The perfect channel mix doesn't exist. However, once you've defined what each channel can provide (for better or worse), the next step is knowing what practices to avoid so that distribution doesn't become an even more complex problem than it already is.
Controlling your hotel's distribution is crucial, both to achieve greater profitability and to respond to times of crisis or uncertainty with the greatest possible solvency. The lack of transparency in redistribution and the price struggle for end-customer satisfaction make this control very difficult (if not impossible) to achieve.
When diving into the complex world of distribution, we must avoid temptation as much as possible through some good practices:
- Focus on controlling the most relevant channelsIf you start spreading yourself too thin, your distribution will become uncoordinated and unprofitable.
- Know the real profitability of each channelCalculate the net cost of each channel's contribution. Only by knowing the true cost of distribution and the net return of each channel can we determine the real value they contribute (not only in terms of revenue, but also when they help fill the hotel) and make the right decisions, thoroughly clean up the channels that, instead of contributing to your distribution, hinder it, and maintain those that can support you in healthy and profitable marketing.
- Don't let other channels gain your customer loyalty: Feeding third-party loyalty programs helps them retain your customer. Once the first reservation is closed, the channel will not hesitate to offer the customer any alternative accommodation in the future for their benefit, not yours. Building customer loyalty allows you to take control of the relationship with the direct customer, develop more effective communication, access their data and purchasing habits, and be able to further personalize your message and reduce that customer's acquisition cost in the future.
- Be obsessive about your online presence and reputationThe direct channel is strategic for your distribution and should be at the top of any establishment's priorities. An attractive and user-friendly website, with a robust booking engine that promotes conversion, is a mandatory requirement for this to work. But also take care of your online reputation because, while it may not generate sales on its own, it can be decisive in tipping the balance in your favor. And, above all, be visible where the customer is.
- Take care of your priceThe end of parity is a reality. Many intermediaries offer end customers a more advantageous shopping experience compared to their direct channel, which shifts sales to them. And the hotel industry itself has fueled its own disparities in recent years, offering benefits to OTA loyalty programs and increasing its commissions and margins for preferential programs. Therefore, controlling their price distribution is essential.
Hotel distribution can be complex and challenging, and it's easy to fall into temptation. We've all committed one of these sins at least once. Controlling distribution channels and their profitability, maintaining online presence and reputation, building customer loyalty, and considering the true cost of direct sales are just a few of the practices that can help improve hotel distribution.