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Applying e-commerce principles to hotel websites

Want more direct bookings? Start thinking of your hotel website as an e-commerce site, not a brochure.

One of the most common things we hear from hotels is their frustration in the commission fees from online travel agencies (OTAs) and their dependency on them for bookings. But the incredible recent growth of the OTAs hasn’t happened by chance.

One of the prime reasons that they continue to gain a larger share of bookings from hotels is their deep understanding of e-commerce and digital marketing. OTAs such as Expedia invest billions to understand what makes consumers book travel online, and their research has made them experts at conversion optimization and user experience.

In contrast, many hotels haven’t really adapted to the changing nature of how people research and book travel online. For so long, the hotel website has been treated like a fancy digital brochure, rather than an e-commerce site. Even with modern web design at our disposal, it’s important to remember that glossy photos and captivating copy aren’t the only aspects to convince customers to book.

If hotels want to succeed in a digital economy, hotel managers and marketers will need to embrace the key principles of e-commerce and apply them to their hotel websites. These principles include user experience, conversion triggers, and the travelers’ booking journey.

E-commerce principle #1: Mastering user experience

One of the first major principles of e-commerce for hotel websites is perfecting the user experience. This isn’t just about having a pretty website—it’s about how the user utilizes and interacts with your website.

Simple, intuitive design across all devices

Hotel websites that convert well make life easy for travelers by making their design simple and intuitive. This means having a clear navigation, easy-to-find information, and a strong call to action.

Just like wandering into a cluttered shop without any coherent layout or order, landing on a busy website full of information feels stressful and frustrating. When that happens, people quickly lose patience and leave.

This is important given the amount of travel research and bookings that now take place across various devices. Mobile bookings have increased tremendously in the last few years, making it crucial to have a mobile-friendly website and booking engine.


Constant A/B testing

Nothing stays still for long in the world of e-commerce. Websites are constantly updated and subtly tweaked to ensure consumers remain highly engaged throughout the shopping experience. This continual adaption is achieved by frequent A/B testing—a process that involves comparing different versions of the same page to measure which one converts best.

In the case of Expedia, they conduct 1,500 A/B tests every year to ensure their online experience matches the changing needs and expectations of their customers. This continual fine-tuning ensures potential bookings don’t slip through the net, accounting for the fact that customer expectations and shopping trends are in constant flux.

Personalizing the shopping experience

Example of personalized messages in Booking.com

The power of personalization also plays a hugely important role in improving user experience. In a study conducted by Infosys, 86% of consumers stated that personalization impacts the purchases they end up making.

As OTAs have collected mass amounts of booking data over the years, they’ve been able to apply that knowledge to help personalize the shopping experience for travelers. Using embedded cookies and marketing automation systems, they are able to know what you may have searched before on the site, and use that information to subtly convince you to book later on.

For example, say you’ve searched for hotels in Key West, Florida and you’ve happened to land on a Booking.com page for a hotel you’re interested in. Booking.com is able to track this information, and the next time you’re on the site, it will ask you again if you’re still planning a trip to Key West. It will also prompt you to consider the nearby Miami Beach as well.

These types of technologies are now becoming available to hotels, so hotel websites can now begin to also explore the advantages of e-commerce personalization.

E-commerce principle #2: Employing conversion triggers

One of the biggest things that hotel e-commerce managers can learn from OTAs is their mastery of conversion triggers, which are powerful tools used at pivotal points in the booking process that convince travelers to hit the “Book” button. Hotels should learn from these conversion triggers so that they can employ them on their own websites to increase direct bookings.

A sense of urgency

Ever notice how many OTA sites make you feel like you’re about to lose out on a very good deal? “Only 4 rooms left!” “32 people are currently looking at this hotel.” “Last booking for this hotel was made 1 hour ago.”

Subtle (or not-so-subtle) annotations like this all crank up the sense of urgency to book quickly. Beyond creating a sense of scarcity, letting customers know that a hotel is popular and in high demand also acts as a form of social proof. Together, increasing the desirability of a product and making it appear limited in supply is a powerful conversion tactic that helps drive more bookings.

