For many independent hotels and boutique hotels, the relationship with OTAs is easy to describe. Booking.com and Expedia generate a large share of the bookings, the commissions are painful, and management would like to see more reservations coming through the hotel’s own channels.
The usual conclusion is that the hotel has an OTA problem.
But that conclusion can be too simple. An OTA can be expensive. It can also be extremely useful. It can introduce a hotel to people who would never have found it otherwise, make the property visible in markets where its own marketing reach is limited and provide a booking experience that guests already understand.
The more important question is not how many bookings come through an OTA. It is why those bookings are coming through an OTA in the first place.
An OTA can be the symptom, not the cause
Imagine a boutique hotel where 65% of online bookings come through Booking.com. The owner looks at the numbers, sees the commissions being paid every month and decides that the hotel needs to reduce its dependence on the platform.
That sounds reasonable, but before changing the distribution strategy, there is another question worth asking: what would those guests have done if Booking.com had not been there?
Some may never have discovered the hotel. Others may have found it through Google, social media, reviews or recommendations and then used Booking.com simply because it was easier to book there. Some may even have visited the hotel’s website first, decided that they wanted to stay there and then gone back to Booking.com because the booking process felt more familiar or reassuring.
Those are very different situations.
In the first case, the OTA is generating demand that the hotel might struggle to generate on its own. In the second, the OTA may simply be intercepting demand that the hotel has already paid to create. Treating both bookings as the same kind of OTA dependency makes it much harder to understand where the real commercial problem sits.
The OTA may be doing a better job of selling your hotel
There is an uncomfortable possibility that many hotels don’t like to consider.
Sometimes Booking.com is simply better at selling the property than the hotel is.
The OTA may present the hotel clearly, make the room options easy to compare, provide reviews at exactly the moment the guest is looking for reassurance and make the booking process feel straightforward. The hotel website may have beautiful photography and a sophisticated design, but still leave the guest wondering which room they should choose, what is included, whether breakfast is available, how cancellation works or why they should book there instead of somewhere else.
The OTA has a very specific job. It needs to help someone make a booking.
Your website has a much broader job, because it also needs to communicate the identity of the hotel, establish value, create desire, answer questions, build trust and eventually make the booking feel like the obvious next step. When those elements are not working together, the OTA can become the easier place to complete a decision the hotel has already helped create.
That is not necessarily an OTA problem. It is a direct-channel problem.
Not every OTA booking is a lost direct booking
This distinction matters because hotels sometimes calculate the cost of OTA distribution as though every OTA reservation could have been a direct reservation.
That isn’t necessarily true.
If a traveller in another country has never heard of your hotel, discovers it while searching through an OTA and books there, the OTA may have created access to a guest you would not otherwise have reached. You may not like paying the commission, but removing the OTA would not automatically turn that reservation into a direct one.
The calculation changes when the guest already knows the hotel.
Perhaps they searched for your property by name. Perhaps they saw your Instagram account, read a review, clicked through to your website and then opened Booking.com to make the reservation. Perhaps they were referred by a previous guest and already knew exactly where they wanted to stay.
In those cases, the OTA may not have generated the demand at all. It may simply have provided the final transaction.
That is where OTA dependence becomes much more interesting to analyse.
Your direct channel may be losing bookings before the booking engine
Hotels often look at direct bookings as if the problem starts when the guest reaches the booking engine, but it may start much earlier.
A guest needs to understand why your hotel is worth considering before they ever reach the booking page. They need to recognise the property, understand what makes it different, trust what they are seeing and feel confident that the hotel is appropriate for the trip they are planning.
If the positioning is vague, the website does not communicate value clearly or the information is difficult to find, the hotel can lose the booking before the booking engine has any opportunity to convert it.
The same thing happens with enquiries.
A guest may find the hotel, become interested, send an enquiry and then receive a response that is slow, generic or poorly structured. The hotel has technically received a direct lead, but the commercial process has not necessarily converted it into a booking.
This is why looking only at the final booking channel can hide the actual leakage. The OTA may be where the booking eventually appears, but the opportunity may have been lost much earlier in the journey.
A beautiful website doesn’t automatically create direct demand
This is particularly common in boutique hotels because there is often a strong emphasis on visual presentation.
The website looks good. The photography is beautiful. The rooms are presented carefully. The destination looks appealing. The hotel has a clear visual identity.
And yet the direct booking numbers remain disappointing.
The problem is that a website can communicate the atmosphere of a hotel without communicating the reason to choose it. It can show the property without helping the guest understand its value. It can look premium without making the booking decision feel easier.
This is one of the reasons a hotel can have healthy website traffic and still generate surprisingly little direct business.
Traffic tells you that people arrived.
It does not tell you whether they understood the offer, trusted the property, saw enough value to continue or knew what to do next.
Sometimes the OTA is solving a problem you haven’t solved yourself
There is another reason hotels can become dependent on OTAs: the OTA is filling a commercial gap.
Perhaps the hotel’s own website has limited visibility. Perhaps the property has never invested seriously in search, content, partnerships or other forms of demand generation. Perhaps the hotel is excellent but relatively unknown outside its local market.
In that situation, Booking.com may be doing something the hotel currently cannot do at the same scale.
Removing it does not solve the underlying problem.
It simply removes one of the channels compensating for it.
This is why the objective should not automatically be to eliminate OTA bookings. For some properties, that would be commercially irresponsible. The objective should be to understand what the OTA is actually doing for the business and determine which part of that function the hotel should eventually be able to control itself.
That might mean improving the website. It might mean strengthening positioning. It might mean generating more qualified demand. It might mean making the direct booking journey easier. It might mean improving the way enquiries are handled.
The answer depends on where the dependency actually comes from.
