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How Do Online Travel Agencies Affect the Hotel and Vacation Accommodation Industry?

If you are planning and booking a place online for a vacation or business trip, you will definitely come across some Online Travel Agencies (OTAs) such as Agoda, Travel Consultant, Expedia & Booking.com. These OTAs have been around since the late 1990s and early 2000s, and have been growing in size, power and popularity every year, so that when you place an order in the online marketplace, you can't avoid them. online travel rules; everything from hotels, villas and rooms to cars and bicycles, as well as flights – you always see a handful of OTAs on the Google homepage and at the same time dominate Google Adspace. Of course, with the rise of these monster-sized travel agencies, there is an increasing concern that hotel owners, car rental companies and third-party booking portals need to get more direct bookings to avoid wholly or completely. . Of course, the reason for concern is the loss of profits that businesses receive when they buy orders from agents rather than directly from consumers; rates are slightly different from each agency, although no% will be so small that they do not have a significant impact on the providers' bottom line. For example, 15-35% commission is required to pay OTA for each booking received from hotel and homeowners, the% value depends on the location of the property / hotel as well as the number of rooms listed. OTA (The higher the room, the less the commission they will pay for OTA).

With this great expense from OTA's partnership, you may wonder: "Why do Hotels and Resorts continue to rely on third-party booking agents when Hotels and Resorts enjoy greater profit margins than direct orders?" This is something that all living providers think and discuss with them and their teams, and the answer is that many are now in a situation where they just can't survive without OTA reservations. If a hotel or Resort is so self-centered and not so popular that they can fill their rooms successfully all year round, they have to stick with one OTA or more. can live. In fact, when booking rooms in popular and popular hotels and resorts I mention, there will be lower seasons and other times and events, and additional room / villa reservations will be needed; Thus, in fact, OTA's partnership is a must for all companies that are currently on strike.

Where did this OTA come from and who owns it?

Speaking of OTA, most people are really key players providing really aggressive marketing activities to make sure that all travelers often see their brands and promotions online and offline. which will describe several companies. . The four most popular OTAs are Expedia, TripAdvisor, Agoda & Booking.com; These are the room-changing platforms that make the biggest change in the market, and will be on the list of most Hotel owners for the partnership. Of these four agencies, the oldest two are Expedia, which was created in 1996 by a small division of Microsoft, and then in 1996 in Amsterdam, Booking.com. Visiting Advisor occurred in 2000. A small office in Massachusetts, USA, arrived in Agoda, established in 2002 and from Bangkok, Thailand. In fact, almost all major OTA and online ordering platforms are owned by only two major, monster-size organizations and are under the umbrella; Expedia Inc. One and Priceline Group.

So to answer the original question of this article asking how OTA & # 39; s impact on the vacation booking industry; it has been greatly improved by making it more accessible to the consumer and easier and more efficient in comparing different areas of user experience. Earning extra revenue by checking the reviews of each location before ordering is another positive change that consumers can enjoy. On the other hand, it has had a number of negative effects as well as positive effects for living providers. For better ranked listings on OTA websites, commission and overhead costs are higher than the profits earned by homeowners, but on the other hand, many hotels, resorts and other accommodation providers have already booked more rooms on OTA's websites, At the same time, their brand / location is on the map, and good rooms will be able to grow over time, thanks to the support they receive from OTA partners if it is an effective service.

In general, I think OTA is positive for the sector.