Direct bookings are often seen as the Holy Grail of hotel reservations. Countless tech vendors and consultants provide guidance and solutions that help hoteliers get more of them.
But why are they such a big deal? And what can you do to increase them?
In the following blog post, we’ll take a look at why you should invest in boosting your direct bookings and how you go about doing it.
What Are Direct Bookings?
Direct bookings are reservations guests make directly with your hotel. Your website is the most common and widely discussed channel for this. But direct bookings can also come in via email, phone, from walk-ins or the sales team (e.g. contracted corporate business). In any of these cases, no third-parties such as OTAs, travel agents, wholesalers or other intermediaries are involved.
How Do Hotels Process Direct Bookings?
A direct booking’s source determines how hotels process and record it.
Phone and email: If a booking comes in via phone or email, your reservations agents manually key the booking details into the PMS. While this used to be one of the most common ways to book a room, it came with a challenge. Getting a deposit for these reservations was tricky and time-consuming due to the common need for insecure paper/PDF forms that opened up hoteliers, and their guests’ data, to big risks. Today, Digital Authorizations solutions allow guests to safely book and even prepay for these rooms in a flash.
Walk-in: When a traveler decides to stay with you spontaneously, the front desk agent creates the reservation and checks the guest in directly. Everything related to booking a room, such as payment and signing any paperwork, happens right there on the spot. This practice is far less common in the hospitality industry than it once was, but still can happen from time to time.
Website: A hotel’s website is one of the most effective tools for driving direct bookings. It’s a great place to showcase photos of a property, provide information-rich content that goes beyond what may be possible in a social media or review website profile, and it offers hoteliers a chance to make a great impression by providing an intuitive and user-friendly experience. However, most importantly, every hotel website should include a booking engine which enables guests to make reservations directly through the site, share those reservations with the PMS and process payments or credit card guarantees.
When choosing your booking engine, there are two key points to consider:
Payment model: Some booking engines charge a commission per reservation while others run on a monthly flat fee based on your hotel’s room count. Run the numbers to determine which one offers you better value for money.
Integrations: Hoteliers should look for booking engines that have two-way integrations with both your PMS and channel managers. That way your inventory is automatically updated in your system and on all your distribution channels whenever someone creates or cancels a booking. This means less manual work for your team and reduces the risk of errors.
Hoteliers should evaluate booking engines closely to determine which one will provide them with the best chance to capture direct bookings.
Why Do Direct Bookings Matter So Much to Hotels?
Direct bookings bring big benefits for hotels compared to third-party reservations, including:
Savings on commissions: Since no third-parties are involved in direct bookings, you do not pay any commission on them. If you play your cards right, boosting your direct channels can help you significantly lower your overall distribution costs. However, keep in mind that other investments are necessary to drive direct bookings (e.g. managing your website or running ads).
Build a direct relationship with guests: When travelers book via an OTA, the third-party owns the guest relationship and acts as the primary contact for questions, requests or complaints. As a hotel, you often don’t even get access to your guests’ contact details, like emails and phone numbers, from an OTA. It is completely different with direct bookings. Here, you own the guest relationship from start to finish because travelers always communicate directly with you. This gives you access to guest data you can use to personalize your service and build brand loyalty.
Drive more revenue: Once you have contact details for direct bookers, you can proactively reach out to previous guests with special offers and invitations to come back to the property. This enables you to increase your revenue from return guests and can even help you boost the average spend per guest.
Given these benefits, it’s worth often more than worth investing in a direct bookings strategy at your hotel. Now let’s explore, six of the most straightforward ways to
Six Ways Hotels Can Increase Direct Bookings
By taking the following steps, you’ll be well on your way to generating more direct bookings and saving on third-party commission costs.
1. List Your Hotel On All Relevant OTAs
This may sound counterintuitive at first. But travelers often use OTAs as a hotel search engine to get an overview of what’s available. If your property looks interesting on the OTA, people are likely to visit your website as part of their research. That gives you the chance to convert them to direct bookers. This is called the billboard effect. Researchers from Cornell University identified this pattern and found that up to 75% of guests who booked directly checked an OTA first.
