Online Travel Agencies (OTAs) play a crucial role in driving bookings, but high commission rates can significantly impact a hotel’s revenue. Negotiating better rates with OTAs is essential to maximize profitability while maintaining visibility on these platforms.

Understand Your Hotel’s Value

Before negotiating, analyze your hotel’s performance on OTAs. Highlight key metrics such as:

. Occupancy rate

. Average daily rate (ADR)

. Guest reviews and ratings

. Direct booking performance

Hotels with strong performance data have more leverage when negotiating lower commissions.

Build Strong Relationships with OTA Representatives

Regular communication with your OTA account manager is key. Stay proactive by:

. Discussing promotional opportunities that benefit both parties

. Requesting insights on how to improve your visibility without increasing costs

. Being open to exclusive deals that can enhance your booking volume

Compare Commission Structures

Not all OTAs charge the same commission. Compare different platforms and use this data to negotiate better rates. Highlight your hotel’s direct booking potential to justify lower OTA costs.

Leverage Direct Bookings

A strong direct booking strategy gives you an advantage when negotiating. Consider:

. Offering exclusive deals on your hotel’s website

. Implementing a loyalty program for returning guests

. Enhancing user experience on your direct booking platform

If OTAs see that your hotel can generate bookings without relying solely on them, they may offer better commission terms.

Negotiate Based on Performance

If your hotel consistently brings high revenue to an OTA, request lower commissions in return. Some negotiation strategies include:

. Lowering rates in exchange for maintaining exclusivity on certain promotions

. Reducing commissions for repeat guests who initially booked through the OTA

. Setting performance-based commission tiers

Utilize Seasonal and Regional Demand

During peak seasons or in high-demand locations, hotels have more negotiation power. If your hotel experiences high occupancy at certain times, use that to push for better commission rates.

Explore Alternative Distribution Channels

Diversify your distribution by listing on multiple OTAs, metasearch engines, and direct booking channels. A competitive approach can pressure OTAs to offer more favorable commission rates to keep your hotel on their platform.

Monitor and Re-Evaluate Agreements Regularly

OTA agreements should not be static. Regularly review your commission structures, booking performance, and alternative options to ensure you are always getting the best deal.