6 Hotel Distribution Channels You Need to Know About

Keeping your hotel fully booked during both high and low seasons is a challenge that requires you to be present on various distribution channels.

But to build a successful hotel distribution strategy, you need to know what your options are in the first place.

Which distribution channels are going to bring your hotel the most exposure?

Which ones are the most profitable, and which ones might not be the right fit for you?

In this article, we aim to answer those questions—and more—by presenting 6 different types of hotel distribution channels you need to know about.

So let’s dive right in!

Direct Channels

The first category of hotel distribution channels we’re going to cover in this article is the direct channels.

As the name suggests, this category includes the channels through which your hotel can sell rooms directly to guests, without going through third-party intermediaries that charge commission fees.

This makes direct channels an extremely important part of your hotel distribution strategy, as investing in them can help you increase your hotel’s profit margins.

So, let’s start with your strongest ally—your hotel website.

Hotel Website

In this day and age, having a modern, user-friendly website where your guests can book rooms directly with you is non-negotiable.

According to research conducted by YouGov, 39% of the surveyed travelers consult the hotel website before deciding whether they want to book a room at it or not.

Yes, this means that you have to put your best foot forward and optimize your website to attract prospective guests.

But it also means you have the opportunity to reduce your dependency on third-party platforms and turn your hotel website into your most profitable distribution channel.

Namely, a PwC study shows that hotels—both large and small—miss out on a significant amount of revenue by being overly dependent on indirect distribution channels, such as OTAs.

Illustration: WebBookingPro / Data: PwC

With that being said, abruptly cutting off third-party platforms you sell your rooms on might not be a smart move.

However, there are steps you can take to make a sustainable transition and start earning more direct bookings.

The first step is making the reservation process on your website quick, easy, and secure for your guests.

To facilitate this, you should consider opting for a direct booking engine, such as WebBookingPro.

A web booking engine like ours is bound to become a key component of your website, as it makes it possible for your guests to check room availability and make reservations autonomously and within only a few minutes.

As you can see below, the room reservation page powered by WebBookingPro is seamlessly integrated into the website, thus ensuring that the hotel brand image remains consistent.

Source: Heritage Hotel Tisno

Apart from the fact that the booking process is intuitive, it is also completely safe for your guests.

Namely, the entire reservation process—from checking availability to making the payment—takes place on your hotel’s website, meaning your guests don’t have to worry about their data being compromised.

In short, a user-friendly website, complete with engaging photos of your rooms and amenities, as well as a seamless booking process, is a must-have for every hotel.

So, if you haven’t started optimizing this just yet, now is the time to do so.

Phone Reservations

Another important—albeit a bit more outdated—direct booking channel you need to know about is phone reservations.

Even if you’ve made sure that booking a room directly through your website is intuitive and completely safe for your guests, the reality is, many people still prefer to book a room the traditional way.

The findings of Phocuswright’s white paper corroborate this.

Illustration: WebBookingPro / Data: Phocuswright

As you can see, a significant amount of guests still rely on being able to call your hotel to get a room.

Whether it’s because they don’t feel entirely comfortable entering their credit card information on an unfamiliar website, or purely because they prefer the personal touch of a phone call, it is your duty to make this experience pleasant for them.

So, how can you go about that?

While large hotel chains often have call center teams solely for taking over-the-phone reservations, this might not be a viable option for smaller or independent hotels.

If this is the case for you, don’t worry—you can still offer a superb phone reservation experience in-house.

Start by training your front desk staff how to take reservations over the phone.

Firstly, provide guidance on how to effectively communicate with guests and discuss the tone and language your staff should use.

It also might be helpful to develop a script they can follow at the beginning of every phone call.

For example:

Source: WebBookingPro

Having a simple script like this can help your staff members clearly communicate with your guests and ensure they have a positive experience.

But being friendly and actively listening to the guest won’t do much if your staff isn’t well-versed in using your hotel’s booking system or isn’t knowledgeable about the hotel itself.

