Contributed by Matt Braddy, Key Client Success Manager, SHR
The OTAs are here to stay. Their marketing is ever-present on a global scale, their potential to generate bookings cannot be denied, and they have the ability to bring you new guests that may not have otherwise found your property. Staying in parity on all those channels can be difficult. This is a necessity, though, for one main reason; OTAs advertise that shoppers will get the best price for a room by booking on their site, and have aggressive low-price guarantees that are costly to their business and brand reputation when a customer finds a lower rate elsewhere. To stay true to what the OTAs (and by extension, your hotel) are promising, your rates must present as consistent. It can seem a daunting task, but there are steps you can take to keep your channel bookings flowing more freely with less worry and resources spent. To use these most effectively, however, it's important to first understand the concept of rate parity.
What is Rate Parity and Why Does it Matter?
Rate parity, ideally, provides a level playing field of room rates from which guests can shop and book in a fair manner no matter where they discover your property. It matters because inconsistent room rates can cause frustration, confusion, lost bookings, and loss of visibility on some OTAs. Those are problems no hotel ever wants to experience. Additionally, no guest wants to feel they have been cheated out of their best rate or have missed an opportunity. Having a more consistent rate on all channels from which your hotel is visible can help alleviate these problems.
What are the Biggest Challenges to Staying in Parity?
When you're working on channels where you don't have a direct connection, it can be especially difficult to achieve rate consistency across the board because all availability, rate and inventory (ARI) changes must be made manually in each channel's extranet. Plus, if you don't have channel managers for more regional and/or up-and-coming OTAs other than Expedia and Priceline, the demands on your time or your team's time and the margin for human error can grow exponentially. Added to the mix are hotel metasearch sites like TripAdvisor, Kayak, Google Hotel Ads, Trivago, Ctrip, and Agoda, which have grown to outpace even AdWords. These sites pull in and publicly display rates from many OTAs and third-party sites, and deposit the results all in one place. This means that rate discrepancies are clearly and easily visible to highly qualified shoppers that have specific travel dates in mind and are viewing your hotel as a potential place to stay. The point of a metasearch site is to show customers the best rates for a hotel on a given stay period, and, if you participate in the metasearch pay-per-click features, this can drive more business to you-but only if your site is not showing a higher rate.
What are Some Solutions for Staying in Parity?
Working with a CRS provider that has direct connections via an Application Programming Interface (API) to GDS, OTAs, and channel managers is a good start. For instance, as a hotelier, I might use my PMS or my RMS to originate my rates, and this can be a potential problem because all channels speak a different "language" between their respective systems. This is where an API comes in to act as "translations" between those systems. The APIs send an electronic message from the hotelier such as, "On April 3rd, I want the sell rate for my standard room to be $140." This goes from your PMS to your CRS then from the CRS out to the world via the API. The API is that connection that speaks the common language for all systems and can help automate rate changes across multiple channels' systems, lowering your chances for falling out of parity. This enables a more streamlined data exchange that translates into more accurate rates, room availability, and a more satisfying overall booking experience-for you and for your guest.
But what if, after all this, you get a note from your OTA that you are out of parity after all? We recommend that your first line of action should be to check for caching issues on the channel's site that is flagged as out of parity. Some sites will only update a rate that displays on their site when a guest tries to make a reservation and the rate is no longer valid, or when that site has not yet updated the rate in their cache when the rate shop occurred. If it's not a caching issue, then it's usually a good idea to reach out to your contacts for the channel to identify the issue, so you can fix it with them directly.
The Importance of Solid Support
When all is said and done, technology like direct connects, channel managers, and APIs are only as good as the support that comes along with them. With so many links in the distribution chain, it can be difficult to track down the root cause of an issue you might face that is impacting your ability to stay in parity. Therefore, you must partner with a CRS provider who will be there for you with support to help you track down problems when they occur, and communicate on your behalf when necessary.
Staying in parity can seem overwhelming sometimes, but with the right CRS technology and strong support, you can keep on top of things, making it easier for you to keep your focus where it should be—on your guests and hotel business strategy.