Online travel agencies (OTA's) have had a significant impact on the adventure industry, with approximately 60% of travelers now purchasing tickets through platforms like GetYourGuide and Trip Advisor. While the demand for these digital distributors is becoming hard to ignore, it raises the question of whether the benefits outweigh the high commission percentages, which can reach up to 30%.
In our hunt to uncover the true worth of collaborating with OTAs, we dove deep into industry data to find what benefits stood out. We also explored effective strategies for managing these relationships.
In this blog, you will learn the top 3 benefits of working with OTAs and 3 recommendations on navigating OTA relationships on YOUR TERMS.
Table of Contents1. Benefits of OTA's
The combination of innovation and problem-solving is a driving force behind business development. When these two elements converge, a solution emerges that brings ease and positive gains to all those involved in the business idea. This is precisely what led to the creation of online travel agencies (OTA's).
Viator, arguably the first online travel agency, was established in 1995 to provide customers with a solution for finding and comparing various activity options. Since then, numerous companies have emerged to offer similar solutions. However, the challenge with their business model is that while they have become exceptionally skilled at what they do, it is to the point that they can inadvertently create a barrier between you and your potential customers instead of acting as a channel, if not approached strategically.
Here are the advantages of strategically partnering with OTA's in your business.
1. Increased Exposure
Companies like Viator/Trip Advisor have spent the last two (2) decades learning how customers think, how they search, and how to keep up with the ever-evolving technologies of the day.
Because of this, they have become specialists at getting in front of people whom they know are looking for activities or travel offerings (YOUR POTENTIAL CUSTOMERS). Not to mention that they have marketing budgets that can reach in the millions.
Therefore, OTA's have established a strong presence on Google due to several factors.
- Firstly, their strong brand recognition instills trust in customers.
- Additionally, OTA's have perfected the digital purchasing experience by storing credit card information, making it convenient for customers to make repeat purchases.
- They also provide a platform for reviews, giving buyers confidence in their choices when comparing multiple offerings.
- Moreover, OTA's often offer competitive or discounted prices, further enhancing their appeal to customers.
On top of that, Google has recently re-introduced Google Things To Do, a specialized search platform for travelers looking to book trips and explore recommended activities. This platform gives priority to optimized offerings, putting OTAs at a significant advantage when it comes to visibility on this platform. (Go see for yourself - Google "things to do in Atlanta" and see what listings show up at the top)
The ultimate goal is to ensure that travelers searching for offerings similar to what you provide can easily find your business. Online travel agencies (OTAs) excel at placing their listings in front of these specific travelers. By partnering with a well-known OTA and listing some of your offerings, you can greatly enhance your visibility on Google. This enables potential customers who may be challenging or expensive to reach to discover your business.
However, read on to learn our recommendations on how to be strategic with what you offer on OTA's and how to take the most advantage of these power-house selling machines.
2. Optimized Selling
As mentioned earlier, OTAs invest significant time and resources into understanding the thought process and search patterns of buyers. They constantly gather data to gain insights into the subtle nuances of human behavior when making purchasing decisions.
Working with an OTA offers a significant advantage because not only does this data help improve the visibility and sales of your listings, but the OTAs also outline and even sometimes handle the optimization process for you.
GetYourGuide, a leading travel platform for booking tours, attractions, excursions & activities shares how they will provide optimization suggestions based on performance analysis taken from GetYourGuide data. The system will automatically indicate the areas that can be improved such as sales or content and will outline the actions you should take to improve optimization.
OTA's want your offerings to sell just as much as you do so their expert insights can help you keep reservations coming. And remember, this optimization knowledge doesn't have to stop with the OTA offerings. Read below for our recommendations on how to use this knowledge to simultaneously boost your direct bookings.
3. Simplified Marketing
With the ever-evolving effectiveness of digital searching, consumers are adapting their behaviors accordingly. OTAs, with their high rankings on Google, have become the go-to search platforms for many buyers. While some still choose to make their purchases through an OTA, a recent survey revealed that 43% of those using OTAs for their search will ultimately book directly.
