The article explores the impact of Online Travel Agencies (OTAs) on the hotel industry in the Russian Far East region. The study found that while OTAs are commonly used by hotels in the region, direct bookings through hotel websites are still important for maintaining customer loyalty and increasing revenue. The factors influencing the use of OTAs by hotels in the region include customer demand, ease of use, and cost-effectiveness. The article also discusses best practices for using OTAs in the hotel industry, such as optimizing content and images, monitoring customer reviews, and offering exclusive deals for direct bookings. The study provides valuable insights for hotel managers and industry professionals in the Russian Far East region, as well as for those interested in the broader impact of OTAs on the global hotel industry.
Keywords: OTA, hotels, direct bookings, online travel agencies, hospitality industry, Far East Russia, customer loyalty, pricing strategies, distribution channels.
The hospitality industry has undergone a significant transformation in recent years with the increasing adoption of online travel agencies (OTAs) for hotel bookings. The Far East of Russia, a remote region with a unique cultural and natural heritage, has also witnessed the impact of OTAs on the hotel industry. This research aims to explore the impact of OTAs on the own booking systems of hotels in the Far East of Russia and identify the key factors that influence their use.
Objectives: The primary objective of this research is to examine the impact of OTAs on the own booking systems of hotels in the Far East of Russia. Specifically, the study aims to:
- Analyze the extent to which hotels in the Far East of Russia are dependent on OTAs for bookings.
- Identify the key factors that influence the use of OTAs by hotels in the region.
- Evaluate the effectiveness of own booking systems in comparison to OTAs in the region.
The impact of OTA on the own booking systems of hotels in the Far East of Russia is a relevant and innovative article in the field of hospitality management. With the increasing dominance of online travel agencies (OTAs) in the hotel booking market, it is crucial for hotels to understand the effects of OTAs on their own booking systems and to develop strategies to increase direct bookings.
The article's focus on the Far East region of Russia adds to the novelty of the study, as this region has received less attention in the existing literature. The research conducted for this article provides valuable insights into the current state of the hotel market in the Far East region and highlights the importance of using both OTAs and direct booking systems to maximize revenue and guest satisfaction.
Furthermore, the article provides a comprehensive review of relevant literature, including theoretical aspects of OTA, their impact on the hotel business, and best practices for using OTAs in the hospitality industry. The research conducted for this article and its analysis provide practical recommendations for hotels to increase the usage of their own booking systems and enhance guest loyalty.
The Far East of Russia is a unique and remote region that is rapidly developing its tourism industry. The region's natural beauty and cultural heritage make it an attractive destination for travelers from around the world. However, the hospitality industry in the Far East of Russia faces several challenges, including a lack of infrastructure and limited marketing resources. Therefore, understanding the impact of OTAs on hotel bookings in the region is crucial to the development of the tourism industry. This research can help hoteliers in the Far East of Russia make informed decisions about the use of OTAs and develop effective strategies to maximize their own booking systems.
Literature review
Online Travel Agencies (OTAs) have become a significant source of hotel bookings in recent years. The emergence of OTAs has disrupted the traditional hotel industry by providing a platform for travelers to compare and book hotel rooms easily. This has resulted in significant changes in the way hotels operate, as they now must compete with OTAs for bookings. Research suggests that hotels that are not on OTA platforms may lose out on potential bookings and revenue. Therefore, understanding the theoretical aspects of OTAs and their impact on the hotel business is crucial.
Several studies have explored the theoretical aspects of OTAs and their impact on the hotel business. For example, Buhalis and Law (2008) argue that the use of OTAs has increased the competition between hotels and led to a reduction in their profit margins. Kim and Lee (2014) suggest that OTAs can provide hotels with greater visibility and exposure to potential guests. However, they also caution that hotels may become too reliant on OTAs and lose control over their pricing and branding.
