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Getting Around Rate Parity Agreements With OTAs

November 21, 2018 at 8:52 pm · · Comments Off on Getting Around Rate Parity Agreements With OTAs

Getting Around Rate Parity Agreements With OTAs

This has been a difficult one, and more and more countries are kicking OTAs rate parity agreements into touch.

For now, in the UK it seems like the independent hotelier doesn’t have the clout to utilise their own loyalty programme incentives enough to get around rate parity like the big boys, but there are still ways to achieve direct bookings at ultimately attractive rates by using utilities such as the ‘Special Offer’ feature on Trip Advisor’s Business Listings.

Offer a discount or upgrade or some other incentive, but let it be known that this only applies to direct bookings made on the hotel’s own website by entering a promotional code on the booking page.

Another way to get around rate parity is through packaging – including a meal with a two or three night stay, or a spa treatment or a complimentary upgrade, at a price which when compared to the OTA offering has obvious appeal. This can be done on a ‘Special Offers’ section on your website.

Really it seems like the OTAs are most concerned with price parity being maintained between them and their competition, with them constantly trying to outflank each other by offering hoteliers optimised exposure in exchange for reduced rates (then when you go for it, all the other OTAs contact you too, asking [demanding!] that they receive that discount too…)

One hotelier I know consistently displayed marginally lower rates on his website than those made available to the OTAs, and when questioned said that his direct booking rates were calculated in relation to foreign currency conversion rates and were updated bi-monthly, and they seemed to swallow that, and he consistently landed direct bookings of all the most cost conscious guests – sure, they didn’t spend much at the hotel, but at least they were ‘commission free…!’

Germany, Austria, Italy and France have all shrugged off the OTA burden of rate parity agreements, but for now it’s up to UK hoteliers themselves to see the best way to circumvent such constraints and incentivise those vital commission-free direct bookings…

Best of luck!

What are your views on the Rate Parity debate?

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