Direct booking vs OTA: Finding the right balance for your holiday park

As a holiday park, you want to maximise occupancy all-year round. So how do you bring those all-important guests to your park? You may employ a purely direct booking strategy or you may rely on online travel agencies (OTAs) – but is there a way of using each channel effectively so that guests not only find you easily, but have a smooth booking experience (while also protecting your margins)?

In this article, we want to look a bit closer at the advantages and disadvantages of both direct channels and OTA bookings, and how holiday parks can hit that sweet spot.

What is an OTA?

Online travel agencies, or OTAs, are third party platforms that allow people to research their travel or accommodation and compare prices. They offer people a quick and easy way to make bookings thanks to their large databases of options.

How they work: OTAs work by acting as a digital middleman, they don't actually own any properties or holiday parks, but allow users to input what they are looking for in terms of their holiday park break; date, how many nights, location, facilities etc, then they output the relevant results.

The customer books and pays via the OTA, and the OTA passes the booking through to the park.

OTAs generally earn their money through commission fees, taking a percentage of each completed booking.

The benefits of OTAs for holiday parks

There are a number of benefits to having your park included on a third party platform as it generally means you'll enjoy greater exposure.

• OTAs can be great at giving holiday parks access to new audiences.

• Their wide reach can not only boost awareness but help to fill quieter periods, boost the shoulder seasons and fill last minute availability.

• They can be useful in reaching out-of-area customers.

• Bigger sites already have customers who trust them, who appreciate the smooth search and booking journey which is no bad thing for your guests to experience.

• OTAs can be thought of as an extension to your own marketing. You're essentially paying a commission for customer acquisition.

Why you shouldn't rely too heavily on OTAs

While there are plenty of advantages to using OTAs, there are also disadvantages which are worth bearing in mind when deciding your booking strategy.

• Protect your margin – OTA commissions typically range from 15% to 25% per booking, bringing your margin down and causing commercial instability.

• No ownership of customer relationship – with no input into the customer booking experience, you have little control over managing customer data, making it hard to communicate directly and build loyalty to encourage repeat visits.

• Reduces brand visibility – customers may well only remember the booking site rather than your brand.

• Can't control future changes to OTA operation – being too dependent could mean you're left exposed should sites' commission fees change or the algorithm is updated.

Why direct bookings matter

Direct bookings shouldn't be ignored, and while it can take time and investment in marketing activity to get your name out there, the longer term results are worth it.

Higher profit margins

With no commission fees to pay, the direct revenue of the booking comes to you. However, it's worth noting that direct bookings aren't 'free'. There's still a cost attached to your PPC, SEO, social media, content writing, email marketing and all of the numerous ways you communicate with and target customers, not to mention staff and agency costs.

Customer ownership

Having contact with the customer from the very first enquiry allows you to capture guest data and nurture a direct relationship with them. More direct bookings means you can build CRM and loyalty strategies to increase repeat bookings.

Upselling opportunities

Having direct communication with your guests means you can control the messaging around the full guest journey, letting them know further information about what additional facilities or dining outlets you have that they may wish to make use of during their stay.

Direct booking vs OTA bookings – what to measure

It's important to review the overall performance of both your direct channels and your OTA bookings to see which booking channel is performing the best for you and whether you have the right balance. Use the following checklist to gain valuable insight into what's working.

• Bookings

• Revenue

• Net revenue

• Cost of acquisition

• Length of stay

• Cancellation rate

• Repeat booking rate

• Customer lifetime value

• Upsell revenue

How to find the right balance

It's clear that both OTAs and direct bookings are important, so play to their strengths. Rather than trying to get them to both do the same thing, think of them as each having a different role.

For example:

The OTA's should be used to:

• Reach new audiences

• Fill gaps in occupancy

• Generate awareness

• Support low seasons

• Test new markets

Direct bookings should be used to:

• Build loyalty programmes

• Convert returning customers

• Drive repeat stays

• Maximise customer lifetime value

• Upsell and offer exclusive packages

• Develop your database

The right mix will depend on the park, and factors such as location, target market, brand strength, seasonality, competition and website strength.

Looking to increase direct bookings?

Perhaps you're already using OTAs but want to strengthen your guest relationship by building up your direct booking experience. Here are our key tips on increasing your direct booking share:

Website performance

Making sure your own website is working as hard as possible is key, because potential guests and owners won't find you if it's not! Invest in a professionally-designed website with strong photography and videography, a smooth user experience, clear pricing to attract potential bookers.

A dedicated mobile-friendly booking page with secure payment and straightforward process is crucial for a smooth guest experience.

Don't forget an effective SEO strategy. Include content written using keywords around related keywords to bring users to the site.

Use PPC

PPC is a great way to strategically target those who are searching for holiday parks such as yours. Focus on high-intent keywords as well as returning customers.

Build an email database

Nurture direct bookers by using guest data to keep in touch once their stay is over to encourage guests to book again.

Provide a reason to book direct

Consider providing direct-booking incentives such as loyalty programmes, exclusive discounts, early information about seasonal packages, special offers during low demand periods, priority access and complimentary extras.

The right booking strategy isn't about choosing between OTAs and direct. It's about understanding what each channel contributes to your business – and making sure you're getting the best possible return from both.

Want some independent insight into your booking strategy? Our team is available for a no-obligation chat as soon as you are.

FAQs

Are direct bookings better than OTA bookings for holiday parks?

Both direct channels and third party platforms have a place when it comes to holiday park bookings. The key is understanding the slightly different benefits of each and knowing how to maximise them.

What is the best booking platform?

There isn't a “best” OTA for every holiday park. The right mix depends on what you're selling, who you're trying to reach, your seasonality, your occupancy levels and the strength of your direct booking channel.

How do I make sure OTAs complement our booking strategy?

A good starting point is to use OTAs to reach new audiences and fill periods of lower demand, while concentrating on direct booking for building a loyal database and to communicate with anyone looking to buy on your site (should that be an option).