As the busy travel season approaches, hotels are anxious to put heads in beds. With more consumers taking control of their own travel plans, hotel managers may decide that display advertising at online travel agent sites will not generate a sufficient yield. But research by Cornell’s School of Hotel Administration says otherwise.
Cornell University researcher Chris Anderson regularly reviews the practices and results of hotel operators who maintain their own websites and also advertise on online travel agent sites (OTA). Using comScore data, Anderson studied the behavior of consumers who visit travel-related websites. Anderson found that consumers who ultimately went to a branded hotel site to book a reservation had been elsewhere first:
- OTA: 75%
- Major search engine like Google or Bing: 83%
- Search engine and OTA: 66%
As consumers searched for travel data, they visited an OTA at least 12 times and spent an average of 5 minutes viewing 7.5 pages. This adds up to almost 1 hour of content exposure and 90 page views. As a result of the exposure to hotel brands on the OTA sites, consumers exhibited what Anderson calls the billboard effect. They were influenced by what they’d seen and often went to the hotel brand’s website and made a reservation. Anderson measured a 7.5% to 26% increase in reservations when a hotel posted an ad on an OTA site. Put another way, “for each reservation at the OTA, 3 to 9 reservations at the brand’s website are directly influenced by listing at the OTA.”
Hotel operators should study this situation and determine the best way to present their online promotions at an OTA and to also negotiate the proper margin level to be paid to an online travel agent for each reservation that is tracked through the website.[Source: Anderson, Chris, Ph.D. Search, OTAs, and Online Booking. Hotelschool.cornell.edu. April 2011. Web. 26 Apr. 2011]