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A year in review: OTA trends

A year in review: OTA trends

A Year in Review: OTA Trends

OTAs have a long history and are constantly evolving to keep up with changing consumer demands. The pandemic affected every single aspect of the travel industry, and OTAs adapted to include more service offerings than ever before, innovative categories, and unique travel experiences to appeal to guests today.

OTAs bounce back with a vengeance

2021 was a year of immense learning and change for properties and OTAs as travel ramped up again after significant declines due to the pandemic. Before the pandemic, Cloudbeds internal data showed that OTAs contributed a third of occupancy for properties, but in 2020, OTA contribution dropped to staggering lows. Website contributions or direct bookings overtook OTAs and continue to lead; however, we’ve seen OTAs start to climb back to 2019 numbers thanks to lifted travel restrictions and changes implemented by OTAs.
OTA vs. website occupancy

OTAs find new ways to entice travelers with sustainability badges and long-term stays

61% of global travelers say the pandemic has made them want to travel more sustainably in the future, with more than 73% of travelers more likely to choose accommodations that have implemented sustainability practices. The increasing importance of sustainable travel options has prompted OTAs such as and Expedia to implement new sustainability categories and initiatives.
Properties on, for example, can choose from 32 sustainability practices verified by independent sustainability experts. These properties then receive a “Travel Sustainable Badge” to display on their listing, informing travelers of their sustainability efforts.
Long-term stays have also become an important selling proposition for OTAs as people have increased flexibility for extended travel with remote work and “workcations” becoming more popular. Airbnb’s Q3 2021 earnings report showed that long-term stays of 28 days or more are the company’s fastest-growing trip length, up 14% from the previous year. Agoda offers a specialized landing page called “Agoda Long Stay” where they offer travelers discounted, contract-free rates on stays longer than 30 days. Long-term stays are beneficial for property owners as they provide consistent income and take the pressure off of constantly attracting new guests.

Business travel lags while domestic leisure travel soars

Travel analysts predict that it will take until 2024 or 2025 for business travel to recover to pre-pandemic rates — if it ever does. Companies have realized the efficiencies associated with remote work and meetings, reducing the need for business travel.
At Cloudbeds, we predict that some shifts in business travel will be here to stay for good. Bleisure travel, a blend of leisure and business travel, will extend the length of previously short business trips so that travelers can spend time exploring after office hours. Extended bleisure stays, combined with increased remote work, will continue the surge in demand that we saw over the pandemic for short-term rentals.
Properties that want to capitalize on this shift must provide proper amenities such as high-speed internet, desks, and coffee machines to entice workers to book extended work trips at their property. Last year, Airbnb introduced Wi-Fi testing for hosts to showcase their Wi-Fi speeds to give travelers visibility into what level of connectivity they can expect. Properties that have speeds above 50Mbps will receive a “fast Wi-Fi” amenity beside their listing.
On the flip side, unpredictable global restrictions have made domestic leisure travel more attractive and popular. According to Statista, during the pandemic, the United States contended with 1.4 billion domestic trips, and, in the United Kingdom, 75% of all travel spend came from domestic tourism alone. Properties that want to attract domestic travelers for weekend trips or staycations should seek out prominent regional OTAs.
Learn how to get OTAs working for your property

OTAs expand to include unique travel experiences & a full spectrum of offerings

Deloitte’s 2022 Travel Outlook report identified that younger and wealthier travelers are leading the return to travel. These demographics expect unique travel experiences, such as staying in a luxury treehouse or a converted grain silo in the middle of the desert. Airbnb recently added 56 new vacation rental categories, including tiny homes, caves, castles, and yurts. In the first quarter of 2022, nights booked for summer travel to these unique property types have increased by 80%. In June 2022, Airbnb announced their $10 million OMG! Fund which was created to finance 100 property owners as they transform their property into a truly unique travel destination. Hostelworld also recently introduced “Roamies," a new group tour option for like-minded travelers who seek to visit lesser-known spots and interact with local communities.
OTAs have felt the pressure to expand their product offerings to provide a full-service experience for visitors, including access to flights, tours, restaurants, activities, and car rentals. Recently, and Hopper expanded into full-service OTAs offering flight, accommodation, and activity options by utilizing partnerships with travel companies. Hostelworld has also expanded its offerings to include low-budget hotels and bed and breakfasts.

Google Hotel Search disrupts the OTA space

Google Hotel Search has disrupted the online travel industry, changing how travelers book their vacations. When a traveler enters a property name into Google, the site will return a list of hotel rates from various OTAs on which the property is listed. Clicking on a rate will take a traveler directly to that OTA to book.
In 2021, Google introduced free booking links, allowing an individual property to list their direct rates within the Google Hotel search box for free. In 2022, this initiative was expanded to include free booking links in both Google Search and Maps, meaning that properties now have an added way to capture direct bookings at multiple points on the Google platform. At Cloudbeds, Google - via free booking links has - quickly become a top-performing channel for our hoteliers, ranking as one of the top revenue-generating channels in major countries such as the USA and Canada..
Google Hotel Search products

Airbnb’s rapid expansion

Airbnb recorded its best year ever in 2021 with over $1.5 billion USD in revenue in its fourth quarter. Its main challenge now is finding hosts to meet the increasing travel demand. A notable increase in demand has been for more long-term stays with Airbnb seeing an increase in monthly and weekly stays.
Airbnb has also made investments in new and exciting ways to entice travelers to use their site. In 2021 Airbnb released over 150 new features, and in June 2022 they launched 3 new offerings:
Airbnb Categories – A new way to search that makes it easy to discover millions of properties across different categories
Split Stays – A feature that provides more options for longer stays by splitting trips between two properties
AirCover for guests – A comprehensive protection in travel, included for free with every stay.
Airbnb’s own success is pushing other OTAs to expand their offerings and move into new markets to change the future landscape of travel.

The Big Book of OTAs

Get the Hotelier’s Guide to Top Distribution Channels, including
  • Recipe for ideal channel mix
  • Top performing OTAs in your region
  • Directory of 75+ OTAs
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