Numerous studies have examined the impact of OTAs on the hotel business in other regions. For instance, Lee and Hsu (2019) found that OTAs have a significant impact on hotel revenue, but the effect varies depending on hotel characteristics such as star rating and location. Another study by Xiang et al. (2015) highlights the importance of hotels' own websites and branding in competing with OTAs. They argue that hotels need to develop effective strategies to leverage their own websites and provide a unique value proposition to guests.
There are several examples of best practices in the use of OTA in the hotel business. For example, Goh and Law (2018) suggest that hotels should focus on optimizing their presence on OTAs by providing accurate and up-to-date information, responding promptly to guest reviews, and offering competitive prices. Another study by Kim and Kim (2016) highlights the importance of maintaining a balance between OTA and direct booking channels. They recommend that hotels use OTAs strategically to reach new customers while developing strong relationships with repeat guests through direct booking channels.
Overall, the literature suggests that the impact of OTAs on the own booking systems of hotels in the Far East of Russia may depend on various factors such as hotel characteristics, branding, and pricing strategies. It is important for hotels in the region to develop effective strategies for utilizing OTAs while maintaining control over their own booking systems.
The main part of the research
Booking hotels is not only the most profitable service in the entire Online Travel market but also the most difficult because of the huge number of different partners that have to work with. For OTAs to build a stable, high-yielding business, it is necessary to have direct contracts with hotels, and on different variants of prices (B2B and B2C), and on the territory of Russia there are from 8 thousand to 15 thousand on different methods of estimation.
In 2011, there was a boom of hotel travel startups that tried to replicate the success of Booking.com and take a share of its market. Ostrovok.ru and Oktogo (Travel.ru) came closest to this, and are perhaps the only Russian companies that are visible in the online hotel booking market today. Ostrovok.ru, in its four years of operation, was able to approach the number of hotels in Russia that Booking.com has (but still falls significantly short). Oktogo also has direct contracts with hotels, but fewer. There are other companies operating under direct contracts, such as "101 Hotel» and «Bronevik», but they were only at the beginning of their journey, with smaller bases, and not always present online. As of 2021, Bronevik has become one of the biggest OTAs in Russia, specializing in business tourism, which was the only sector present during the pandemic that began in Russia in March 2020. Several platforms actually make their bookings through Bronevik nowadays, since the Bronevik base is larger, with around 50,000 hotels provided. However, unlike Booking.com, Bronevik mostly works with B2B contracts, as they are easier to manage.
Since March 2022, the hotel industry has begun to change again, with the biggest player leaving the stage. After Booking.com left the market, it left a huge hole in the tourism industry, and smaller players began trying to fill the vacant place. Travelline dashboard provides clients with information about channels through which online bookings are made. In the Far East of Russia, 53 % of bookings are made from hotels' own modules, and 47 % are made through various OTAs. Ostrovok now stands in first place in this new reality, followed by Bronevik in second place and 101hotels in third.
The study showed that OTAs have a significant impact on the hotel business in the Far East of Russia. Many hotels use OTA as their main sales channel, as they provide access to a large customer base and can help to increase occupancy rates. However, hotels in the region face challenges such as high commission rates and the need to maintain a balance between OTA sales and direct bookings.
One of the main factors influencing the use of OTA by hotels in the region is the need to reach a wider audience and increase occupancy rates. Additionally, the ease of use and convenience of OTA platforms make them an attractive option for many hotels. However, hotels must also consider the costs associated with OTA, including commission rates and potential conflicts with direct bookings.
One of the best practices for hotels using OTA in the region is to maintain a balance between OTA sales and direct bookings. This can help to minimize the impact of high commission rates and ensure that the hotel is not overly reliant on OTA for bookings. Additionally, hotels can optimize their presence on OTA platforms by using high-quality photos and descriptions, responding quickly to customer inquiries, and monitoring and responding to reviews. Finally, hotels can use data analysis tools to track their performance on OTA platforms and adjust their strategies accordingly.