The real question is where the demand came from
This is where the distinction between booking channel and demand source becomes important.
A reservation made directly on your website is not necessarily proof that the hotel controlled the entire journey that produced it. The guest might have discovered the hotel through an OTA, compared it there, read its reviews there and only then moved to the hotel’s website to complete the reservation.
Equally, an OTA booking is not automatically proof that the OTA generated the demand. The guest may already have known the hotel and simply chosen the OTA because it offered a familiar booking experience.
Looking only at the final transaction therefore gives you an incomplete picture.
You need to understand what happened before it.
Where did the guest discover the hotel? What made them consider it? Did they visit the website? Did they compare the property with an OTA? Did they enquire? Did they receive a quote? Did they abandon the direct journey and eventually book elsewhere?
The more of that journey you can see, the easier it becomes to distinguish genuine OTA-generated demand from demand that your hotel generated but failed to convert directly.
Your OTA share can hide two very different problems
Consider two hotels with exactly the same numbers: 60% of their bookings come through OTAs.
The first hotel is relatively unknown in its target markets. Most OTA guests discover the property while searching for accommodation in the destination. The hotel’s own website generates little qualified traffic and few direct enquiries.
The second hotel has strong brand recognition, substantial website traffic and a large number of guests who search for the property by name. Its website receives thousands of visits, but the direct booking process is weak and many of those visitors eventually book through an OTA.
Both hotels have the same OTA share.
They do not have the same problem.
The first hotel may need the OTA because it provides reach and discovery. The second may be paying an intermediary to convert demand it has already generated itself.
That distinction can represent a substantial commercial difference.
This is where the booking funnel matters
The hotel booking journey is not simply website → booking engine → reservation.
There are several steps before that, and problems at any of them can push the guest towards an OTA.
The hotel might not communicate its positioning clearly enough. The website might fail to answer an important question. The guest might not understand the difference between room categories. The direct rate might be presented without enough context. The booking engine might create unnecessary friction. An enquiry might receive a weak response. A quotation might communicate price without communicating value.
By the time the guest books through an OTA, the hotel may only see the final result.
The opportunity was lost somewhere earlier.
This is closely related to the problem of hotel booking conversion: the important question is not simply how many people eventually book, but how many qualified opportunities entered the hotel’s commercial journey and where they disappeared along the way. We looked at that in Your Occupancy and ADR Don’t Tell You Where You’re Losing Money, where the focus is on identifying the leakage between demand, enquiries and actual bookings.
The same problem can be a branding problem
There is also a connection between OTA dependence and brand execution that is easy to overlook.
Suppose your hotel positions itself around warmth, familiarity and personal service. The website communicates that idea beautifully. The photography feels intimate, the copy talks about personal attention and the property presents itself as an alternative to anonymous accommodation.
Then a potential guest sends an enquiry and receives a cold, automated response with a generic rate table and no reference to what they actually asked for.
The problem is not only that the enquiry may fail to convert.
The brand promise has also been contradicted by the commercial experience.
The guest does not separate these things. They do not think, “The branding was good but the reservations process was bad.” They experience one hotel, and every interaction contributes to their perception of what that hotel is like.
That is why OTA dependence can sometimes be a symptom of a much broader inconsistency between what a hotel says it is and what the guest actually experiences. The same issue can appear in the stay itself, where the intended experience and the delivered experience diverge, as we explored in Does Your Hotel Actually Deliver the Experience You Think It Does?.
Your OTA strategy should depend on the job the OTA is doing
There is nothing inherently wrong with using an OTA.
For an independent boutique hotel, the ability to reach international travellers, appear in comparison environments and generate bookings from people who have never heard of the property can be extremely valuable. The mistake is assuming that every OTA booking has the same economic and strategic meaning.
Some bookings are genuinely incremental.
Some are probably substitutable.
Some may be bookings that your hotel created the demand for but failed to capture directly.
And some may be repeat opportunities that you should be trying to move towards the direct channel over time.
Those categories require different decisions.
An OTA that consistently introduces new guests to your property is performing a different role from an OTA that captures guests who searched specifically for your hotel. If you treat both situations simply as “OTA dependency”, you lose the information you need to decide what should change.
Don’t try to remove the OTA before understanding why you need it
The temptation to reduce OTA dependence is understandable. Commission is visible, and the idea of keeping more of every booking is attractive.
But moving bookings from one channel to another is not a strategy on its own.
If your hotel does not generate enough demand without the OTA, you have a demand problem. If guests find your hotel but choose the OTA because your website is difficult to use, you have a conversion problem. If people enquire but do not book, you have a commercial process problem. If your positioning is unclear and the OTA communicates the value of the property better than you do, you have a positioning problem.
And if several of these things are happening at the same time, simply telling the marketing team to “get more direct bookings” is unlikely to fix any of them.
You need to find the leak first.
The OTA may not be taking your bookings. Your hotel may be giving them away.
This is the distinction that matters.
An OTA can generate demand that your hotel would struggle to reach on its own. It can also take a booking that was effectively yours before the guest ever opened the OTA.
Those two situations can look identical in a monthly channel report.
They are not identical commercially.
The goal should therefore not be to eliminate OTAs or to reach some arbitrary percentage of direct bookings. It should be to understand the role each channel is playing, identify where your own demand is being lost and build a direct channel capable of capturing the opportunities the hotel has already created.
That starts with the entire journey rather than the final transaction.
Where did the guest discover you? Why did they consider you? What happened when they reached your website? What happened when they asked a question? What did your quotation communicate? How easy was it to book? And if they eventually booked through an OTA, what made that channel more compelling or easier than booking with you?
Those are much more useful questions than simply asking how high your OTA percentage is.
Because sometimes the OTA really is the problem.
But sometimes it is just where you can finally see the problem.