2. Implement a User-Friendly Booking Engine
Along with your website, your booking engine makes or breaks your guest’s direct booking experience. When choosing a booking solutions provider, test their reservation flow. Look for a solution that allows people to complete booking in a maximum of two to three steps. The faster and easier you make this process, the more completed bookings you’ll see. On top of that, your booking engine must be mobile-friendly. That’s an absolute necessity given that an estimated 25% of reservations will come in via mobile by 2024.
3. Optimize Your Hotel Website
Since your hotel website is where a large share of your direct bookings come from, it deserves some attention. In fact, it can be thought of as the first touch point in the overall guest experience. Go through your pages like a site visitor would and ensure it’s well-structured and easy to navigate.
Your site must also highlight your hotel’s benefits and its USPs immediately. For that, you’ll need engaging copy and high-quality images that underscore your strengths and showcase your offering. Overall, guests should be able to quickly find the information they need to make an informed booking decision. As you improve the on-page experience, consider SEO best practices as well to help you attract more website traffic in the long run.
Finally, link to your booking engine prominently. You should have a CTA button that says something like “Book Now” above the fold, and ideally somewhere in the header. This same CTA should also be easy to reach as a person navigates through the site, so many hotels will include a “Book Now” button in the navigation. All of this makes reserving a room effortless for those who have chosen your property.
4. Offer The Best Deal For Direct Bookers
Reserving via your website should never be more expensive than booking on an OTA. Ideally, you’ll guarantee rate parity, or you could even have a slightly better deal for direct bookers. Since a monetary direct booking discount can lead to penalties from OTAs, add-ons like free breakfast or a welcome amenity are the safer bet. They can also seem more attractive to travelers than a simple cash discount.
Show your site visitors you’re serious by promoting your best rate guarantee on your website. You could even use a booking engine that comes with a live rate comparison tool. It lists your prices on other channels next to your website’s and provides proof that you’re offering the best deal. As a bonus, this keeps potential guests from clicking away to shop around for better rates on other pages.
5. Drive Website Traffic Through Digital Marketing & Social Media
Digital channels are great for creating awareness of your hotel and its offers. For example, you can build a following on social media by posting engaging and informative content, and encouraging in-house guests to share content about their stay on their own accounts. As you build a following, you can share your latest promotions with the audience to attract more direct bookings.
Running ads is also an option, both using search engines like Google and social media. Test different alternatives to see which one performs best for your hotel. This could include attracting new email subscribers with a lead magnet or generating bookings for special offers. It may take a few tries, but once you’ve discovered your ideal format, double down on it.
6. Build & Nurture Your Email List
There’s a saying in online marketing: the money is the list. This is true for hotels as well, which means it is a very good idea for hoteliers to do things like include a newsletter sign-up in the booking flow on the hotel’s website. People who sign up for your email list are more interested in your offering than your average site visitor, and that means there’s a higher chance they’ll book with you in the future.
The same goes for new guests that are arriving at your property. With their permission, be sure to add them to your email list and stay in touch. You can boost your chances of getting repeat bookings if you regularly share your latest deals or even exclusive offers with these guests. An easy way to capture this information, even for travelers booking via OTAs, is to use a tool like Canary Contactless Check-In, that allows new guests to provide a hotel with their email addresses during the pre-arrival check-in flow.
Once you have built your email list, use data you have from previous stays to segment guests and target them with highly relevant messages. For example, reach out a few weeks before their birthday to encourage them to book a weekend getaway. Or if you know they travel with kids, suggest your summer holiday family package along with child-friendly activities in your area.
While all bookings are good and bring revenue to your property, direct bookings are the most profitable because they allow you to keep more of your hard-earned revenue.
Still, working to boost direct bookings requires an ongoing investment of time and money. For example, you’ll need to continuously optimize your website, pay for ads, manage your social media accounts, etc. But at the end of the day, those efforts can be very worthwhile since direct bookings can have such a strong positive effect on a hotel’s overall bottom line.
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