How effective channel management can impact overall revenue

When thinking about Revenue Management, people often focus only on pricing, which needs to be flexible to maximize revenue. However, pricing is not the only factor that influences your hotel’s income.

Today, we’ll focus on distribution channels. A good hotelier who cares about the success of their business cannot overlook them and must understand how to get the most out of room distribution. Yet, even today, only a small percentage of professionals use them correctly, limiting their revenue potential. Let’s take it step by step.

Hotels have access to many different distribution channels, so it’s essential to understand how to use them effectively to maximize results and what advantages each one offers.

The hotel’s website is the primary distribution channel—or at least, it should be. It’s where potential guests go to learn about your property and possibly book a room.

Among all channels, it has the lowest cost. A website also helps you be found on search engines and reach a wider audience.

In the age of social media, some believe that a website is no longer necessary, but that’s not true. Your hotel website communicates your brand values and increases visibility. It is also the only online distribution channel where you can sell without paying commissions to third parties.

OTAs (Online Travel Agencies) are another key distribution channel. The most well-known include Booking.com, Expedia, Hotels.com, and others.

They offer several advantages, starting with the ability to reach a very broad audience and increase bookings. In particular, OTAs are widely used by travelers browsing via smartphone.

However, unlike your website, they come with relatively high costs for hoteliers. That said, with the right incentives, guests who book through platforms like Booking.com may later become loyal customers and book directly with your hotel.

Global Distribution Systems (GDS) are networks used by travel agents to book hotels, flights, and car rentals for their clients.

To be listed, hoteliers must pay an initial commission, but the benefit is access to new customers from all over the world.

Metasearch platforms are price comparison tools that show users the best available offers.

More and more travelers use metasearch engines because they allow them to compare hotel room prices from multiple OTAs and booking platforms in one place. For hotels, the main advantage is increased visibility.

First, you need to understand your market. Not all markets behave the same way. For example, the U.S. market tends to book mainly through official hotel websites, while the Chinese market—and many others—prefer OTAs.

Guest age also influences booking behavior. Younger travelers tend to book through OTAs, while older ones are more likely to use hotel websites.

As you can see, personalization is key here as well. Every traveler is unique, just like the journey they are planning. A holistic approach is essential to attract more customers and increase profits.

It’s important to use a mix of channels, such as your website, OTAs, and metasearch platforms. The key word is diversification, to avoid relying on a single channel.

You probably already know how important technology is in the hotel industry. Distribution across multiple channels can also be optimized through tools like a channel manager.

This software connects your property to multiple booking platforms and search engines, increasing your visibility.

The goal is to be present everywhere online so potential guests can’t miss you. When choosing a channel manager, make sure it integrates with your booking engine and is mobile-friendly.

Choosing not to use technology to manage distribution makes your work slower and more complex, and puts you at a disadvantage compared to competitors. For example, without a channel manager, handling overbookings becomes more difficult. With one, everything is automated and does not require manual processing.

Channels are updated simultaneously whenever a new booking is made. Additionally, this tool allows you to fully control your rates and create promotions, packages, and last-minute offers.

The ideal mix of distribution channels varies for each hotel—there is no one-size-fits-all solution. Instead, distribution strategies should be tailored to your audience and business goals.

Some hoteliers believe that removing OTAs from their distribution will increase profits by eliminating commissions, but that’s not necessarily true. A better approach might be to limit OTA bookings while encouraging direct ones.

Before making any decisions, it’s advisable to create a report on your channel performance. With this data, you can make more informed choices.

If you want to improve your distribution strategy and increase your revenue, get in touch with me. Together, we’ll develop the best strategy for your property.