Increasingly, we book our hotels through Online Travel Agencies (OTAs) when we want to go on a holiday.
By “OTAs” we mean one of the humongous hotel search engines like Expedia, Hotels, Booking, Priceline, Agoda etc. The OTAs have gotten bigger each year, and they are acquiring smaller competitors and making affiliation agreements. As a result, what seems to be competing companies to the outsider, often belongs to the same owner.
These OTAs have a vast database of hotels in many categories, and almost everywhere in the world. The websites are easy to use, incorporates maps and images of the hotels, and on top of that, their rates are generally competitive. All good reasons to book your hotel from the convenience of your armchair.
But before you rush to your armchair, here are 5 reasons you might want to pause and think before you click that tempting “book now”-button.
Wait, something is not right here…
Should any unexpected issues arise before or during your trip, you are on your own. Issues that frequently arise include issues with the hotel room or facilities, visa issues, flight delays and schedule changes etc. You have to find out who to contact, how to contact them, what your rights are, and the most effective way to solve your problem. On top of that, you will be the one to blame if elements of your holiday are disappointing – there is no agency to blame or help you solve your problem.
Have you booked your hotel through an online hotel supplier – good luck getting a hold of their customer service. They are not exactly famous for providing quality customer care. Their business plan is simply not centered around customer service beyond what you can find on their website yourself, their business plan is focused on selling you room nights at low rates and making it easy for you to buy, and that’s what they are good at.
Time spent searching on 15-38 websites!
If you actually quantify the hour$ you spend on putting your holiday together yourself, you will suddenly find that the extra cost of using a travel agency is a good bargain, unless of course you enjoy spending time researching the hundreds of options and consider this a fun part of preparing for your trip. Depending on which study you look at, web-surfers visit from 15 to 38 websites on average when they book their holiday. Wow! Sometimes all the information out there can be more bewildering than informative.
In case you want more than merely a hotel, using a travel agency will save you several additional hours of tiresome research. An agency can help you with booking flights, transfers, guided tours, car rental, travel insurance etc. making it a one stop shop for all your needs. And how about baggage allowance information, visa rules, and special meal and seat requests? That’s why some travelers still choose to use a travel agency.
Do you like healthy competition?
In the same way as your mum prefers to buy her sun cream in a local store instead of paying slightly less for the exact same product in the city, so it works with buying your hotel room. By buying at the huge online hotel suppliers you save a little money, and at the same time you reinforce a system where the majority of worldwide trade is controlled by a handful of huge players.
If you own a hotel, chances are that nowadays customers are not going to find you, unless you are present on at least one of the major hotel booking sites. They provide an opportunity to expand your market reach by a huge factor. However, because you need them to fill your rooms, the big players demand high commissions and net rates that are well below the rates they allow you to offer to smaller agencies and even feature on your very own website. And they check you, so be careful trying to undercut the price you have given to the big players. Should you be caught, they can simply punish you for violating their price guarantee and remove your hotel from the website. In a second your hotel lost 70% of your expected bookings. There has also been reported instances of online booking engines claiming a particular hotel to be sold out and suggesting a similar hotel instead. But actually the hotel is not sold out, but the commission might be higher at the other hotel, so your hotel is “sacrificed” in the process. In this way, a few big companies control the destinies of a great number of hotels. Some hotel owners and tourism suppliers in general are figuring out how to win back more control. As an example, have a look at www.christinatravelclub.org.
If you are interested in reading more about the sentiments and strategies for hotel decision makers regarding the relationship with big online travel agencies, the website www.hotelnewsnow.com is a really good place to start.
Are you special? Or do you want something special?
The simpler and more standardized the product you want, the more suitable the online booking website will be for you. Conversely, if you have special needs or if you want something out of the ordinary, you might not find it on the hotel booking sites. We then recommend you to contact the accommodation provider directly with your requests and questions or let a travel agency handle your special arrangement. Many of today’s successful travel agencies are specialized in certain types of travel products. This could be tours for senior singles, golfers, Harley Davidson bikers, surfers, physically handicapped, geologists, wine aficionados, group tours with Chines-speaking tourleaders, danger tourists, and numerous more specializations you wouldn’t even imagine existed. Any niche travel market that demands unique insights, specially trained personnel, and connections to people who can give access to extraordinary experiences is, not surprisingly, best served by experts in that particular field.
“But by booking online I’m eliminating the middle man”
Not really. The big OTAs are middle men just like any other travel agent. The big difference is that while your local travel agency will do most of the work for you and assist you with all kinds of things if needed, the online bigs prefer to avoid personal contact and leave responsibilities to you. Then it’s your mistake and not theirs if any issues occur. So in that sense, the middle man is eliminated, when you need him or her the most! Talking about middle men, often even the big players use sub-suppliers on their products and thus do not contract with the end-supplier directly. Just like any other industry nowadays, tourism is full of wholesalers, sub-suppliers and sub-agents adding extra layers between end-supplier and end-client , but also helping turning the expanding wheels of the industry. To sum up, the only way to avoid any middle man is to contact and pay the hotel directly – often at a slightly higher cost for you, but to the delight of the accommodation provider.
For consumers, OTAs have no question made it easier to book holidays, research opportunities, and compare selling prices from various agents. Every year the number and proportion of OTA bookings rise. There are many good reasons to buy your hotel online on the Expedias and Pricelines. However, they don’t fit all purposes and functions, so consider your motivations, needs, flexibility, and your gut feeling when deciding how to arrange your next holiday.
Interested in reading more about the issues related to the growing dominance of OTAs? Here is a great article on the subject by Valere Tjolle of TotemTourism: OTAs move to dominate customer relationships – can it ever be green?
Update: Expedia has now bought Travelocity and Orbitz, another huge player in the online hotel market.