Why Hotels should Maintain their Brand Independence
An independent hotel starts with a unique vision and concept. Unlike standardized chains, independent properties and collections have the opportunity to distinguish their brand in the market and deliver truly memorable experiences to guests at all stages of their journey.
But, as the world of online travel and hospitality rapidly evolves, with everything from algorithm and policy changes to shiny new tech solutions popping up at every corner, many independent hotels find it increasingly challenging to navigate this complex landscape and directly manage their brand and online business. In an attempt to simplify their marketing and sales strategy, many hotels inadvertently relinquish their brand independence to third-parties that promise to do the heavy lifting in this regard.
While this approach may seemingly streamline commercial operations in the short term, it can also compromise the brand identity and autonomy of independent hotels with truly unique experiences to offer. This article delves into these critical issues and how hotels that maintain their independence also retain a significant advantage to distinguish themselves from the competition, cultivate direct relationships with guests, and significantly grow their online business.
A History of Relinquishing Control – Will Hotels Ever Learn?
As internet usage became more widespread back in the mid 90s, OTAs were among the first to pioneer online distribution. As consumers increasingly shifted towards booking travel online, OTAs offered a simple and convenient way for hotels to capture this demand. With time however, many hotels became overly dependent, with 60% to 90% of their business generated from OTAs. This development not only held hotels hostage to these channels, but also came at the expense of their brand, online presence, and business in the process.
Meanwhile, OTAs continued to rapidly expand their online market share and consequently became the primary gateway through which travelers discovered and booked accommodations, exerting significant dominance over pricing, availability, and booking conditions. This development underscored the importance for hotels to establish their brand presence online and engage customers directly. By the 2010s, a seismic shift began to occur in the travel industry as digital platforms and online presence became paramount.
However, what significantly strengthened the bond between guests and hotels was when travel came to a standstill in 2020. During these disruptions, independent hotels not only resolved guests’ issues but also provided additional services. Thus, guests’ proclivity to engage with hotels directly remained robust even after OTAs resumed normal operations, resulting in higher direct channel performance compared to previous years.
But the evolution didn’t stop there. Tech giants like Google continue to redefine how travellers discover and choose their destinations, thus increasing dominance over the online travel marketplace where OTAs also compete. This dynamic presents additional concerns for hotels striving to maintain online visibility and attract customers. Moreover, the advent of AI technologies such as ChatGPT and Gemini may introduce further centralization in online distribution channels. While these platforms enhance visibility, they concurrently impose significant control over hotel brands, influencing pricing strategies, search results, and customer interactions
Although most independent hotels have the opportunity to distinguish their brand in the online marketplace and maximize increased direct engagement from guests, many still continue to readily hand over the management of their online business and inventory to intermediaries or third-party agencies, without considering the long-term implications on their business.
The Hidden Risks for Hotels that Surrender Control of their Brand
No hotel is an island, and to an extent, all must work with partners in order to manage their online business, whether it’s distributing inventory on the OTAs or Google etc, or investing in software packages such as PMS, CRS, RMS, or CMS. However, fully entrusting your hotel’s distribution and e-commerce to third parties can lead to significant risks. Hotels that take this (seemingly) easy path face potential disruptions if these third-party entities undergo policy changes, technical failures, or business closures.
Recent policy changes, such as Expedia’s shift in commission structure, Airbnb issuing full refunds for non-refundable bookings during the pandemic, changes to Booking’s prepaid rates, or Google’s recent SEO algorithm adjustments which seem to further prioritize visibility for large industry players, illustrate the vulnerabilities hotels face when overly-reliant on third parties.
These developments also underscore the need for hotels to maintain brand independence and control over their inventory and customer relationships. Ultimately, hotels should focus on protecting their brand to weather such changes and effectively convert bookings through direct channels, as many guests still visit these channels before finalizing their reservations.
The Success of Hotels that Maintain Brand Independence and Autonomy
Independent hotels are best positioned to offer unique, memorable, and personalized experiences that ultimately translate into direct guest relationships and significant business growth. By emphasizing their originality and personal touch online, independent hotels stand out in a crowded market. This contrasts with chain hotels that, while maintaining high service standards, often follow a more standardized approach.
