Hotels Enjoy Interoperability Advantage with Online Distribution

Hoteliers work in a challenging environment, with one of the most perishable goods – a room night, where every single day, in fact in some cases minutes; a decision needs to be made. Room rates fluctuate, occupancy needs to be monitored and allocations need to be done to various channels and all of this in real time. Here, we look at ways to minimize complexity through interoperability and an integrated approach.

Online Distribution Complexity

To understand the complexity that a hotel deals with on a daily basis, let’s take a look at the main channels for hotel distribution:

1. Online Travel Agents
2. GDS
3. Web Booking Engines
4. Travel Agents
5. Corporate Accounts
6. Meta Search Engines

For all of the above channels, the hotels need to allocate room nights and set the rates. The hoteliers who are able to accomplish this in real time struggle less with over bookings and unoccupied room nights.

A Complex Scenario made Simple

Let’s assume a scenario where room nights have been allocated to OTAs and GDS. Currently the hotel has only 7 room nights available for direct bookings. A travel agent calls to make a group booking of 15 nights.

In the case of a hotel that does not have the channels integrated, the hotel needs to release allocation given to OTAs and GDS and then make a booking for the travel agent. To make the situation complex, if an online guest makes a booking online at the same time, then that needs to be accounted for as well. There could also be a scenario where the room nights are available with the OTA but a guest is unable to book online because of unavailability with the hotel.

On the other hand, a hotel that has achieved interoperability between channels through integrated channels does not need to allocate room nights manually and all the above gets done automatically. Room nights are allocated in real time to OTAs and GDS. Travel Agents and Corporates can be connected through online consoles. Web booking engines also have access to real time room availability information making sure that a hotel does not have an unoccupied room night because of delay in allocations.

Interoperability and Increased Occupancy

Online distribution gives maximum advantage if it is integrated and interoperable. An unoccupied room because of blocked room nights is a hotelier’s nightmare. On the other hand, overbookings resulting in unhappy customers can create big problems for the hotel and its online reputation, with social media and customer reviews playing a big role in today’s well connected traveller’s life. Travel Agents and Corporates can also be made more efficient with online consoles to manage their accounts. A hotel is able to empower all available online channels to achieve maximum advantage out of them through integration. This in turn results in increased occupancy and higher revenues.