Therefore, it is advisable to thoroughly train them on how to check room availability, explain what room types and amenities you offer, as well as apply discounts, and answer commonly asked questions.

On top of that, Tamie Matthews, CEO and founder of the revenue management company RevenYou, advises providing your staff with a tablet for further streamlining reservations.

Illustration: WebBookingPro / Quote: Preno

Imagine the inconvenience of a guest calling to make a reservation, only to be dismissed because the front desk clerk has a line of guests that need to be checked in first.

A tablet can help mitigate that uncomfortable situation, allowing your staff to promptly take care of over-the-phone reservations.

Although they are a bit old-school, phone reservations are still an important direct channel that can bring you bookings, so make sure not to underestimate it.

Indirect Channels

While direct channels are something you want to strongly focus on in your hotel distribution strategy, the undeniable truth is:

Indirect channels—from OTAs to GDS—are a huge player in the travel industry and are favored among a significant number of travelers.

That is why, in the following sections, we’re going to discuss 4 of the most popular ones.

Online Travel Agencies (OTAs)

The first indirect distribution channel on our list is online travel agencies or OTAs.

Illustration: WebBookingPro / Data: Expedia

You may be wondering why OTAs are such a popular choice among travelers, even though booking directly with a hotel often comes with additional perks.

The short answer is, because OTAs provide travelers with an overview of all the hotels in a specific location, thus making it easier for them to find the right one.

Having to research dozens of hotel websites individually can be overwhelming and time-consuming, which is why travelers love turning to OTAs like Expedia, Booking.com, or Hotels.com for a comprehensive overview of their options.

Source: Booking.com

Aside from the fact that OTAs make the job of booking the perfect hotel easier for travelers, they also carry benefits for hotels.

Namely, if you’re the owner of a smaller, independent hotel with a limited marketing budget and located in a bustling area, it is going to be difficult for you to compete against bigger players in the game.

So, if you can’t beat them, join them.

Being present on popular OTAs is going to expose your hotel to a broader audience and increase the odds of travelers choosing to stay with you.

Given the fact that, as we mentioned earlier, OTAs ask for fairly high commission fees on each reservation, you might be reluctant to do so.

However, completely dismissing OTAs can actually make you miss out on direct bookings, research shows.

Illustration: WebBookingPro / Data: Otamiser

That’s because many travelers use a two-fold approach to booking:

  1. They first discover the hotel on OTAs
  2. Then they book that hotel directly through their website

So, rather than either completely ignoring them or fully relying on them, try using OTAs as a marketing tool to get more direct bookings.

Metasearch Engines

Metasearch engines are another indirect distribution channel that is very popular among travelers and very important for hotels.

These engines consolidate hotel room prices and availability from multiple different channels, such as OTAs and hotel websites, thus allowing travelers to easily compare their options and make direct bookings.

Below, you can see some of the most popular metasearch engines for hotels.

Source: WebBookingPro

So, how can you start listing your hotel on platforms like Google Hotel Ads and Tripadvisor?

The most straightforward way to do that is to connect your hotel’s CRS to the metasearch engine(s) of your choice.

For instance, with WebBookingPro, this task takes no more than a few minutes.

Once you’ve enabled the Google Metasearch/TripAdvisor connection between WebBookingPro and the metasearch engine, it is going to take them between 24 and 48 hours to start showing your property.

After that, every change in your hotel’s room availability and prices is going to be synced automatically, thus ensuring consistency and rate parity between your website and the metasearch engine(s).

Max Starkov, founder of the marketing solutions provider HEBS Digital, explains that over 50% of direct bookings are, in fact, direct referrals from Google.

Illustration: WebBookingPro / Quote: HEBS Digital

So, if you’re looking to increase the number of direct bookings with the help of third-party platforms, but don’t like the high commission rates of OTAs, metasearch engines might be an option worth exploring.

