OTAs - short for Online Travel Agents - are one of the most influential forces in the accommodation industry. For hotels, B&Bs, holiday parks, glamping sites, and short-stay accommodation providers globally, OTAs can be both a powerful source of bookings and a significant cost.
This guide explains what OTAs are, how they work, their advantages and disadvantages, and how to use them strategically as part of your direct booking strategy.
What Are Online Travel Agents?
OTAs are third-party websites that allow travellers to search for, compare, and book accommodation online. Instead of booking directly through an accommodation provider, bookings are made through the OTA's website. The OTA then passes the reservation to the accommodation provider.
Popular Online Travel Agents
How Online Travel Agents work
OTAs connect accommodation providers with travellers globally, giving accommodation providers access to guests they might not have otherwise reached.
Here's how the process usually works:
1. The accommodation provider updates their availability, rates, and booking rules to the OTA
2. A guest searches and books on the OTA's website
3. The OTA confirms the booking and sends it to the accommodation provider
4. The OTA charges the accommodation provider their commission fee for the booking
This two-way connection reduces manual work and helps prevent double bookings when systems are set up and managed correctly. Learn more about channel managers here.
In return for providing visibility, marketing, and booking technology, OTAs charge a commission on each booking they generate, often calculated as a percentage of the total booking value. The amount of commission each OTA charges is different and can vary with promotions and deals you agree to with the OTA. Usually, commission costs fall between 15-25%.
Why do guests book through OTAs?
For many reasons, OTAs are a popular guest choice. Even those who book directly with the accommodation provider often use OTA websites as a starting point when deciding where to book. From the guest's perspective, OTAs offer a familiar and trusted booking environment often supported by loyalty schemes, encouraging them to book through their site again for future stays. Unlike individual property loyalty schemes, guests can usually benefit when they book and complete stays anywhere. They offer a familiar, trusted environment, clear pricing comparisons, reviews, and the convenience of managing multiple bookings in one place.
OTAs allow guests to:
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Compare destinations within their budget using filters such as price and ratings
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Quickly spot the best deals available for their travel dates
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View and compare multiple accommodation options in one place
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Read reviews from other travellers
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Use filters to narrow results by preferences like location, amenities, or property type
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See real-time availability before committing to a booking
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Get a clear overview of all their booking options at once
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Understand typical costs, availability, and convenience across different destinations
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The benefits of using OTAs
Used strategically, OTAs can play a valuable role in an accommodation business.
1. Increased visibility
OTAs invest heavily in marketing, search engine optimisation (SEO) and brand recognition. This allows small and independent properties to appear alongside bigger hotel brands.
2. Access to new guests
OTAs often introduce guests to your property for the first time. These guests may never have found your website on their own.
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💡 TIP: Create a Google Business Listing and connect it to your channel manager to make it easier for guests to find your website and see your direct rates alongside your OTA rates.
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3. Support during low season
During quieter periods, OTAs can help maintain occupancy when direct demand drops.
4. Reduced marketing effort
OTAs handle advertising, search visibility, and much of the booking journey, saving time and effort.
The downsides of OTAs
While OTAs bring bookings, they also introduce limitations and costs.
1. Commission fees
OTA commission reduced the net value of each booking. Over time, this can have a significant impact on profitability.
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💡 TIP: Adjust your rates for OTA websites to cover their fees.
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2. Reduced control
OTAs often impose rules around pricing, availability, cancellations, and promotions, limiting flexibility.
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💡 TIP: Some OTAs will automatically opt you in to promotions or discounts. Check your accounts regularly to avoid increased costs.
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3. Limited guest data
Guest relationships often belong to the OTA, not the accommodation provider. This makes it harder to build loyalty.
4. Increased competition
Your property appears alongside competitors - often with price comparison front and centre.
5. Dependency risk
Over-reliance on OTAs can leave a business vulnerable to commission increases or policy changes.
OTAs vs Direct Bookings
One of the most important decisions accommodation providers face is how to balance OTAs with direct bookings.
OTA bookings
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Higher volume potential
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Higher acquisition cost
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Less control over property-guest relationship
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Direct Bookings
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No commission
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Greater control over pricing and policies
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Direct communication with guests
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Higher profit per booking
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For most businesses, the goal is not to eliminate OTAs, but to use them strategically to fill the gaps after offering accommodation to direct bookers first. The most successful accommodation businesses treat OTAs as a tool rather than a dependency. Monitoring commission costs, avoiding over-discounting, and using reliable booking technology all help maintain control.
When Do OTAs Make the Most Sense?
OTAs are particularly useful when:
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Launching a new property
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Entering a new market
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Filling last-minute availability
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Supporting low or shoulder seasons
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Attracting international travellers
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They are less effective when used as the only source of bookings.
The Role of OTAs in a Sustainable Booking Strategy
A sustainable booking strategy typically includes:
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A professional website with a strong booking engine
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OTAs used for visibility and demand generation
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Clear pricing and availability control
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Active efforts to grow direct bookings
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Ongoing review of commission costs
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This balanced approach helps accommodation providers protect margins while maintaining healthy occupancy.
Final Thoughts on Online Travel Agents
OTAs and Online Travel Agents remain an important part of the accommodation landscape globally. They provide reach, marketing power, and booking convenience - but they also come at a cost.
Understanding how OTAs work, what they're good at, and where their limitations lie allows accommodation providers to make smarter decisions. When used strategically and supported by strong direct booking tools, OTAs can help grow a business without taking control of it.
The key is balance: use OTAs to attract guests, and direct bookings to build a profitable, resilient future.