Are OTAs Hindering Growth? A Fresh Look from Arival San Diego
Peter Muttitt
I help attractions, tours and experiences grow their businesses. ?? Managing Director / Senior Leader / Sales / Growth / Business Development / Advisor / Consultant / Dad
Let me start by saying, I love OTAs (Online Travel Agencies). They’ve been integral to the growth of every business I’ve worked with at PM Consulting and representation and during my time at Go City. However, an interesting conversation came up during an advanced strategies session at Arival San Diego last week that got me thinking.
It was highlighted that a persistent issue that many of us in the industry have faced: as OTAs expand their distribution partnerships, how do we know where our sales are coming from and how can we gain access to these partners? While these partnerships offer new growth opportunities and access to diverse markets, such as travel agents, they also create a significant challenge for operators trying to understand their sales channels.
The Challenge: Tracking Growth
Picture this: you experience a sudden surge in sales, and you assume it’s because of some strategic updates you’ve made on an OTA platform. But what if that spike is actually from a new distribution partner using the OTA as an intermediary? You’re left guessing whether the volume is truly incremental or just cannibalizing sales from other channels. Without transparency, it’s impossible to pinpoint the source of this growth, which makes it difficult to scale your business effectively.
The frustrating part is that OTAs have been notoriously tight-lipped about sharing detailed data on where those sales are coming from. Why? Their typical response: “We don’t want you going directly to these distribution partners; they might cut a direct deal with you.” But let’s be real — that concern is a non-starter.
OTAs' Real Value: Simplified Access
The truth is, distribution partners work with OTAs because it’s easier. They get access to a wide range of products through a single connection, rather than managing countless individual contracts with attractions and activities. The OTA provides a one-stop shop. So, the notion that partners would ditch OTAs for direct deals with individual operators is largely unfounded. It’s simply too much of a logistical headache.
So, What’s the Solution?
How can we, as an industry, push OTAs to be more transparent and collaborative? We all want to see these channels grow, but we need the right tools and access to make that happen. Here are some practical solutions:
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Learning from Existing Programs
To be fair, there are existing opportunities out there. Both Viator and Expedia have their own Travel Agent Partner (TAP) programs. I’ve participated in a few of these myself, where agents and partners had the chance to train directly with product operators. However, these programs are sporadic and not as accessible or regular as they could be.
Viator, for example, shared at their Ignite event that they have over 200,000 travel agents enrolled in their TAP program. But with that many agents, how do you stand out when your product is just one of hundreds of thousands? And more importantly, how do you make sure your product gets the attention it deserves when it’s sometimes the key draw for visitors to a destination?
A Call for Change
At the end of the day, I’m all for OTAs expanding their partnerships and making it easier for us to sell across multiple destinations. But this growth shouldn’t come at the cost of operators having access to crucial information and training opportunities.
As an industry, we need to push for more transparency and collaboration. With clearer data and better training resources, we can maximize the potential of OTAs and create a win-win situation for both operators and distribution partners.
Let’s work together to build a more open and collaborative future with OTAs — one where everyone has the tools they need to thrive.
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Head of Commercial at Sports Where I Am | Sport & Travel - it’s better than Lego! ??
4 个月Love unpacking these all too normalised components of distribution Peter, nice catch! For me, contrary to any fears they may have of suppliers 'going it alone', it represents an opportunity for OTAs to increase engagement and investment among and from their supplier base through the provision of these insights - as not only do these reflect how the OTA is 'working for me', but also prompts me to ask myself the question - how can I work more for them? For example - if Bob's Experiences (an example OTA I prepared earlier), said "did you know x% of your production came from this retail channel based in x" - it not only says to me, wow, Bob's really able to broaden our reach in a scalable way - but it also might prompt me to tailor my product or my merchandising to lean in to some of these reseller partnerships (their source market, booking behaviours) - making more money for Bob, me and helping him strengthen his relationship with his strategic partners. I've seen first hand from the OTA side how data + insights can empower the relationship between supplier and channel, so give us the tools to unlock these opportunities further together I say!
Tourism Professional with a Special Expertise in Experiences
4 个月An ongoing and continuously interesting topic. Thanks for sharing! Having worked with both a distributor and an OTA, I can unfortunately confirm that there are distributors out there that proactively apply a strategy where they "use" OTAs to test the waters of a new destination by onboarding a portfolio of products to then evaluate the sales potential and target top sellers for direct contracts for the increased commission.. This is unfortunately a very real and current dilemma which OTAs face. I don't have to think more than 2 months back, to recall last time (yes, this has happened more than once??) where a distributor accidentally cc'ed me on their internal correspondence about aspirations to cut me out and get a direct deal with the supplier?? With all that said, I can also confirm that many of us would greatly prefer full transparency, and I'm pleased to say that in some cases we're getting there. Some key suppliers are very open with me about not having the time and resources to manage the cooperation with certain distributors requiring too much monitoring of prices not being undercut, availability correctly displayed etc. and they're pleased to have me handle that. In such cases, I dare be more transparent??
Head of Global Experiences
4 个月Enjoyed this article, Peter. Thanks for putting it together. I've always been part of OTAs so some may say I'm biased but I've been part of many a conversation where suppliers decide that resellers are cannabalising their sales. My argument is always the same - You are guaranteed your commission on our sale. We spend the ￡s on marketing, sourcing the partners, endless management of the products (content/rates etc) and you benefit from that. There will always be the argument that the supplier can do it themselves but like you say, this is a 'one stop shop' opening up to many more channels that you may not access yourself. I agree that more data can be shared. That is down to the relationship between supplier and OTA. Without a relationship, you don't get that. Work together, not against each other.
Chief Executive - Visit Greenwich
4 个月Great article. I fully agree. At a destination level it is near on impossible to track the source of new business via online third parties
Sales leader, board member, dad
4 个月I like that we're shining a light onto a key part of an OTAs sales that rarely gets mentioned. From my experience the OTA partnerships tend to be a "one and done" scenario. Get the contract signed, create the whitelabel, enjoy the passive income. Which is often the only way to operate, as the sheer volume of partnerships equals 100s if not 1000s. so being more hands on, requires way more staff than they have and then factor in that the amount of influence an OTA has on pushing the 3rd party to grow is small. But as AI & Reporting gets smarter, perhaps so will the OTAs. I'd love to have an OTA come to me and say "we've partnered with X and the data is showing potential (high conversion %) with your product, what can you do to help?". As you say it could be training the partner to be better able to sell, it could be improving our language options, or providing bespoke marketing materials or we can run tactical campaigns... but it first starts with having that open conversation