What is an OTA?
This abbreviation is often thrown around in the travel industry but for those of you who don’t know, OTA is short for Online Travel Agency. They are websites which pull together all the different flights, vacations and accommodation from major destinations so it’s easier to compare and find what you want. We’ve written about them in the past because there was a UK investigation into their sales tactics - but we’ll get to that in a moment.
You are more likely to use an OTA than go directly to an airline or hotel’s website, especially if you’re looking for a vacation over business travel.
They often display cheap deals and offers on the widest range of hotels, apartments and hostels in most cities. Plus, they’re the first website which will come up in a Google search, making them many people’s go-to.
So what’s the issue with them?
1. Fluctuating Prices
You know when you click on a hotel or flight, then close your browser to go do something else, only to come back later to find the price has increased? You worry the price will keep going up so you buy it there and then.
The cost of the booking hasn’t gone up because it’s selling out or because it’s closer to the date; OTAs track your digital movement and if they think you might buy it, they increase the price as part of a rush tactic.
This doesn’t happen on marketplaces like TransferTravel.com, where the prices are set by individuals, not an algorithm designed to catch you out.
2. Misleading Sales Tactics
Speaking of tactics, when you find a hotel or flight on an OTA, it might have some of the following next to it, usually in red writing:
- Last booked 4 minutes ago
- 12 people are also looking at this booking
- Only 3 left at this price
- 73% of hotels are usually sold out during your dates
Sound familiar? Whilst this might be true some of the time, it is certainly not all of the time. These sorts of “reminders” are designed to make you think that you need to buy now or risk losing it. In the UK, six of the biggest hotel aggregators have been called out for this and told to change their misleading sales tactics.
3. Hidden Fees
The advert you have seen on Facebook might have a reasonable price but by the time you click on it, the website price is completely different. OTAs will entice you with false promises on social media because by the time you get to the booking page, you’re too invested to turn back, even if it costs more than first advertised. This doesn’t just happen on social media.
When you’re thinking of taking a trip, OTAs are the first place you check for good deals, right? Like most of us, you probably sort accommodation by ‘price: low to high’ but when you click on the hotel you like, there is only a certain type of room on a certain date available. Sometimes the hotel tax (an added cost to the hotel bill in some countries) isn’t included in the price. For flights, there are extra costs for luggage (even hand luggage nowadays), printing off boarding passes, choice of seats, and so on. And after all that, when you finally get to the checkout, there’s a booking fee.
The price that’s advertised to you at first is never the price you pay at the end.
To avoid surprise costs, find a website you trust to be transparent about pricing, and where you can guarantee that you’re getting your travel plans at face value. We operate a ‘what you pay is what you see’ policy, which means that the prices you see on social media and in our website won’t include any nasty surprises.
4. Non-Refundable Bookings
We never anticipate to change our vacation plans but sometimes you have to, whether that’s due to a medical issue, unavoidable work commitment, or something else. Most OTAs won’t protect you if this is the case. It seems that once you’ve bought something from a travel aggregator, they wash their hands of you.
Bookings are usually non-refundable which means you end up out of pocket if you have to cancel. There is sometimes the option to book a flexible rate but if you didn’t choose that at the beginning of the booking process, you’re stuck with a trip that you can’t use. That’s unfair on you, the customer, as you can’t predict if something is going to prevent you from travelling.
On top of that, we feel pretty sorry for their customer service teams who must be inundated with hundreds of messages and calls from frustrated customers every day. There’s not much they can do to help you when they’re bound by rigid company rules.
You can transfer your bookings to someone else, such as a friend or a buyer in the marketplace, if you can change the name on your tickets. However, airlines in particular are guilty of charging extortionate name change fees which almost make it a waste of time to try to sell your travel plans.
Whilst 80% of travel bookings are transferable, the 20% which aren’t mean you are left with hundreds or thousands of pounds of travel plans which are useless to you.
How can OTAs do better?
We think that there are three things which they can do to support customers like you:
- Be honest, transparent and stable about pricing.
- Stop using rush tactics to make you buy when you’re not ready or at a price you’re not happy with.
- Make 100% of bookings transferable to give you the opportunity to get some of your money back.
If they do, customers will know they can trust them and be more loyal. If they don't, people will turn to TransferTravel.com and other reliable avenues for their travels, eventually rendering OTAs obsolete.