Digital transformation in the hotel business: tourists prefer online booking

By Tychyna TetianaJan 25, 2024 23:46 PMNews
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Digital transformation in the hotel business: tourists prefer online booking
Hotel reservations. Source: Freepik

The hospitality industry is experiencing a peak in digital bookings. The data were based on the analysis of H2c Digital Hotel Operations for 2023, which examined the reviews of 84 hotel chains representing 17,406 hotels with more than 2 million rooms.

According to the analysis, the share of direct bookings increased by almost 50% in 2023 compared to 2022. Simultaneously, almost a third of all bookings last year were made directly, according to the PhocusWire article.

At the same time, the level of digitalization of hotels is relatively high - 6 points on a 10-point scale. The level of personalization was even lower, with hotels scoring 4.6. Nevertheless, this marks an improvement compared to the rating of 3.6 in 2021.

According to experts, almost two-thirds of the total revenue of hotel chains is now booked online. Although online travel agencies still contribute the majority of this amount, direct booking is catching up.

Meanwhile, the number of bookings through OTAs decreased from 39% in 2022 to 34% last year, while the number of direct bookings increased from 20% to 29% over the same period.

The most significant decline occurred in offline bookings, which accounted for only a quarter of total bookings in 2023, compared to one-third in the previous year.

Experts suggest that revenue growth is possible through additional automated promotions, a finding confirmed by respondents (increasing from 15% to 29%).

Upsell offers are most often made during booking (78%), in pre-arrival emails (67%), or during check-in (65%).

Furthermore, the use of artificial intelligence shows promising opportunities for the development of the hotel business. According to the study, artificial intelligence demonstrated a "staggering 53% growth," reaching 86%.

At the same time, experts note obstacles to achieving higher rates of digitalization. Chief among them was the perceived high cost of acquiring new technological solutions, identified by 83% of respondents.

According to experts, a significant gap in the hotel industry lies in online reputation management, which was only integrated into 42% of hotels. The report refers to this as a "missed opportunity, as guest feedback can be immediately utilized."

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