Travel Agencies

The next indirect distribution channel on our list is travel agencies.

Much like their online counterparts, traditional travel agencies serve as intermediaries between your hotel and your guests.

Data shows that, with the rise of online bookings, the influence travel agencies once had has diminished, but hasn’t completely disappeared.

Illustration: WebBookingPro / Data: Statista

As a hotelier, you’re probably wondering why travelers would go through the hassle of researching travel agencies, finding one that offers the best value for their money, and then paying additional service fees on top of it all.

Not to mention the fact that, since a single travel agency most likely doesn’t have a partnership with every single hotel in the desired area, this approach limits their range of options.

As it turns out, travelers who prefer booking trips through travel agencies do so for convenience.

Illustration: WebBookingPro / Data: Statista

So, what does this mean for you and your hotel?

Simply put, it means that nurturing relationships with traditional travel agencies isn’t something you should completely dismiss.

The Reddit comment below goes to show that, when planning a trip seems daunting and logistically complex, people tend to turn to travel agencies for help.

Source: Reddit

But although partnering up with a travel agency can help your hotel get more visibility, it also comes with some downsides you need to consider.

For starters, similarly to OTAs, travel agencies are going to charge your hotel a commission fee, which is bound to reduce your revenue.

On top of that, there is no guarantee that working with a travel agency will pay off, as they most likely won’t be able to consistently recommend your hotel over others they work with.

So, what’s the verdict—should you partner with a traditional travel agency?

The answer is: it depends.

If the feedback you’re getting from your target audience shows that they prefer booking through a travel agency, or if planning a trip to where your hotel is situated can get complex, it might be the right fit.

So take a step back, evaluate, and use your best judgment to make the decision.

Global Distribution Systems (GDS)

If you’re considering establishing a partnership with a travel agency, you need to know about global distribution systems, also known as GDS.

Illustration: WebBookingPro / Data: SiteMinder

In simple terms, a GDS is the middleman between travel agents and your hotel’s CRS.

With the help of a GDS, the travel agents you work with can see which room types are available and what their prices are in real time.

Once they’ve booked a room at your hotel on behalf of the client, the GDS is going to transfer the information about this booking to your hotel’s system and automatically remove the booked room from the inventory.

That way, you don’t have to worry about going back and forth with the travel agent or risk overbooking your rooms.

Apart from travel agencies, companies whose employees travel for business a lot also rely on GDS to efficiently manage business travel arrangements and get better rates at partner hotels.

Illustration: WebBookingPro / Quote: Revenue Hub

On top of that, business travelers tend to spend more money on hotel services, thereby further increasing hotel revenue.

So, if you want to attract more corporate travelers, using a GDS can help expose your hotel to more of them, making this distribution channel a worthwhile investment.

But which GDS platform should you opt for?

Maria Santos and Maria Perez from Hotel-Spider, an online distribution system for hotels, explain that this depends on your hotel’s location.

Sabre is really important for the North American market. Amadeus has the biggest network in Europe. Travelport combines providers Apollo, Galileo, and Worldspan so they can cover many regions globally. 

To sum up, building your hotel’s presence on one or multiple GDS platforms is an option worth considering if you tend to work with travel agencies and if you get a lot of corporate travelers.

With the help of this indirect distribution channel, you can directly target your desired audience and get more opportunities to grow your hotel revenue.

Conclusion

With that, we wrap up our list of some of the most important distribution channels every hotelier needs to know about.

From investing in direct channels like your hotel website to establishing a presence on indirect channels where your target audience is, there is no denying that finding the right channel mix is key to your hotel’s success.

We hope that this article has provided you with valuable insights into your distribution channel options and empowered you to improve your hotel distribution strategy.

Copyright© 2009-2024 Alpha Software Ltd. All Rights Reserved. All prices exclude the legal VAT. Made in EU. All partner brands, websites and logos are trademarks of their respective owners.