Today I'm going to talk about what I would say to my best friend-hotelier from my 15 year experience in helping hotels selling rooms online.

First, there's a problem we all know about – 70% of all hotel rooms are sold through OTA. Booking.com and Expedia are taking almost three quarters of all online hotel sales in Europe. Hoteliers in Europe spend more than USD 10bn in commissions annually. That's a lot of money.

It's not just in Europe. It also happens in the US. All the giants like Mariott and Hilton, who spend millions and millions of dollars on technology every year, are losing this fight.

So, why is this happening? Why people go to OTA instead of booking from hotels?

We were supposed to be in the internet era, no more travel agencies, no more distribution! In fact, there's more distribution than there were before the internet, now. It doesn't seem to be very logical, but there's a reason why. We all depend on technology, but hoteliers don't have the same DNA as online travel agencies. Hoteliers are selling you an experience inside the hotel, not the technology experience. Moreover, this technology is constantly changing.

Travel is a personal experience, so you want to be personal from the beginning to the end. In the ideal world, the selling process would look like that:

Customer sees my advertisement, Adwords, visits my site, and then he books. After he comes to Madrid, he likes it and he becomes a loyal customer. That would be a dream. But here's a reality how people are buying travel:

It's a total confusion. People tend to see up to 38 websites before they book. It's a lot of surfing, and it's not a moment. These are many moments when this decision is taken. They are called micromoments.

There are lots of these moments. So customers go to Google, to metasearches, to Adwords, and if a hotel wants to be relevant, they have to be everywhere in the path of this search. Otherwise how do you expect to sell a room to this person?

The search for hotels and travel has changed completely because people do a lot of small research. That makes micromoments important. There's a moment when a customer wants to see prices. There's a moment when a customer wants to select some hotels. And then there's a moment when a customer wants to book them. So as a hotel, you need a lot of money to be around your customer during the whole booking process.

It's really hard to be remembered, but it's also very expensive. So hoteliers now have to be on the mind on their customer, as well as wisely spend money on their distribution such as Google Adwords, Trivago, Tripadvisor, and so on.

But hoteliers also understand that in order to make customer acquisition cost lower, you have to be better at converting them. Unfortunately, hoteliers don't have same technology and culture as OTA's. When you go to Booking.com and you see "hey, there are 5 people looking at this website" or "hey, there's just 1 room left, hurry up!". When hotels see those messages they think "Oh, cool, if I put these messages, I solve my problem, I increase my conversion rate and that's it".

But in reality it works differently. Implementation of a technology that is not completely adapted for customer's needs will give a customer a wrong experience.

Example: in the site there's an active promotion with 30% discount, but if you apply a promocode there's no availability of rooms. If no promocode is applied, there are rooms available. This causes confusion and makes the hotel to lose the customer forever in favor of OTA's.

Another example shows that even when a hotel tries to save the customer offering him a promocode before he leaves the website, it's not clear where to apply this promocode. That leaves the customer confused. In the result, the online customer experience is broken. If we just try to use technology by copying others without understanding of what we are doing, we are not able to compete against OTA's.

If you want to make your technology better, you have to invest money to make a good experience, otherwise you are better not to do anything. Moreover, even in the best scenario, if we use all tools like urgency, social proof and scarcity together, they will (pretty unlikely) give you a conversion increase of 6,7%. However, even if it works, on a small website it would not give you much of the improvement. If you are Booking.com, 6% increase in sales is a lot. If you are a small or a boutique hotel, 6% will mean nothing.

People go to the hotel's website to build a relationship, otherwise they will just stay on Booking.com. They don't come to see 10% off for direct bookings. Discounts are good, but they are not relationship that we expect from you. Moreover, you can get the same discount if with Genius discount from Booking.com.

People are looking for a personal relationship. In the last two years, according to Google, searches like "_____ for me" have grown over 60%, so people are like Netflix-dependent, they want something for their tastes. They are even eager to give their data to those players to get this personalization. We talk about GDPR and other stuff, but hey, if you give me a good and personalized service, if you give me a reason, take my data.

I'll show you now an example that has been built by my company with a chain called Iberostar Hotels to inspire you to better apply the technology.

When we look for a hotel on Canary islands on their website, and when you get to the step with booking, the system tells you that we have a present for you, a surprise!

You can choose from two offers: 10% discount + €100 voucher + a spa access, or 10% + €100 voucher + late checkout. You just need to click and the promotion will be applied. There's also a notification that tells you that the promotion has been applied. And then, if you want to leave the website, the system asks if you want to receive the offer on email, because that's what we do: we provide you a service. And if you'll click on the link in email, you'll be brought to the same page with the same hotel, same dates, same promotion.

So with one click we brought you to the place one click away from the booking, and that's the kind of application you should do with the new technology. It's not only technology, but it works much better.

With a personalization done right, you can boost your sales.


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