By listing your offerings on OTAs, you make yourself visible to these buyers who are actively researching to find the best deal or to avoid booking fees charged by various booking sites. This not only increases your exposure but also adds value while reducing your acquisition costs that could otherwise be spent on paid ads.
So, while nothing is truly free, having just a single listing with an OTA can provide a return on investment beyond the bookings it directly generates. This is particularly advantageous if you are not currently investing in paid ads (and an expensive agency who manages them for you)
FLYBOOK INTEGRATES WITH REZDY TO SCALE OTA DISTRIBUTION - READ MORE
2. Recommendations For Working with OTAs
While the benefits of working with an OTA are certainly appealing, it is essential to acknowledge that most OTAs charge a significant commission percentage. At The Flybook, we have developed direct integrations with popular OTAs like GetYourGuide, Viator, and Airbnb, allowing us to understand the various ways tour operators, outfitters, and adventure resorts can strategically collaborate with these platforms to their advantage.
1. Negotiate
Although the commission percentages charged by OTAs may appear to be high (30% is a significant portion), it is worth noting that some OTAs are open to negotiating their share, especially if you have a unique offering or operate in a location where they have limited options.
OTAs aim to establish themselves as the go-to platform for travelers to book their activities, and to achieve this, they need to provide a wide range of offerings. This is where your offerings come in. By partnering with an OTA, you become an essential part of their diverse inventory. As a result, they are often willing to engage in negotiations to secure your offerings on their platform.
Remember, OTAs are eager to attract a variety of offerings in order to cater to the needs of different travelers. This presents an opportunity for you to leverage your unique value and negotiate a more favorable commission rate.
2. Learning From the Data
Take advantage of the data-driven insights from OTAs to optimize all aspects of your listings, not just the ones offered through the OTAs. These platforms analyze SEO and behavior analytics to determine what is popular and trending in their bookings. By reviewing their recommendations, particularly regarding naming conventions and images, you can make adjustments to all of your offerings to maximize the knowledge that the OTAs have uncovered. This strategic approach will help you capitalize on the latest trends and improve the overall performance of all of your listings.
3. Get Creative With Your Offerings
When partnering with an OTA, you don't have to list all of your offerings. In fact, you can strategically choose a single unique or standard offering that will attract travelers to your site and showcase everything you have to offer. This approach is especially valuable during off-seasons when direct bookings may be lower.
While it's understandable that you don't want to give a 30% commission on a booking that could have come directly, you can create a slightly modified offering that the OTAs can list while limiting their availability. This way, you can avoid competing against yourself and still benefit from the exposure provided by the OTA.
For example, if your specialty is 1-1 guided fishing tours, you have the opportunity to create a distinctive offering. Consider adding a unique touch, like providing a complimentary shirt or a small giveaway that adds value to the guest experience, to make your offering even more enticing. You can adjust the price accordingly to account for these additional perks. This particular offering can then be exclusively listed through OTAs, allowing you to manage it separately while still benefiting from the exposure they provide.
Flybook Reservation Software allows inventory and resources to be used across any or all offerings. Giving you the opportunity to split activites while still sharing the same resrouces. This keeps you from being overbooked and allows for management of availability. - Learn More
In the ever-evolving travel landscape, online travel agencies (OTA's) have reshaped the adventure industry. Because these platforms are capturing a significant amount of travelers bookings (remember 60%!) working with an OTA is certainly worth discussing. With benefits such as enhanced visibility, optimized performance, and cost-effective marketing, adding this channel to your distribution strategy becomes a must-do.
However, being strategic is how to make sure this relationship benefits you first. So, when entering into discussions around listing on an OTA don't forget to negotiate for a commission rate that is best for you. Make sure to leverage their data to optimize all your listings and lastly be selective and creative with the offerings you list on the OTAs.
Looking to Manage More and Grow? The Flybook Reservation Software Can Help.
