Can't do it without ranking?
Booking Genius and Expedia Travel Ads rank your hotel #1. Among money burners! Are we saying that one more discount or the next special offer on OTAs won't do anything?
Well … No.
It's a tad more complicated than that.
But let's start at the beginning. One thing is clear: any hotelier would be happy to be ranked first on Booking.com or Expedia. Landing there doesn't seem that complicated at first. Good ratings, favorable prices and a complete profile are suggested again and again as the top tips. But then, it is still not quite so easy to achieve this top ranking in the end. So you might want to fall back on Genius or Travel Ads.
But now the questions arise: Does this highly coveted "first place" actually exist? And what about the ranking ads that some business intelligence tools so eagerly advertise? We take a closer look and explain how you can manage to position your hotel perfectly today.
OTA Ranking today – how does it really work?
Until some time ago, OTA ranking was quite straightforward. All users saw hotels in the same order. It used to work like, say: the current Bundesliga table. No matter on which TV channel it is shown or through which search engine you find it, the ranking of the teams is the same.
Now, however, hotel ranking is much more complex and depends on numerous factors: A complete profile with an appealing description and attractive pictures, good guest reviews, available inventory and a solid click-to-book ratio are therefore still important.
In addition, there are now some new criteria. These include a person's individual search behavior and cookies on their computer, past bookings, preferences stored on the OTA and specified search criteria. The terminal device used (e.g. laptop, smartphone or tablet...), as well as the IP address also play a role.
With the help of all these points, the algorithms of the OTAs compile a personalized list for each user.
Universal rankings, as they used to exist, are therefore obsolete today. Nevertheless, some business intelligence (BI) tools still insist on showing a ranking list. However, as we now know, this is not universal and should by no means be taken as absolute.
So if there is no fixed ranking, what should you look for if you want to improve your performance on OTAs?
The price-performance ratio as the most meaningful measured value
Today, every user gets a personalized search result with hotels that are relevant to them. A good price-performance ratio is extremely important to perform well in this comparison.
Think about what your hotel offers in contrast to the competition and what differentiates you positively. Then look at how guests perceive your price-performance ratio. Reviews on relevant portals and in your CRM tool will tell you. When you analyze the competition, price is of course one of the first and most important points of comparison. But beware. Price alone is not the deciding factor for guests when choosing a hotel. This is where the price-performance ratio of your comp set comes into play. How do guests feel about it? And how does your hotel compare?
The Price-Rating Matrix provides exactly this information in real time. So you always know how you compare to the comp set and can always make the right decisions. How does my hotel get "to the top"? Even though there is no fixed first place, it is of course still possible to positively influence your positioning on the OTAs. This will generate more OTA bookings and increase your occupancy rate. Improved visibility on online portals also strengthens the billboard effect, which in turn leads to more direct bookings.
So, in a roundabout way, we come back to our holy grail. Besides the obvious points (complete profile, etc.) you have two options to increase your reach.
The Price Rating Matrix shows a snapshot of your positioning in terms of price and rating compared to that of your competitor set.
The simple solution – for a quick buck
Solution #1 is simple: in exchange for more visibility, pay higher commission to OTAs or participate in discount promotions for their members. This works in the short term, but it also comes with higher distribution costs and increases your reach only as long as you pay.
This is a good strategy if you want to sell a few extra rooms quickly, for example because a large group canceled at the last moment. Also, during quiet times, this can help generate more bookings. But that begs the question: wouldn't an email campaign be better for generating direct bookings? That saves commissions, and if it doesn't work out, a special promotion on the OTAs still works afterwards ...
The sustainable solution - for long-term success
Solution No. 2 is a bit more elaborate: you focus on ensuring that your price-performance ratio is always right and thereby optimize your positioning. Four steps are important for this:
- Update prices in real time: keep an eye on themarket and especially on your comp set so that you can identify changes in price levels and demand in time. Adjust your prices accordingly, so that your hotel offers the best value for money if possible.
- Maintain OTA Profile: That your profile needs to be complete and the images attractive should be obvious. Go one step further and update it regularly, e.g. with new, seasonal photos or revised descriptions. Test different ways to keep optimizing your profile. Nothing is set in stone!
- Focus on service: Where and how can you improve the guest experience and value for money? Find out what travelers particularly like about you and build on that. Also ask what could have been better and work on the most frequently mentioned points.
- Actively work with reviews: Hotels with more recent reviews tend to rank higher on OTAs. Therefore, ask your guests for feedback when they check out. With the help of a CRM, you can automate this step to guarantee you reach all guests with this request. Bonus points if you respond to these new reviews promptly.
As you can see, this sustainable solution is an ongoing process that requires more time and effort than a quick special promotion. However, it also gives you the chance to generate more bookings and revenue in the long run if you are consistent in your implementation.
A BI tool that automatically keeps you up to date on changes in the market will save you valuable time in the process. You can make well-informed decisions faster and thus always maintain your optimal positioning.
Then you can finally confidently do without expensive advertising programs from the OTAs. Instead, you can look forward to more high-quality bookings at better conditions. If you can hardly wait to implement this in your hotel now, get in touch with us.
Our experts are already waiting in the wings. Drop us a line right away:
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