In short, online travel agencies are commoditizing the hospitality industry.

On the surface, they offer a lucrative channel to heighten exposure and increase bookings, but the big picture is grim for hotels.

OTAs are stripping brand identification away from independent and chain properties, eroding your customer loyalty in the process, and all for a lofty commission rate between 15 per cent and 30 per cent.

For example, suppose a younger, tech savvy consumer is seeking a tropical resort destination for a romantic retreat. It’s rapidly becoming the case that his or her first stop will be to an OTA.  Once there, the website’s layout makes it far too easy for a streamlined purchase. In the end, such FIT consumers will seek out the OTA for future vacations, and not necessarily your property.

Given that all hotels are displayed in a rather ubiquitous manner for each OTA website, the consumer perception is most visible based off of price and rating differences, excluding many of the finer branding touches that hotels have taken years, if not decades, to perfect.

With more and more people from the Internet generation reaching adult consumer status, the disparity between hotel and OTA loyalty will only grow as time goes by.

(Article by Larry Mogelonsky, published on hoteliermagazine.com on March 9, 2012)