SiteMinder Report: Average Booking Value on Direct Hotel Websites Nearly Double that on Third-Party Channels

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The 43.5 million online bookings worth US$16 billion in revenue made by SiteMinder's customers show that the booking value hotels are realising on their direct website is, on average, 1.8 times greater than the value they are receiving from third-party channels.

SiteMinder powers 83 hotel bookings worth more than US$30,000 in revenue every minute

Too many hoteliers are giving OTAs better rates than their own websites which is not smart given the profitability of direct bookings.

The average booking value hotels are realizing on their direct website is nearly double the value they are receiving from third-party booking channels, the global hotel industry’s leading cloud platform, SiteMinder, reveals today.

The finding is based on the 43.5 million hotel bookings that passed through SiteMinder’s technology over the 12 months ending June 2016 to generate US$16 billion in revenue for the company’s 22,000 hotel customers around the world. An analysis of the year-long data found that the average reservation was US$340 through SiteMinder’s Channel Manager, which streamlines online bookings made on more than 350 largely third-party booking websites, while the average reservation was US$600 through SiteMinder’s Internet booking engine, TheBookingButton, which facilitates online bookings on a hotel’s own website.

SiteMinder’s managing director, Mike Ford, says the finding highlights that hotels should be investing heavily in ensuring they have a balanced approach to distribution and that they are focusing on their direct booking strategy in order to maximize direct conversions and therefore profit.

“Our data shows that hotels globally are achieving 1.8 times more, on average, for accommodation booked via their own direct website than via OTAs and other third-party channels. While we can’t forget the reach these third-party sites provide to hotels, it’s important to note that direct bookings are not only achieving higher value overall but there is no commission payable on them so they are very much more profitable,” says Mr Ford.

“Today’s finding not only highlights the need for hotels to focus on direct booking technology and improving their own website and search rankings, but also points to the fact that hotels need to ensure that they are at least at parity with OTAs and other third-party channels in order to compete effectively. Too many hoteliers are giving OTAs better rates than their own websites which is not smart given the profitability of direct bookings.”

The total revenue and reservations generated through SiteMinder’s technology have grown 122 percent and 142 percent, respectively, over the past three years. Every minute, SiteMinder now powers 83 reservations worth more than US$30,000 in revenue for its hotel customer base which spans 160 countries on six continents.

In addition to TheBookingButton – which, alone, powered 1.75 million reservations worth US$1.05 billion in revenue for hotels over the past year – and The Channel Manager, SiteMinder’s technological solutions include GDS by SiteMinder, a single point of entry to the industry’s major global distribution systems, Canvas, the intelligent website creator for independent hoteliers, and Prophet, the real-time market intelligence solution that takes the guesswork out of pricing rooms.

ABOUT SITEMINDER

As the leading cloud platform for hotels, SiteMinder allows hotels to attract, reach and convert guests across the globe. We serve hotels of all sizes with award-winning solutions for independents and groups alike, wherever they are in the world.

SiteMinder’s products include The Channel Manager, the industry’s leading online distribution platform; TheBookingButton, a wholly-branded booking engine for direct bookings via the web, mobile or social; Canvas, the intelligent website creator for independent hoteliers; Prophet, the real-time market intelligence solution that takes the guesswork out of pricing rooms; and GDS by SiteMinder, a single-point of entry to a six-figure network of travel agents and the world’s major GDSs. With more than 22,000 hotel customers and 400 of the industry's top connectivity providers as our partners, today we have presence in more than 160 countries on six continents.

For more information, visit http://www.siteminder.com.

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Maria Franco
@SiteMinder_News
since: 06/2009
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