Trends in guests and hotels behavior
In recent times, with the development of technology and the availability of the internet, the behavior of guests and hotels in the Russian Far East has started to change. In this chapter, we will look at the main trends in guest and hotel behavior related to the impact of OTA on their own booking systems.
One of the major trends in guest behavior is the increase in online bookings. With the convenience and ease of online booking systems provided by OTAs, guests are more likely to make their reservations online. This trend has resulted in a decrease in phone and walk-in reservations, which were the dominant methods of booking in the past.
Another trend in guest behavior is the increasing importance of reviews and ratings. OTAs provide guests with a platform to share their experiences and rate the hotels they have stayed at. As a result, hotels are now more focused on providing excellent service and creating a positive guest experience to receive good reviews and ratings. This trend has also led to an increase in the use of social media by hotels to engage with guests and build their brand image.
One of the major trends in hotel behavior is the increasing reliance on OTAs for bookings. With the rise of OTAs, hotels have had to adapt to this new trend and work on improving their relationships with these platforms. Hotels are now offering better rates and more attractive packages to OTAs users to encourage them to book directly with the hotel in the future.
Another trend in hotel behavior is the shift towards direct bookings. Hotels are now investing in their own booking systems and providing guests with incentives to book directly with them, such as lower rates, loyalty programs, and exclusive perks. This trend has resulted in a decrease in commission fees paid to OTAs and increased revenue for hotels.
Overall, the impact of OTA on hotel booking systems in the Russian Far East has led to significant changes in both guest and hotel behavior. These trends are likely to continue as technology continues to advance, and hotels and OTAs adapt to the changing landscape of the hospitality industry.
Recommendations to hotels
Hotels can take several steps to increase the usage of their own booking system and encourage more direct bookings:
- Offer incentives: Hotels can offer special promotions, discounts, or loyalty rewards to guests who book directly through their website. This can be an effective way to encourage guests to choose the hotel's own booking system over third-party OTA sites.
- Improve website design and user experience: A hotel's website should be easy to navigate, visually appealing, and mobile-friendly. It should also provide all the necessary information about the hotel, rooms, amenities, and rates. By providing a seamless booking experience, hotels can increase the likelihood that guests will book directly.
- Utilize targeted advertising: Hotels can use targeted advertising to reach potential guests who are most likely to book directly. This can be achieved through various methods such as search engine optimization, social media advertising, and email marketing. By knowing who to target, hotels can increase the effectiveness of their advertising campaigns and drive more traffic to their own booking system.
- Encourage direct bookings during the check-in process: Hotels can encourage guests to book directly during the check-in process. This can be done by offering discounts or loyalty rewards to guests who book their next stay directly through the hotel's own booking system.
Overall, hotels need to make it as easy and appealing as possible for guests to book directly through their own websites. By offering incentives, improving website design and user experience, utilizing targeted advertising, and encouraging direct bookings during the check-in process, hotels can increase the usage of their own booking system and reduce their reliance on third-party OTA sites.
Conclusion
In conclusion, the impact of OTA on the own booking systems of hotels in the Far East of Russia has been shown to be significant. The analysis of the data obtained through the research highlights the fact that OTAs have a major influence on the booking behavior of customers in the region, and that hotels need to take steps to increase the usage of their own booking systems to remain competitive.
The study has also demonstrated the importance of identifying the key factors that influence the use of OTA by hotels in the region, and how they can be addressed to increase direct booking rates. Additionally, the analysis of the best practices of using OTA in the hotel industry in the region provides insights into how hotels can optimize their use of these platforms to gain an advantage in the competitive marketplace.
Overall, this research contributes to the existing body of knowledge on the impact of OTA on hotels, particularly in the Far East of Russia. The findings provide valuable insights and recommendations for hotels in the region to improve their direct booking rates and reduce their reliance on OTA. Further research can be done to examine the impact of other factors on direct booking rates, such as pricing strategies and loyalty programs.
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