellers from all over the world have the chance to see your property and make a booking. However, they may not choose to do this on the OTA itself, given that travellers rarely visit just one site during their booking journey.
Often they’ll also visit your own website in the hopes of finding a better deal, package, promotion, or more information. This could result in a direct booking for you but it would not have occurred if you didn’t distribute your rooms across the OTAs and gain visibility.
If you want to take advantage of The Billboard Effect to reduce the commission you pay to OTAs and make direct bookings your most profitable sales method, you need two-way integration between your channel manager and online booking engine.
Hotel direct bookings: Website visit length is key
Regardless of what kind of information the visitor is searching for, if they can get it from your hotel’s website, they are much more likely to book one of your rooms.
Why is that, you might ask?
On a basic level having lots of good information on your website helps ‘place you in the community’ keeping you front of mind for the visitor, which in turn makes your hotel look like it is in tune with what is going on in the area. Being an informative and helpful resource to a traveller is a good look for your hotel brand.
But on a more scientific level, there’s some web-browsing psychology at work here. Having a lot of quality content on your website means visitors are likely to spend longer on your website, which means they’re also likely to want to do business with you and book a room.
One of the key metrics for any website is how long someone spends on it – also known as visit length. This is good for search engine optimisation – meaning the longer people spend on your website, the higher it will appear on the rankings of search engines such as Google, when people actively search for terms like “hotels in Sydney”.
So, without getting knee-deep into technical processes, in order to boost the number of people staying in your hotel who found you on Google, you need to convince them to spend as long as possible on your website.
Visit length relies on having a lot of very good content that’s of genuine interest. Three of the top five techniques to increase visit length can be achieved by simply writing interesting and good quality blog posts, web pages, and guides on things to do in the local area:
This does not just mean that each page on your hotel’s website is free of typos and grammar errors (although that is important). It also means that the content topic is of deep relevance to the service you’re offering. For example: guides on things to do and local attractions as provided by a hotel business is great quality content, but an article on the best movies from the 1940s would be pointless (unless there’s a local cinema with a vintage film festival on of course…)
Multiple Page Articles
Rather than write one long page that lists everything you can do in the local area, break it down into sections. For example:
- Food to Eat
- Ways to Unwind in the City
- Places to Explore
By taking this approach you’ll have your visitors clicking from page to page a lot more, reading a higher volume, and keeping them on your site for longer.
Having a section on your hotel’s website (a bit like the classifieds) where local businesses can provide menus, photos, opening hours would turn your hotel’s website into a helpful hub of information, which has people clicking through to it more frequently, and spending longer on researching the information they’re looking for.
By increasing the length of time that people spend on your website, you are delivering a key part of your website’s strategy, making visitors more favourable towards your hotel, and helping boost your Google ranking in order to attract, reach, and convert visitors from all over the world.
- There are many reasons to fight for direct bookings – less commission fees is just one of them
- A unique offering from your hotel is important in getting guests to book direct
- Extras can prove a nice incentive for guests to book direct at your hotel
- Simply improving the way you use images could improve your direct booking conversion
- You need to work hard to any barriers that are in the way of a guest making a direct booking
- Stay vigilant about using tactics to reduce abandoned bookings
- Digital technology can actually help you foster a more personal relationship with guests
- A channel manager can help deliver direct bookings via the Billboard Effect
- Keeping travellers on your site for as long as possible increases the chance of a direct booking