Since their introduction in the mid-90’s, OTAs have played an important role in driving customers to hotels they might not have found on their own. In their early days, OTAs were celebrated as a great channel for helping to put heads in beds. Today they present a risk for hoteliers who pay them a handsome fee for each booking and often compete, unsuccessfully, for the same search terms.
Today, according to PhoCusWright, OTAs capture 39% of the US online digital booking market. And will reach 41% by 2020, with US$81.4 million in online gross bookings. For hoteliers worried about this trend and looking to drive direct bookings, Google Hotel Ads provides a great opportunity to take advantage of search traffic and get a leg up on OTAs.
While Google has had specialized ad products for hoteliers since 2010, with sponsored hotel prices in Google Maps, today Google Hotel ads spans both Google.com and Google Maps, helping travelers browse hotels on mobile devices and spot hotel deals. According to Google, in the first six months of 2018, the number of leads to partners grew 65 percent year over year.
Let’s look at why Google Hotel Ads are so successful.
When travelers are doing trip research, they might search the name of a hotel, or they might do a search for hotels in the city they are planning to visit. If they Google the name of the hotel, as I did for Fairmont San Francisco, they will see this result in Google. Because Fairmont has purchased Hotel Ads, the first listing is theirs and links directly to their booking engine. If they didn’t have the ad, the first link would certainly be an OTA. With pricing parity, the first listing will likely get the click so you want to be there.
The same is true when a potential guest searches ‘hotels in San Francisco.’ Google returns a map, including hotel locations and prices. Google Hotel Ads buyers can appear in the immediate results, as you see below.
But many guests will likely use the sorting tools to find the best hotel for their needs.
If you appear in the results, as a match for a guest’s needs, you want to make sure that they book directly with you, and not an OTA. For your listing to come up first, you need to be a Google Hotel Ads customer.
Hoteliers that want to use Google Hotel Ads need a technology provider, like Sabre or FastBooking, to provide Google with 3 data feeds: Hotel Listing Feed, Price & Availability Feed, and Point of Sale Feed. This technical requirement may be the reason why we see adoption for bigger brands and groups but less adoption for independent hotels and small groups.
Competing with OTAs isn’t easy. They have huge digital budgets and specialize in digital marketing. They only have to worry about getting the booking versus hotels that have to worry about getting the booking and providing guests with an exceptional experience. But you can’t win unless you compete and Google Hotel Ads is a great place to start.
To learn more, visit Google’s online information center.