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How the online travel agencies of the hospitality and leisure industry are affected

If you have planned and booked some accommodations online, whether for vacation or business travel, you will certainly come across some online travel agencies (OTAs), such as companies like Agoda, Trip Advisor, Expedia & Booking.com. These OTAs have existed since the late 1990s and early 2000s, and each year they are growing in size, strength and popularity, so much so that in today's online marketplace you can almost avoid them when booking a type of online travel arrangement; everything from hotels, villas and rooms to cars and bikes, as well as flights – You will always see a handful of OTAs on the front page of Google results, as well as dominant positions in Google Adspace. Of course, with the rise of this monster-sized travel agency, the anxiety coming from hoteliers, car rental companies and other businesses that need to take more direct bookings to fully or almost completely rely on third-party booking portals. , The cause of concern, of course, is the loss of profit that businesses have to bear when receiving their reservations from booking agents rather than directly from consumers; tariffs vary slightly depending on each agency, although it will never be so low% that it will not have a tangible impact on bottom-line providers. Hotel and property owners, for example, are required to pay anywhere from 15-35% of OTA commissions for reservations received,% of the value usually depends on the location of the property / hotel, as well as the number of rooms they have listed in the OTA (the more rooms are listed, the lower the% commission you will have to pay to the OTA).

With this big expense that comes from partnering with OTA, you might think to yourself: "Why Hotels and Resorts continue to rely on third-party booking agents when they can enjoy much higher profit margins from filming direct booking? "is something that all home providers will consider and think about for themselves and discuss with their teams, and the answer is really that most of them are now in a state where they simply cannot live without reservations for OTA. Unless the hotel or resort has gained such prominence and is not so popular that it can successfully fill its rooms throughout the year, then it is a case of having to join an OTA or several to be able to survive. In fact, even with the notorious and popular hotels and resorts I speak of, there will be low seasons and other times and times when booking numbers will be low and additional exposure will be required to make room / villa bookings available; so, in fact, partnering with OTAs is now a necessity for all vacation business companies.

Where did these OTAs come from and who owns them?

Speaking of most OTA people, they will introduce a handful of companies that are truly major "big players" with extremely aggressive marketing activities to ensure that almost all travelers will often see their brands and promotions, both online and offline locations, The four most famous OTAs are Expedia, TripAdvisor, Agoda & Booking.com; these are the room reservation platforms that are creating the biggest change in the market and those that will be on the list of most hotel owners for partnership. Of these four agencies, the oldest two are Expedia, which was created by a small department at Microsoft in 1996, followed by Booking.com, which also originated in Amsterdam in 1996. Trip Advisor comes next in 2000, formed from a small office in Massachusetts, USA, and not least comes Agoda, created in 2002 and originating in Bangkok, Thailand. In fact, almost all major OTA and online booking platforms are already owned and fall under the umbrella of only two major monster-sized organizations; Expedia Inc is one and the other is The Priceline Group.

So to answer the original question in this post, which asked how OTAs are affecting the vacation rental industry; for the user, it really just makes all the accommodations more accessible and the user experience is significantly improved, making it much easier and more efficient to compare different places. Plus, the added benefit of being able to check reviews anywhere before booking is another positive change that consumers can enjoy. On the other hand, there were some negative effects for home providers and also some positives. The commissions and additional costs for better-listed listings on OTA websites greatly consume the profits that homeowners can get, but on the other hand, for many hotels, resorts, and other accommodation providers who have the exposure they get from the listing on within the OTA websites means that they can now get many more rooms booked and at the same time their brand / location is put on the map, so to speak, as long as they provide good rooms at a good price, with effective service, t then they will be able to grow over time because of the support they receive from their OTA partners.

Overall, I think OTAs are positive for the industry.