OTAs are great for volume and visibility, but they come with a cost: commissions, higher cancellations, and weaker loyalty. The goal isn't to "stop" OTAs—it's to build a healthier mix. And to use dynamic pricing so your best nights don't get filled first through your most expensive channel.
Glossary: key terms for channel mix
- Direct Booking and Metasearch
- Rate Parity and Rate Fences
- NRevPAR: why net revenue matters
1) Start with the true cost of a booking (not just commission)
Commission is only the headline. For better decisions, estimate:
- commission and payment fees;
- cancellation / no-show differences;
- operational effort (changes, support, invoicing);
- impact on upsell and ancillary revenue.
This is the practical meaning of NRevPAR: two bookings with the same ADR don't have the same value.
2) Protect your peak dates (the fastest way to reduce OTA dependence)
If you do one thing, do this: on strong dates, hold inventory for direct and manage OTA availability more tightly:
- Use pace and pickup to spot strong dates early (how to read booking pace).
- Raise rates gradually (small, consistent dynamic pricing steps), rather than waiting for the last moment.
- Restrict OTA availability on peaks instead of "filling" with commission-heavy demand.
This often reduces OTA share without aggressive discounts, simply by giving direct demand time to materialize.
3) Use value-add and rate fences (instead of cutting BAR)
If you need to stimulate direct demand, the cleanest approach is to add value without breaking your pricing logic:
- packages (parking, drinks, late check-out);
- different conditions (more flexible cancellation);
- member rates with clear rules (rate fences).
This helps you maintain rate parity and avoids training the market to wait for discounts.
4) Fix conversion basics: your direct channel must be easy
Restricting OTA inventory doesn't help if direct doesn't convert. Minimum checklist:
- clear policies and transparent fees;
- mobile speed and a simple booking flow;
- up-to-date photos and offers;
- metasearch visibility (Google Hotel Ads, Trivago) with the right setup.
Even small conversion gains matter when your pricing is aligned through dynamic pricing.
5) Use data to learn faster (and stop relying on gut feel)
The key is seeing results by segment and channel. Sigma Revenue helps with Analytics, KPI Dashboard and Rate Recommendations (with competitor context).
Want a concrete channel-mix plan for your hotel? Contact us.