The Pros and Cons of Using an Online Travel Agency

Online travel agency, also known as OTAs, act as a search engine that connects travelers with various travel products and services including hotels, flights, vacation rentals, car rental and cruises. These websites typically offer package deals with both accommodations and flight tickets and are the most significant source of online bookings in the travel industry.

As a hotel, listing on an OTA can play an important role in your marketing and distribution strategy. Many potential guests will see you on an OTA and then go on to make a direct booking at your website. This is sometimes called the ‘billboard effect’.

OTAs can be a valuable distribution channel because they reach large numbers of users and have built-in booking systems that make it easy for travelers to book. However, you need to weigh up the pros and cons of using an OTA with your own website as your primary distribution channel.

The benefits of using an OTA can include a streamlined booking process that eliminates the need to call or visit a physical travel agent, increased visibility and the ability to create and promote specific packages. OTAs can help you increase the number of bookings from new and repeat guests and provide access to market data, competitor insights and guest preferences that would be difficult or cost prohibitive for you to obtain on your own.

One of the key challenges for online travel agencies is sales tax compliance. Unless an OTA is designated as a marketplace facilitator for sales tax purposes and only collects payments on behalf of lodging providers, it will be responsible for collecting and remitting taxes. online travel agency

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