Online Travel Agency (OTA) Trend Is Fading, Travelers Switching to Hotel Websites

Online Travel Agency (OTA) Trend Is Fading
Online Travel Agency (OTA) Trend Is Fading, Travelers Switching to Hotel Websites

Amidst the bustling world of online travel booking, a new contender emerges: direct hotel reservations. The convenience of online travel agents (OTA) is being challenged by the simplicity of booking directly through a hotel’s official website. According to recent surveys, a staggering 80% of respondents believe that reserving accommodations directly through a hotel’s website offers better deals compared to using OTA.

“In a study by Inventure-Alvara (February 2023), it appears that hotels are gearing up to compete head-to-head with OTAs,” remarked Nia Niscaya, a Senior Tourism and Creative Economy Expert at the Ministry of Tourism and Creative Economy (Kemenparekraf). This sentiment echoes the growing trend observed in the hospitality industry.

The survey, conducted in February 2023, polled individuals across three generations: Generation X, millennials, and Generation Z. Results indicated overwhelming agreement, with 79.7% of Generation X, 77.4% of millennials, and 83.2% of Generation Z expressing preference for booking directly through hotel websites.

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In the past, OTA was synonymous with affordability and enticing promotions. However, the landscape is shifting towards a new era characterized by prudent spending and sustainable business models.

“OTAs are now focused on revenue generation to instill investor confidence,” noted Nia. Consequently, promotional activities have been curtailed, and service fees have been adjusted to ensure profitability.

Furthermore, OTAs have begun imposing commissions on partner hotels, putting additional pressure on hoteliers. This dynamic has prompted hotels to adopt proactive measures to maintain competitiveness in the market.

“Hotel Santika, for example, offers a five percent discount for direct bookings through their website. This signals a strategic shift towards reclaiming market share from OTAs,” explained Nia. Such initiatives mark the beginning of a new chapter in the ongoing rivalry between hotels and OTAs.

In parallel, hotel occupancy rates have surged in select regions, signaling robust recovery in the hospitality sector. Under the Hotel Indonesia Group (HIG) umbrella, Bali-based properties reported occupancy rates exceeding 90% during the Eid holiday period.

Inna Sindhu Beach boasted the highest occupancy rate at 95%, followed by Truntum Kuta at 91% and Merusaka Nusa Dua at 81%. Notably, HIG hotels in Bali experienced a 9% increase in occupancy rates compared to the previous year’s Eid holiday period.

Similarly, HIG properties in the Nusa Tenggara region witnessed significant growth, with Meruorah Komodo Labuan Bajo leading the charge with an 83% occupancy rate. This five-star establishment saw a remarkable 14% increase in occupancy compared to the prior year’s Eid holiday period.

As the hospitality landscape evolves and competition intensifies, both hotels and OTAs are recalibrating their strategies to stay relevant in an ever-changing market. The battle for consumer loyalty continues to unfold, with direct booking emerging as a formidable contender in the realm of hotel reservations.