Direct hotel bookings actually cost twice more than indirect channels

Travel News 12 Aug 2016

Did you know, average room prices listed on hotel websites are nearly double that found on third-party booking channels such as OTAs and metasearch engines?

In an article on TTG Asia it was revealed that the average reservation made on indirect channels amounted to SGD$457 over a 12-month period ending June 2016. Over the same period, the average cost of bookings made on direct sites was SGD$806.

The finding highlights the continued lack of education among hoteliers on the prevalent issue of rate parity and the value of direct bookings, stated hotel booking solutions provider SiteMinder.

“Our data shows that hotels globally are charging the online consumer 1.8 times more, on average, for accommodation booked via their own direct website than via OTAs and other third-party channels,” Mike Ford, managing director of SiteMinder said.

“While we can’t forget the reach these third-party sites provide to hotels, the commissions they receive are up to a quarter of a booking’s total value.”

He adds: “Today’s finding is particularly concerning at a time when we are witnessing unprecedented efforts from hotel brands to attract guests directly and to challenge anti-competitive laws that inhibit rate parity. It means we as an industry clearly need to do more to help hoteliers understand how they can help themselves and stop being their own enemy."

SiteMinder’s finding is based on 43.5 million reservations that passed through the company’s Channel Manager and TheBookingButton solutions between June 2015 to June 2016.