Building a profitable hotel distribution strategy

Guest lifetime value and ease of booking early in the booking process key factors in hotel distribution strategies

The hotel distribution landscape has changed significantly in recent years, with shifts in booking channels driven by evolving consumer behavior and technological advances.

Key takeaways

• Pandemic-induced shifts: During the pandemic, independent and boutique hotels experienced a significant increase in voice channel bookings. However, this trend has since leveled off, falling short of the impact hoteliers anticipated as guests increasingly return to online travel agencies (OTAs);
• Focus on cost vs. value: The current priority for hoteliers is not just channel choice, but balancing the total cost of customer acquisition with the lifetime value of each guest. Regardless of the channel, achieving the optimal balance between these two factors is now the key objective;
• Stabilized channel mix: Over the past four years, the channel mix has returned to a more stable pattern. OTAs now account for approximately 12% to 12.5% of branded hotel bookings, with higher percentages for independent hotels. In addition, the global distribution system has largely returned to pre-pandemic levels.

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