In terms of online marketing and distribution, independent hotels also benefit from flexibility and creativity, free from the overarching policies and strategies. They can implement original marketing campaigns and distribution strategies that resonate with their unique brand and target audience. It goes without saying that a strong focus on providing a unique, high-quality experience in exclusive locations allows independent hotels to attract guests who prioritize individuality and exceptional service over cost.
Brand distinction and autonomy begin with a clear vision, and it is essential that everyone working at the hotel is united in achieving this objective. Investing in the right technology can empower hotels to simplify and streamline their online presence and business strategy, offering valuable insights and the agility to make informed decisions. This approach benefits hotels of all sizes, regardless of their staff numbers.
AlmaLusa Hotels is a prime example of an independent collection that has grown significantly due to brand distinction and online business autonomy. As Sofia Brandão, Managing Director at AlmaLusa Hotels, explains, To stand out online, independent hotels must clearly communicate their unique offerings to their target guests. Maintaining control over their online presence and brand perception is essential to ensure a consistent and aligned image. Without full control of their branding, their message becomes fragmented and inconsistent.
Sofia also emphasizes how technology, combined with a unique vision and story, enables brand independence, fosters direct guest relationships, and streamlines the delivery of personalized experiences, saying, Technology helps us efficiently give guests a unified experience of our brand across all channels. We blend the best technology with the human touch, maintaining personal hospitality while meeting online needs. This ensures a seamless experience true to our vision and brand.
Amaria Hotel also leverages technology to maintain brand independence and autonomous business growth. Owner Nuno Oliveira emphasizes, As a newly opened independent hotel, we use technology to control our online business, avoid reliance on external channels, and strengthen our core marketing channels to engage directly with guests.
This strategy has led to significant growth, with 60% of revenue generated directly. Nuno adds, This is undoubtedly the impact of delivering unique experiences and maintaining proximity with our guests.
To maintain full control over delivering these unique experiences, Amaria Hotel continues to operate independently from OTAs, influencers, and other intermediaries. This independence enables us to tell our own story directly to guests, and Guestcentric’s solutions empower us to communicate the unique qualities of our business and maintain proximity with our guests online,
Nuno observes.
Through a combination of clear vision, brand control, and strategic use of technology, both AlmaLusa Hotels and Amaria Hotel exemplify how independent hotel brands can seamlessly grow their business while maintaining their unique identity and independence.
The Path Forward for Independent Hotels to Remain Truly Independent
If you have a strong brand with a story to tell, then you should protect it and maintain its independence. As demonstrated above, hotels that prioritize their brand differentiation and business autonomy in order to target and engage directly with guests, are ultimately the ones that compete on a level playing field, grow profitability, and are more resilient amidst unforeseen industry changes.
Investing in the right technology can make it easier for independent hotels to seamlessly manage their brand image and customer relationships, thus securing long-term business success that is less vulnerable to third-party or wider industry changes. Hotels should start simple when considering technology to invest in, selecting solutions that support their goals for brand and business autonomy. These solutions should be open and easy to adapt and improve as market conditions change, allowing hotels to build and develop on top of their initial investment as the industry evolves.
About GuestCentric
GuestCentric is a leading provider of cloud-based digital marketing software and services that help extraordinary hoteliers promote their brand, drive direct bookings and connect with customers on all digital platforms. GuestCentric's all-in-one platform provides hotels with the only unified solution for managing their guests' online journey: award-winning, high impact websites; an integrated, easy-to-use booking engine; social media marketing and publishing tools; a GDS chain code and a channel manager to offer rooms on Amadeus, Booking.com, Expedia, Galileo, Google, Sabre, TripAdvisor and hundreds of other channels. GuestCentric is a proud provider of solutions that maximize direct bookings to hotel groups and independent hotels from collections such as Design Hotels, Great Hotels of the World, Leading Hotels of the World, Relais & Chateaux, Small Luxury Hotels and Small Danish Hotels. GuestCentric is featured on Skift Travel Tech 250, a list of the top 250 travel tech companies shaping the modern-day travel experience.
Melissa Rodrigues
Content Manager
+35 196 157 3854
GuestCentric Systems
