HOTREC European Hotel Distribution Study 2024

HOTREC, the European umbrella association of hotels, restaurants and cafés, conducted between February and April 20224 in collaboration with the University of Applied Sciences of Western Switzerland Valais (HEV-SO Valais-Wallis) its biennial study on the European hotel distribution market.

Find below a summary of the information related to the Direct Channel, the Meteasearch, and the OTAs undercutting issues. Find the Hotrec full Study here, which includes plenty of data and interesting information.

SAMPLE SIZE

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• Total responses: Collected 2,537 responses from individual hotels through the online survey from 35 countries.
• Additional data: Aggregated information from 10 hotel chains covering 552 properties in 9 countries.
• Total sample size: The study is based on information from 3,089 hotels overall​​.

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THE DIRECT CHANNEL

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• Dominance of direct channels: Direct channels remain the most important sales channels for the European hotel industry, accounting for 50.9% of overnight stays in 2023.
• Components of Direct Channels‍: ‍
  • Telephone: 16.4%.
  • E-mail: 15.8%.
  • Real-time booking on own website: 12.1%.
  • Contact form on own website: 5.9%.
  • Walk-in: 3.5
  • Mail / Fax: 1.3
• Importance of Internet booking engines: The use of booking engines on hotel websites has increased significantly, allowing guests to book rooms directly on hotel websites in real time. This trend is reflected in the increase in the share of bookings through such systems, from 7.4% in 2013 to 12.3% in 2023.
• Shift Toward Digitization: The increase in the use of IBEs and other digital tools highlights the industry's move towards digitalization and the efforts to provide a seamless and user-friendly booking experience for customers.

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METASEARCH ENGINES

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• Increased Awareness and Usage: Awareness of meta-search engines among hoteliers has increased dramatically over the past decade. In 2013, almost half of the hotels were unaware of the opportunities for integration with meta-search engines, whereas, by 2023, around 80% of respondents were aware of this distribution channel.
• Adoption Rate: By 2023, 46% of hotels reported using meta-search engines as a distribution strategy. This indicates a growing adoption of these platforms for enhancing online visibility and direct bookings.
• Popular metasearch platforms: There has been a significant shift in the dominance of metasearch platforms over the years. In 2013, TripAdvisor was the leading metasearch platform, with a 71% share of usage. In 2023, Google Hotel Ads emerged as the market leader with an 80% share of usage, followed by TripAdvisor with 44% and Trivago with 36%.
• Segment-Specific Usage:
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  • Hotel chains: 68% use metasearch engines compared to 40% of independent hotels.
  • 50-100 room hotels: 52% use metasearch engines.
  • Hotels with more than 100 rooms: 65% use metasearch engines.
  • 4 and 5 star hotels: 54% and 71% respectively.
  • Hotels in cities with more than 250,000 inhabitants: 57% use metasearch engines.
  • Hotels with more than 30-39% of bookings through OTAs: 51% use metasearch engines versus 33% of hotels with less than 10% of bookings through OTAs.

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DISPARITY ISSUES ON THE PART OF OTA

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• Predominance of selling below the hotel's web price: The disparity on the part of OTAs, in cases where an OTA reduces the price set by a hotel by waiving part of its commission, affects a significant portion of hotels. Specifically, four out of ten hotels claim to have suffered from this practice.
• Frequency of OTA selling below the hotel's web price: Among the hotels affected by the disparity, 16% state that this practice occurs frequently.
• Lack of agreement: A substantial majority of hotels (three out of four) have yet to agree to these price cuts initiated by OTAs, indicating that this practice is often done without the hotels' consent.
• Impact on Pricing: More than half of the affected hotels see price reductions ranging from 6% to 10%. Additionally, every tenth property experiences price cuts between 11% and 15%.

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