Reservation Management Sales & Marketing
Pros & Cons of Online Travel Agents OTAs for a Tour & Activity Company

In today's digital era, tour and activity companies are increasingly turning to online travel agents (OTAs) or resellers to expand their reach, increase sales, and streamline their booking processes. This blog aims to delve into the advantages and disadvantages of incorporating OTAs into a tour and activity company's booking network. Specifically, we will address how OTAs can help businesses reach more buyers, increase sales, and utilize unsold inventory effectively.  


Understanding OTAs: Online Travel Agents 

Online Travel Agents (OTAs) are third-party platforms that connect travelers with various travel services, including accommodations, flights, car rentals, and tour and activity bookings. They act as intermediaries between customers and travel providers, offering a centralized platform for users to explore, compare, and book travel-related products and services.  Below is a listing of the Pros and Cons of Online Travel Agents OTAs for Tour and Activity Companies.


Pros of Utilizing OTAs for Tour and Activity Companies

  1. Grow Tour and Activity Sales by Expanding Reach and Increased Sales: By partnering with OTAs, tour and activity companies can tap into a broader customer base and gain exposure to a larger audience. OTAs have extensive marketing and distribution networks, enabling businesses to showcase their offerings to potential customers worldwide. This increased visibility can lead to a significant boost in bookings and revenue.
  2. Access to Targeted Marketing: OTAs invest in marketing campaigns and employ sophisticated algorithms to target specific customer segments. By leveraging the OTA's marketing capabilities
  3. Streamlined Booking Process: OTAs provide a user-friendly booking interface that simplifies the reservation process for customers. By integrating with an OTA, tour, and activity companies can offer seamless online booking experiences, enhancing customer satisfaction. Additionally, OTAs typically offer secure payment processing, reducing the administrative burden on tour operators.
  4. Increased Visibility for Unsold Inventory: Tour and activity companies often face challenges in selling their entire inventory. By partnering with OTAs, businesses can make use of unsold capacity that might otherwise go to waste. OTAs allow tour operators to list and promote their unsold slots, attracting last-minute bookings and optimizing resource utilization. This not only helps generate additional revenue but also minimizes losses due to unsold inventory.


The Cons and Considerations for Working with OTAs

  1. Commission Fees: One of the primary disadvantages of working with OTAs is the commission fees charged for each booking. OTAs typically charge a percentage-based commission on each reservation, reducing the tour operator's profit margins. Companies should carefully evaluate the commission structures and compare them with the potential benefits before partnering with an OTA.
  2. Managing multiple reservation platforms can be time-consuming and cause you to easily oversell.  
  3. Dependency on OTA Performance: When tour and activity companies rely heavily on OTAs for bookings, they become vulnerable to fluctuations in the OTA's performance. Changes in algorithms, search ranking, or policy updates by the OTA can impact a business's visibility and, consequently, its bookings. Diversifying distribution channels can help mitigate this risk.
  4. Loss of Direct Customer Relationship: When customers book through an OTA, the tour and activity company may lose direct access to their contact information. This limits the company's ability to build a long-term relationships, gather feedback, and offer personalized experiences. It's crucial for businesses to find a balance between utilizing OTAs for increased reach and retaining direct customer interactions through other channels.


Streamline it using a Tour & Activity Reservation Software that Integrates with OTA's is the Best Solution  

Incorporating OTAs into the booking network of tour and activity companies can offer numerous advantages, including expanded reach, increased sales, streamlined booking processes, and effective utilization of unsold inventory. That said, it is highly recommended that you select a tour operator software like aReservation by Indexic which seamlessly connects with the World’s most popular resellers. In doing so you will have just one platform to manage your entire business. Plus, you will be able to allocate all of your inventory or just a percentage.  In doing so you will expand your marketing reach to more buyers and increase your sales. However, businesses must carefully evaluate the associated commission fees, dependency on OTA performance, and potential loss of direct customer relationships. By finding the right balance and diversifying their distribution channels, tour and activity companies can harness the power of OTAs to grow their business while retaining control and flexibility in the market.