2. More domestic and even local customers.
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Less need for air travel and, therefore, for packaged sales (the big loser here is Expedia).
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Greater relevance of the hotel brand and repetition rate, which again greatly facilitates direct sales over intermediated sales.
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Same language and time zone. As many customers are local, it’s much more convenient to contact the hotel via the website or phone for answers to questions or bookings. And as it’s a local call, it doesn’t cost anything, unlike an international call.
3. Greater agility of online channels to reactivate quickly.
Opening an extranet takes a matter of minutes, while reactivating a tour operator, travel agency or even wholesaler always takes much longer, especially for short-term sales.
Reactivating flight operations requires sustained demand over time, something that has not happened until very recently and is still very timid. Staff returning from temporary lay-offs or investments in marketing to stimulate demand are actions that also take time.
For this reason, customers were often only able to book hotels online and, for the most dynamic hotels, moving to direct sales was not a difficult challenge.
4. Internet as an escape route from continuous confinement.
We’ve spent months locked up at home, with very few outings. The internet and mobile devices, in particular, have been our travel companions for long periods.
For many months, the only way to book a trip was online. This has helped many to lose the fear of booking and buying online.
5. Lack of group, MICE and corporate segments.
As we noted earlier, for many hotels there are key segments that are still experiencing tough times.
This means that all those resources that are normally reserved have been made available for leisure and online as a lifeline. An unintended consequence for other hotels, however, is that they are now competing with these hotels based on price.
6. Loyalty has its rewards.
Those hotels that had identified and nurtured loyal customers were able to lean on them to start their recovery and generate those first few bookings without the need to turn to OTAs.
What could be a better way to return to normality for many customers than to go to a hotel they already know? This again demonstrates the strategic importance of loyalty.
7. Bad experiences with intermediation during the pandemic.
Although there are many different stories out there, it is rare to find someone who has not had serious difficulties managing a non-refundable airline ticket or hotel reservation.
Many hotels disappeared and never responded, but those who turned to their customers and their direct sales made a lot of headway for the reactivation of the sale.
Aware of this situation, OTAs such as Booking.com took the unilateral decision to defend “their” customers and convert bookings from non-refundable to flexible, triggering a storm for many hotels and great displeasure with the intermediary that showed its bitter side.Booking.com took the unilateral decision to defend “their” customers and convert bookings from non-refundable to flexible, triggering a storm for many hotels and great displeasure with the intermediary that showed its bitter side.
8. Better conditions on websites than OTAs.
Although many hotels, including almost all major hotel companies, already offered better conditions on their direct channel than OTAs.
Those that are maintaining this strategy, combined with an increase in visits to their websites, has had a multiplier effect, achieving great results for direct sales.
Conclusion
Although direct sales had been gaining ground every year, the pandemic has created a before and after for many and, instead of being just another channel, direct sales has become a strategic asset that should be cared for and promoted.
Of course, many of the variables that have led to this growth will gradually change and return to normality.
To think that this will last forever is naive. But it would also be naive to assume that everything will return to the way it was before.
Many of the changes that have occurred over the last 16 months will no longer be circumstantial but structural, offering a great opportunity for hotels to consolidate and further enhance their direct channel strategy.
Remember that direct is not a goal in itself and no hotel can survive on direct sales alone.
What is important for any hotel is to maximise profitability and create a sustainable model without having to depend on an intermediary.
In the search for this balance, it is clear that direct selling has, and will have an even more fundamental role from now on.
Pablo Delgado is CEO of Mirai