Hotel Execs Reveal New Revenue Priority: Making More from Loyalty
Summary
Hotel companies are leveraging loyalty programs as revenue engines, particularly through co-branded credit cards. They're also shifting bookings away from OTAs, where commissions are significantly higher, favoring direct bookings. These strategies aim to boost customer acquisition and competitive advantages in the hospitality sector.
Key Insights
- •Direct bookings typically cost hotels roughly 4% to 5% of revenue to acquire, versus OTA commissions that top 15%.
- •The biggest hotel groups are increasingly treating loyalty as a revenue engine through co-branded credit cards, partnerships, and subscriptions.
Action Items
- ✓Consider implementing a direct booking strategy for your STR to reduce reliance on OTAs and decrease acquisition costs.Effort: mediumImpact: medium
- ✓Analyze your current distribution channels and commission structures. Determine if you can shift more bookings to direct and or through repeat customer marketing.Effort: mediumImpact: medium
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