Hotel Booking Engines VS OTAs: Which Brings in More Room Reservations?

While the opportunities that Online Travel Agencies (OTAs) present in terms of revenue are significant, many hoteliers are opting to maximize room reservations through a hotel booking engine. 

But if OTAs can be a major source of hotel bookings and revenue, why would hoteliers prefer using their own hotel booking system? In this blog, we will weigh the pros and cons of OTAs and direct hotel booking syste,s and why leveraging the latter is the better option for maximizing resources, reservations, and revenue. 

Related article: Top 5 Tips to Optimize Your Hotel Booking System

What's inside this blog?

  • What is a Hotel Booking Engine

  • What is an OTA Booking

  • Comparing OTAs and  Hotel Booking Engines

  • Why Your Hotel Should Use a Hotel Booking Engine

  • Frequently Asked Questions About Hotel Booking Engines

What is a Hotel Booking Engine

A hotel booking engine is an application found on hotel websites and social media pages to process direct online hotel room reservations.

In a nutshell, a hotel booking engine is an application found on a hotel's own website and social media pages to process direct online hotel room reservations. If you've gone to many hotel websites or social media pages, the widget that travelers use to make room reservations online is the hotel booking engine.

If you want to remain competitive in the industry, you must start installing this feature to your website and pages because no matter what size your hotel is, many travelers will expect this kind of functionality from you. After all, convenience is key.

What is an OTA Booking?

An OTA Booking is another form of online booking system that allows travelers to compare and book various travel products and services, including hotel rooms, flights, tours, cruises, and more on an Online Travel Agency (OTA) platform.

For independent hotels, these third-party channels can be especially useful for a hotel's brand exposure and additional digital marketing. Since OTAs have their own promotions, it can augment any hotel's individual marketing efforts. In exchange, each booking is charged with a commission fee that ranges from 3-5%.

Related article: 5 No-Fail Tips to Increase Your OTA Rankings For Maximizing Revenues

Comparing OTAs and Hotel Booking Engines

OTAs are great hotel marketing channels because they serve a wide range of customers and usually provide more choices for accommodations. While more people do prefer looking for hotels because of the room rate transparency and the huge hotel selection, direct booking engines can still compete with exclusive offers, competitive room prices, extended stay discounts, and other special perks that potential guests will appreciate. 

Here are a few ways to drive guests away from OTAs and straight to your hotel website. 

1. Use a Property Management System to maximize hotel booking distribution

A Property Management System (PMS) can be integrated with a hotel booking engine to seamlessly connect your hotel inventory and distribution system with the in-house reservation system.

A Property Management System (PMS) can be integrated with a hotel booking engine to seamlessly connect your hotel inventory and distribution system with the in-house reservation system. By allocating your more popular rooms and exclusive amenities on your website, you can entice more guests to book directly on your platform instead of on OTAs.

A hotel PMS-booking engine integration also makes it easier for hoteliers to monitor and adjust marketing strategies to serve more guests on their website. Hotel managers can respond faster to customer preferences with a few adjustments and create better offers exclusively on their website. 

Must-read: Maximize Your Hotel Bookings with This Property Management System

2. Learn more about room reservation preferences with data collected from a hotel booking engine

Here’s how a hotel booking engine can help you increase room reservations using customer data

What's great about an online hotel booking engine is that it allows you to gather data on how guests are booking rooms, their preferences, the price they are willing to pay, booking patterns, and more. This information can help you determine what packages you sell the most, and areas to focus on to help grow your business. 

Furthermore, the data gathered from a hotel booking engine can help forecast guest demands, changes in the hospitality market, and can help with room pricing strategies and hotel marketing plans. 

3. Use hotel booking engines to offer more secure room reservations than OTAs

Hotel booking through an OTA is less secure compared to using a hotel booking engine.

When guests make a booking, your online booking engine can securely accept credit card payments, and your guest’s data is safely stored and accessible in one place. OTAs, while highly convenient, aren’t always the most secure and private platforms. They can be prone to malware and software bugs due to the huge selection and traffic they get. 

Also, since there is so much information guests have to keep after booking, the hotel booking engine allows guests to keep track of their hotel booking details in one place that they can access any time, anywhere.

4. Guest enjoy more competitive room rates and hoteliers enjoy more hotel revenue with a hotel booking engine

Hotel booking engines offer more flexibility and customization for guests, and higher revenues for hoteliers.

While OTAs are crucial to maximizing hotel revenues, the fact that they ask for higher commission rates gives hotel booking engines the advantage of winning the battle because it is your key to commission-free direct bookings, helping you maximize profitability.

Moreover, OTAs often charge customers higher hotel room rates to compensate for the hotel commissions. With hotel bookings engines, hotels can set more competitive room rates and offer better perks and packages to guests. 

Additional perks are flexibility to put any information, promotions, banners on your website freely. You can also control the guests' journey from browsing your rooms to finally booking them. Finally, it also gives easier payment processing as it does not have to go through a third party channel. 

Why Your Hotel Should Use a Hotel Booking Engine

As previously mentioned, no matter the size, expanding your hotel's visibility online is crucial if you want to stay competitive in the hotel industry. While working with online travel agents can help you increase your reach, having your own booking platform has far more advantages when it comes to creating memorable guest experiences.

