Does Brand Loyalty Even Matter Anymore?
By Gary Isenberg President, LWHA Asset & Property Management Services | April 01, 2018
As popular OTAs such as Expedia, Booking.com, Trivago, and TripAdvisor syphon away significant numbers of guest bookings each day, brand executives ruefully wonder if brand loyalty even matters anymore. The answer is, well, yes and no.
In one significant aspect of the guest journey - the reservation process - the OTAs have overpowered any remnant of lodging brand loyalty. Most consumers no longer shop for hotel stays by visiting individual hotel brand websites. Instead, they log onto Expedia or Booking.com and compare hotels in a single market by price and customer service scores. When it comes to making a reservation, unfortunately, brand loyalty doesn't matter much anymore.
But hotels are fighting back by promoting brand loyalty through frequent traveler and rewards programs. Through these efforts, hotels deliver guest experiences and amenities the OTAs, for all their advantages, cannot. It's in this arena where hotels possess the power to convert travelers into brand loyalists.
Reservations: A Battle Already Lost
Hard as this must be for brand executives to hear, the OTAs now control the reservation process. They've essentially eliminated the brands at the point when most consumers book a hotel room. Since the OTAs have already won this war, hoteliers should stop trying to fight them on this battleground.
It wasn't always that way. Just 25 years ago, brands monopolized the reservation system through centralized call centers, toll free numbers, and global distribution system (GDS) access. But that all changed in the '90s when the Internet and the OTAs exploded on the scene. In fact, in the mid-1990s, the only place a consumer could book a hotel room online was via the OTAs. The brands, regrettably, lagged behind in offering booking links on their websites.