If you are involved in organizing tours and activities, you certainly use different channels for sales. Some prefer selling through contact forms, social networks or an integrated booking system on the website, and others prefer OTAs.
Although OTAs (Online Travel Agency) are a relatively simple solution for quickly listing your travel offer online, it is not recommended to use them as an exclusive sales channel.
The reason for this is simple – your profit margins will always be higher if you sell to your guests directly through your website.
On the other hand, if you use different sales channels, such as your website, OTAs, and offline channels, there is a high possibility for overbooking, unless you have a Channel Manager solution implemented.
The purpose of a Channel Manager is to automatically close departures to prevent overbooking.
This blog will explain what an OTA is, how the booking process works through this channel, and its advantages and disadvantages. We will also show how to connect Orioly with OTAs via Channel Manager and thus avoid overbooking.
OTA is an online marketplace where travel suppliers list their offer. Through it, guests can book products such as tours, excursions, activities, accommodation, and airline tickets.
Some of the most famous OTAs for tours and activities are TripAdvisor, GetYourGuide, Booking.com, and Viator.
Although the way of listing an offer differs from platform to platform, the base is the same for all of them.
Namely, an OTA works in such a way that you create a user profile and set up an offer with details such as the tour name, price, date, time of departure, and photos.
Then, if the OTA approves your listing, you will receive a notification, after which it will be visible to all web visitors and become available for online booking.
Once you’ve completed the sign-up process, you’re ready to get your first bookings.
Travelers will search for the offer based on the date, location, and a number of guests. They can also apply additional filters, such as room type, amenities, or facilities.
Initial communication with potential guests will take place via inbox.
On some platforms, once a reservation has been made, guests can access the contact information you have provided and can contact you in person, either by phone, email, or text.
If you are already selling online through your own website, it is a good idea to check whether your booking system has a Channel Manager or not.
Orioly Channel Manager automatically updates departures between tours set up within Orioly available for booking on your website and the tours available on your OTAs.
The integration between Orioly and your OTAs is done through a connectivity interface called Experience Bank. This platform connects products on both sides and automatically updates availability so that the same departure, after a booking has been created on one of them, no longer has the same number of available spots for booking.
Example: Imagine that your guests can book a tour with you on your website, through the Book Now button, and through Get Your Guide.
Now imagine that one guest booked a tour starting on August 30, 2022, through your website, at 2 p.m. for 3 people.
At that moment, Orioly recorded the reservation and automatically forwarded that information to Experience Bank, which then, through its interface, made three spots less available for booking on Get Your Guide. That is, three people increased the occupancy for that departure.
By the way, Orioly OTA Channel Manager supports integrations with 37 OTAs, among which the most popular are Viator, Expedia, Get Your Guide and Google Things To Do.
That number will continue to grow, and you can check out the complete list here.
Basically, because OTAs can change their business policy at any time, which brings uncertainty to your business.
Generating most of the sales through your own website is recommended. You are the sole owner, and no one can take it away from you.
In addition, OTAs charge huge fees, which can vary from 15% to 30%. This is also a good reason to evaluate whether it is better for your business to invest in a quality website with a booking system implemented, or paying a commission to an OTA.
If you run a tour that costs 50 euros per person and you sell 120 of them per year, this means that from the total amount of 6000 euros, you pay another 20% commission (average) to the OTA which leads to 1200 euros per year.
On the other hand, if you use your own online booking system, in this case, Orioly, you pay a one-time setup fee of 180.90 euros (Startup package) where the online booking commission is 2.5%. This means that for 120 tours sold per year, you will pay a total of 150 euros in commission plus a one-time setup fee, which amounts to the already mentioned 180.90 euros, which is a total of 330.90 euros, i.e. even THREE TIMES less than when using an OTA.
Please note that next year this amount is reduced as you no longer have to pay a setup fee, but only pay online booking fees (offline bookings are not charged).
Our advice would be to invest the remaining difference in the promotion of your offer. It can be a promo video, paid ads on social networks, or Google campaigns.
In addition, it would be useful for you to invest in updating the website because it is your property and you manage it, unlike OTAs who can change the way they do business at any time.
OTA platforms can be a quick and easy solution for setting up your tourist offer online. Still, they should not be a long-term and exclusive solution considering the savings you can achieve by using an online booking system connected to your website.
Therefore, it is recommended that you conduct most of your business through your website. This way, you will have complete control over reservations, display of offers, and analytical data about your visitors.
By implementing a booking system on your website, you can get much more than by selling exclusively through an OTA channel. And very quickly, you get a return on your investment.
Start online direct sales and find out how to set up your account with Orioly here.
on February 1, 2023
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