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How to Use the Billboard Effect to Increase Hotel Direct Bookings

billboard cover (1)

 

 

Increasing direct bookings is, of course, any hotelier's main objective. The OTA Billboard Effect for Hotels can help you increase direct bookings while also generating more revenue for your hotel.

There's no doubt that today's travelers are looking for as much flexibility as possible. Direct booking channels offer flexible cancellation and refund policies and the option for last-minute changes. Therefore, it is beneficial to take advantage of the OTA Billboard Effect.

Not only do direct bookings save you money on commissions, but they also give you more control over your inventory and guest experience. In this blog post, we’ll explore how you can use the billboard effect to increase your hotel’s direct bookings. 

 

What is the Billboard Effect?

 

The "Billboard Effect" is a term used in the hotel industry to describe the increase in direct bookings that hoteliers experience as a result of being listed on third-party websites like online travel agencies (OTAs) and meta-search enginesChris Anderson, an associate professor at Cornell University, first described the billboard effect in 2009. As per Expedia, having a listing on an OTA website increased direct bookings for hotels by 65% in 2017.

 

How Does the Billboard Effect Work?



Infographic outlining how the OTA billboard effect works.

 

Through OTA listings, the billboard effect acts as a huge online billboard to promote your property, ultimately increasing traffic and revenue for your business. According to Expedia, OTAs have the most engagement, accounting for over 30% of all site visitors.

This is due to the fact that potential guests typically discover a hotel on an OTA. They then go directly to the hotel's website for further research and ultimately book on the hotel’s website due to its more favorable rates and exciting bookable services not listed on the OTA.

By utilizing third-party websites like OTAs and meta-search engines, you are able to reach a wider audience and tap into new markets. This allows you to generate more revenue and grow your business.

 

3 Strategies To Drive More Direct Bookings Using the OTA Billboard Effect

 

1. Be visible online and list your property on multiple OTAs

The 'OTA Billboard Effect' is created by listing your hotel on as many booking portals as possible. You cannot control where guests book, but you can lay the groundwork for them to book with you directly since they saw your property on an OTA they trust.

 

If you are listed on multiple OTAs, you improve your chances of travelers finding your property and visiting your site. 

 

By listing on well-known global OTAs, you will ensure a steady volume of visitors to your site, improving the likelihood of a direct booking, while listing on niche OTAs will drive more qualified traffic with a greater chance of conversion.

 

2. Optimise your website for direct bookings

 

As a hotelier, you should optimize your website to boost Google rankings and attract more guests. 

Also, it is an excellent way to obtain commission-free direct bookings and ensure that guests are persuaded to book directly with you and not on OTA websites.

 

Your website should be engaging, informative, and easy to navigate. If you want guests to book a stay with you directly, make sure the booking form is easy to find, and all relevant information is clearly displayed. 

 

It is also essential that your website has a user-friendly booking engine that is more convenient than OTAs to ensure guests book directly on your site.

A savvy approach would be to improve and expand your offerings by offering special deals and discounts, adding extra services that are only available through direct bookings, and optimizing the overall booking experience.

 

3. Utilise channel management software to be everywhere at once

 

A channel manager can help you take advantage of the Billboard Effect by effortlessly distributing your availability, rates, and inventory (ARI) across popular travel sites and on your website. 

A channel manager helps keep your room rates competitive and manages your inventory so that you don't overbook your rooms. This is essential if you want to use online travel agencies and booking websites, as it takes away the need to spend all day updating your availability and changing your offers.

The more OTAs you utilize, the more direct traffic you will get. Additionally, you'll have access to key performance reports to see how your channels contribute to your overall revenue goals. 

 

The Pros and Cons of OTAs VS Direct Bookings



Pros:

 

  • OTAs provide an additional distribution channel for hotels to reach potential international guests.
  • Direct bookings allow you to gather guests’ data to cultivate meaningful relationships and loyalty in the process.
  • Reduced online marketing spending. OTAs will invest in marketing and advertising to attract potential international customers.
  • An average booking value increases by 2X as a result of direct bookings made through your booking engine.

 

Cons:

 

  • While listing on an OTA is free, every sale made by an online travel agency is subject to commission. This can be anywhere from 10% to 20% of the gross price.
  • Direct bookings often require a lot of sales and marketing across metasearch channels like Google Hotel Ads, which can be time-consuming.
  • OTAs have restrictive cancellation terms.
  • If not listed in the OTA, you are not in the “mainstream” and probably losing your piece of the pie.
  • The amount of customer data you obtain may be limited by some OTAs. This is intended to lessen the likelihood that you will market directly to that consumer the next time they want to make a booking.

  

Final thoughts 

 

Boosting hotel direct bookings with the billboard effect is definitely worth considering. However, keep in mind that you must choose your OTA listings carefully and make sure your website is clear and compelling. 

 

The billboard effect can be an effective tool for increasing direct bookings if it is planned and executed carefully.

 

Finding the ideal balance is the key to success. There is no reason why working with OTAs has to be unpleasant. Use their influence to your advantage, but don't rely solely on them. 

 

Work with an OTA to promote your hotel, but make every effort to encourage guests to book their next reservation directly on your website.      

 

Direct communication with your guests will help you establish a good rapport. In order to not only draw potential guests but also keep them coming back, think about providing value-added goods as a thank you for making a direct reservation with you.

 

For more information on how to increase direct bookings, sign up for a free 30-day RoomRaccoon trial with a local product expert.

  

Author: Justine Smith