User reviews and social proof

Consumer confidence and behavior is also heavily influenced by social persuasion. According to Econsultancy, 88% of customers look at reviews before they make a purchase. The e-commerce industry has understood the vast influence of user reviews for a long time and integrates them throughout the shopping experience.

OTAs place ratings and reviews throughout the online journey to incrementally advance customers towards booking. From the homepage through to the booking page, reviews are clearly visible and strategically used to boost conversion rates at every stage.

Booking engine technology now enables hotels to take advantage of these types of conversion triggers, including social proof and reviews. For example, Stratosphere Hotel uses these triggers on its own site:


Best rate guarantees

At the end of the day, consumers just want the best price. That’s why nearly all OTAs and major hotel brands encourage bookings using best rate guarantees. In most cases, this involves offering to match, beat or refund the difference of a lower price found elsewhere after the booking has been made.

With the growing popularity of metasearch, OTAs have been going one step further with best rate guarantees through total price transparency, which helps to instill trust and confidence in consumers. You can see this, for example, in the way Expedia asks you to “See how our prices compare” to other sites.


Hotels can now tap into this very technology for their own websites. Price checking and rate matching tools have been cropping up on a number of hotel websites, helping to automate this best rate guarantee process.


E-commerce principle #3: Understanding the travelers’ booking journey

Google’s famous “Travelers’ Road to Decision” mapped out how consumers research and book travel online. On average, users visit dozens of websites across many different devices as they are researching travel. Expedia’s own research says that travelers visit an average of 38 websites before booking.

Understanding the travelers’ booking journey is key in driving your hotel website’s digital marketing strategy. Even the most well-designed and well-optimized hotel website means nothing if travelers can’t find it.

SEO’s role in travel research

Despite what Priceline’s CEO may have implied about SEO being dead, it certainly isn’t. Google may be trying to ramp up its paid search business, but it certainly won’t be giving up organic search anytime soon. With that said, SEO has evolved greatly, and hotels need to understand the role it now plays in a travelers’ booking journey in order to use it successfully.

As travelers research dozens of different hotels, it’s important that your hotel is properly indexed so that it will show up in key areas such as Google’s hotel search. This means following best practices for local SEO (different than regular SEO) and making sure that you’ve got plenty of reviews for your hotel.


Ad retargeting to stay top-of-mind

A travelers’ booking journey, especially for leisure trips, may take weeks or even months of research online. During that time, hotels can use ad retargeting, a method of advertising where consumers who have visited a hotel website will see ads for the hotel as they casually browse other sites. This can be an effective tool for keeping your hotel top-of-mind for consumers while they are in the process of making their final decision.

Closing the deal with SEM

For most e-commerce businesses, search engine marketing is one of the most important strategies to invest in, particularly as recent design changes in Google have made it even more important to land in the top four spots on a search engine results page.

By understanding the travelers’ buying journey, hotel marketers can get a better sense of how ready the customer is to buy through the keywords they use. For example, searching for “hotels in key west” is a very general search; consumers are likely to be in the early stages of travel booking at that moment. As searches become more specific, such as when the consumer searches for a hotel by name, that indicates the traveler has done enough research and is getting closer to buying.

It’s time for hotels to become e-commerce experts

Direct bookings are the most profitable revenue source for hotels, so having a healthy direct distribution channel through your website is an important part of any revenue management strategy.

If hotels want their websites to compete on a level playing field with the OTAs, they will need to embrace the core principles of e-commerce. Yes, it’s a fast-changing industry that can often be hard to keep up with, but by finding the right technology partner that can help them understand the latest techniques and tools available, hotels can strengthen their hotel website, increase direct bookings, and lessen their dependency on OTAs.

Gautam Lulla

Gautam Lulla

Gautam is CEO of Pegasus and an outspoken expert in hotel technology and distribution. When he's not busy disrupting the status quo, you can find him ripping powder on the slopes. Contact him at gautam@pegs.com.

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