Below, we list down key advantages of hotels using their own booking engine instead of online travel agents.

Instantly Bookable Via Your Website

A direct hotel reservation system is the best way to book direct reservations online. With your own direct booking strategy, you empower potential guests to quickly and easily book rooms without the hassle of website redirections and numerous buttons. One click is all it's needed for them to secure a room in your hotel -- which points us back to the concept of convenience.

Zero Commission

OTAs charge commission rates that typically ranges from 15% - 30% from hotels. This is how they earn money. However, by having your own booking engine, you lower your overall business expenses.

Furthermore, if you want your hotel business to be higher up in an OTAs landing page, you have to pay a higher commission fee to secure that spot.

Higher Booking and Lower Cancellation Rate

A study from Mirai revealed that cancellation rates from hotel's direct booking channels amount to only 19% as compared to 39% on and 25% on Expedia. This means that hotels have better and easier control over direct bookers.

Moreover, cancellation lead time is often longer in direct bookings, which gives you more time to resell and potentially regain online bookings.

Easy Payments

Depending on their systems and policies, some OTAs provide several payment options for guests — it could be 100% upfront, 75% upon booking followed by a 25% a week before the booking date. For some guests, this could be a better option as they get to give their payments via installments. 

However, for hotels, this means losing control over how much money you get and when you’ll be able to receive it. For example, a guest books an online reservation via an OTA website which will only commence 3 months later. The OTA can immediately take a 50% deposit for that trip, but the hotel will only receive the payout 7 days after the trip is complete -- which is 3 months later!

Direct bookings, on the other hand, gives you more flexibility and control over payment terms and cash flow. You can even select your preferred payment gateway options, as long as it works best for your business. 

The Customer Flow Is Under Your Direction

The most important thing about running a hotel is curating experiences for your guests. The best way to do this is to personally acquire guest data. Making sure that you connect with them to ensure all their needs and preferences are met is a sure-fire way to make them feel special. 

Your hotel can practically organize each step of the booking and process — phone calls, surveys, check in and check out, and so on. Building a solid mailing list is also one of the direct booking perks that you can enjoy when you have your own booking engine. 

Flexibility on Promotions

As previously mentioned, it's easier to control your resources and booking process with your own hotel booking engine. So to entice your guests to secure direct sales, it's a great idea to offer personalized promo codes and hot deals. This can be your edge among competitors and OTAs. This way, you can wow them by offering better rates.

Google Hotel Ads Help You Get Noticed

OTAs can be a powerful tool to expand your reach to travelers, but this isn't the only way to achieve so.

Google Hotel Ads is a paid service that a hotel can take advantage of to present real-time rates and availability on Google Search results page and Maps. Similar to OTA websites, these listings are able to compare pricing from a range of hotels. For property owners, this can be a beneficial source of more direct bookings as ads are linked to the hotel's booking site.

The major difference between OTA websites and Google Hotel Ads is that this platform work on a cost-per-click model, meaning they only charge hotels for each click to their website.

Integrate the Best Hotel Booking Engine Into Your Hotel Operations

Interested in generating more revenue and hotel bookings? Try zenrooms Booking Engine. Our online reservation system is Asia's leading hotel booking system that increases your hotel's direct bookings by up to 45%.

With this tool, your hotel can enjoy commission-free hotel bookings, manage room rates easily, come up with better offers with its built-in competitor analysis, get real-time reports, and many more! This powerful and intuitive tool does all the work for you, giving you the chance to upsell your other hotel services and improve your hotel's image.

While revenue management is an important business approach in the industry, a holistic revenue performance is also needed. ZEN eManager allows you to do just that. This fully-automated pricing software allows you to customize your pricing strategy, get recommendations from pricing experts, generate pricing one year ahead, and so much more!

With seamless integration, these advanced tools will help the hotel to boost its bookings, especially with the help of built-in dynamic pricing feature.

Interested in generating more revenue and hotel bookings? Learn more by working with zenrooms solutions. Our in-house experts and digital solutions can help hoteliers maximize their hotel's potential and level up their overall performance. Talk to an expert today. 

Frequently Asked Questions About Hotel Booking Engines

What is a hotel booking engine?

 A hotel booking engine is an application on hotel websites and social media pages to capture and process direct online room reservations. An online booking engine works by plugging into your hotel website and processing secure online reservations made through the website.

What advantages do I get from using a hotel booking engine?

 There are a number of benefits of using a hotel booking engine, including a maximized hotel inventory, an insight to booking data and an increase in hotel revenue per booking. 

Do I need a booking engine?

In short, yes. It offers many great benefits. Additional hotel revenue, flexibility to publish your content, and other hotel marketing efforts. OTAs are still crucial in promoting your business, but at the end of the day, having a hotel booking engine will be crucial in maximizing your revenue for your hotel.

What is the best hotel booking engine?

There is no best hotel booking engine, as the hotel system does not work standalone. It requires other systems to make the overall system work flawlessly, for example Channel Manager, Property Management System, or Revenue Management Software. Having them provided by a single provider ensures seamless integration and less issues. ZEN eManager Express provides them all at once, and with the help of AI-backed dynamic pricing, ZEN eManager Express guarantees a boost in revenue as well as in occupancy rate.