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Update Corona Impact on Website vs OTA Bookings

Thursday, March 5, 2020  
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Update Corona Impact on Website vs OTA Bookings

 Hospitality Net - March 5, 2020

Over the last 24 hours we digged a bit deeper into the Corona Impact. This time with our partner Hotelnetsolutions from Berlin, who provide over 2000 Hotels predominantly in der German speaking areas and we work together for over 6 years on all online marketing aspects like Google, trivago and tripadvisor.

What we looked at?
Cancellation Rates - all hotels suffer currently under a major cancellation impact. But what segments are actually really affected. After several talks with many hotels I understood that mainly groups and corporate travel was affected. But what is happening in the online world, where a lot of unorganized business and leisure travel happens?

Our approach was simple. We looked at Booking and cancellations happening in January and February 2020 and compared this with the same numbers from 1st March to 5th March. See the chart below:

Update Corona Impact on Website vs OTA Bookings
While OTA's cancellations rates in the first two month were around 22%, they went up to over 55% across all three big OTA's in Germany. Website Cancellations at the same time only increased from 5% to 13%.

Conclusion 1
We all know for years that website bookings generate a much higher value due to significantly lower cancellation rates, but now it is an obvious fact that even in time of crisis those customers have a much higher loyalty vs OTA bookers.

Conclusion 2
Metasearch driving business through your own website are on the same behavior and have the same cancellation rate as other website bookers. This is another strong argument that Meta has a strong impact on customer loyalty just as much as it can deliver clients to a much lower cost of distribution (at myhotelshop average Costs are around 12% vs OTA's at 16-17%)

Booking volume - second evaluation was around how much bookings dropped in the last 5 days. This is a bit tricky, as many aspects pay into this. So we took the average bookings per day in Jan/Feb 2020 and compared it to the same number on March (1st to 5th). Then we looked at the downturn.

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