Customers follow the path of least resistance, maximum comfort and optimal security when it comes to booking a hotel. As a hotel, how much are you helping travellers in booking directly with your hotel?
How to increase direct hotel bookings?
[pullquote]Travellers want to know for sure that they have got the best rate while booking.[/pullquote]
One of the biggest factors which impact direct bookings is the issue of rate parity. And if the rate is different on different agencies and the hotel website, there is always going to be an element of mistrust.
Rate parity can be defined as maintaining consistent rates for the same product in all online distribution channels – Expedia, Orbitz, Cleartrip, Agoda etc regardless of what commission the OTA makes as well as the hotel’s own website. It ensures an even playing field among all channels and protects hotels relationship with its partners, as there is no channel bias.
If an online booker finds rate disparity, they are likely to take advantage of it. For example lower rates on an OTA in comparison to the hotel’s own website will drive more bookings through the OTA and costing additional commissions.
On the flip side, OTAs are likely to be against promoting a hotel which offers better rates on the hotel’s own website. While there is still a lot of debate over the application of rate parity, it is clear that it reduces confusion and simplifies the booking process with the travel booker seeing consistent pricing across all channels of distribution. Having rate parity can help keep the brand equity on the same level to ensure that there are no cheaper rates available on dissimilar markets.
If you are an independent hotel and wondering what you can do to achieve rate parity, please read through our selection:
Does rate parity limit revenue managers?
If you ask any revenue manager whether they practice rate parity or any pricing consultant whether they advise their clients to practice rate parity, the answer is without-a-doubt “yes”.
How can you maintain rate parity and still beat the OTAs?
If you use online travel agencies to generate business for your hotel, you have inevitably come up against the term rate parity. In fact, you likely have a rate parity clause in your contracts with some or all of your OTAs.
6 strategies to increase direct bookings without conflicting your rate parity agreement
Online travel agencies such as Expedia, Priceline and Hotels.com are extremely good at what they do: filling empty rooms. Unfortunately for hotel operators, they have become slightly too good at it, and travellers are attracted far more to these third party sites for their booking needs.
Rate parity : The battle to determine how you buy hotel rooms
Did you ever wonder why a hotel room search returns identical or near-identical results from all the online travel agencies and metasearch engines? One major reason is that hotels agree to give same price to everyone who asks for a given booking.
The 4 essential hotel parities – Rates, Content, Rooms and Market
We know that maintaining rate parity is one of the biggest challenges in the online distribution of hotel inventory, but what we often overlook are other parities that can influence your chances of increasing direct bookings.