Over half of hoteliers lack confidence in current rate parity strategies

Over half of hoteliers lack confidence in current rate parity strategies

OTA Insight’s new global survey highlights benefit of revenue management strategies for managing distribution and staying competitive

London, April 30, 2019 – OTA Insight, the cloud-based data intelligence platform for the hospitality industry, today released its 2019 OTA Insight Global Survey. With insights gleaned from 130 hotel professionals representing over 30 countries, the report provides a comprehensive outlook on the current state of hotel management and the need for revenue management strategies, rate parity technology, and data intelligence to help hotels tap into more profitable revenue streams.

Hotels worldwide are looking at another solid year of demand ahead. However, industry experts are bracing themselves for an impending downturn, urging hotels to rein in operational and booking expenses. OTA Insight’s survey taps into hotel management views on what is working and what is not with respect to the future of managing distribution and staying ahead of the curve.

“We surveyed some of the industry’s leading hoteliers and technology professionals, focusing on the challenges they face in order to truly understand business constraints, and gauge their temperature on where they predict the industry is going,” said Sean Fitzpatrick, CEO of OTA Insight, who also wrote the foreword. “Having a clear view of the current landscape offers hotel professionals a roadmap of where revenue is being lost so they can develop new strategies that will ultimately help their business thrive.”

The 2019 OTA Insight Global Survey highlights:

  • Revenue Managers and Rate Parity: Although over 60% of properties have revenue management resources, 51% report feeling unsure or out of control of their rate parity strategy. When asked about the main causes of rate disparity, 59% of hotels pointed to wholesalers, 39% blamed OTAs, 33% believed technology is the root, and 15% claimed metasearch.
  • Loyalty Programs: Despite an industry-wide push for direct business, OTAs gained market share in 2018 in North America, which is expected to increase into 2020. As a push for many properties to work around rate parity agreements, 65% of hotels reported having their own loyalty program, while a surprising 36% still do not have an in-house program on which to rely. When asked if they participate in OTA loyalty programs, 56% reportedly do, while 44% do not.
  • The Future of Distribution and Technology: Though OTAs undercutting revenue remains top of mind for respondents (23%), 32% of hotel professionals foresee Google having the biggest impact on distribution over the coming years. When it comes to where hotels expect to see the most impact from technology through 2019, 61% said data analytics/business intelligence, 43% said artificial intelligence, and 39% said guest experience technology.

Based on these results, OTA Insight found that wholesaler commissions and loyalty discounts are undercutting revenues; therefore, hotel professionals must be mindful of the loyalty programs they offer and place a strategic focus on investing in new technology that will help control costs and increase profitability, while adapting to current and future market shifts.

Of the 130 hotel professionals who participated in the 2019 OTA Insight Global Survey, 70% reported working directly for hotel or hotel management companies and 21% for hotel/hotel technology organisations. The hotel professionals spanned three-, four-, and five-star properties with 56% chain, 35% independent, and 10% mixed.

For more information about these findings, download the full report here.

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Media enquiries: For further press information please contact us at pr@otainsight.com.

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