The Growing Power of OTAs in Hotel Marketing and Revenue Generation

Abstract

How hotels are searched, compared, reviewed, priced and booked has been revolutionized by online travel agency (OTAs), which are a significant mountain in the hotel marketing and revenue generation strategies. Through platforms like Booking.com, Expedia, Agoda, and MakeMyTrip, hotels can gain greater market visibility, reach both domestic and international customers, credibility due to reviews, and other booking opportunities. For small and independent hotels, OTAs are particularly handy because they can be used as a tool that helps to fill rooms which have not been successfully marketed. The surge of the OTA power brings some challenges along with it, including commission costs, price competition, decreased customer foot-in-thedoor, ranking dependency, and a more troublesome direct booking relationship. A number of recent academic journal publications reveal that OTAs affect hotel profitability, pricing, customer behavior and distribution strategy. Thus it is essential for hotels to leverage OTA's well and mix their volume of OTA bookings with their direct bookings, regulate online reputation, boost digital content, and concentrate on the net income instead.