The Pros and Cons of Direct Booking Websites vs OTA

As a short-term rental owner, you have two options for booking: direct booking or using an online travel agency (OTA). Each option has its own advantages and disadvantages, and it's important to weigh them carefully before making a decision. In this article, we'll explore the pros and cons of each option to help you make an informed choice.

What are Direct Booking Websites and OTAs?

Direct Bookings refer to when a guest books directly with the property owner or manager, without the use of a third-party platform. This transaction typically occurs on a host or property manager’s own website.

OTA, on the other hand, stands for online travel agency, which is a platform that allows guests to book short-term rentals through aggregated sites. Examples of popular OTAs include Airbnb, Booking.com, and VRBO.

Pros of Direct Booking Websites

One of the biggest advantages of a direct booking website is that it gives you more control over your rental property, including pricing, complaints, and cancellation policies. OTAs typically control the customer experience as well, and companies like Airbnb typically side with the host. When you have a direct booking site, it lets you work out issues with the guests directly. By choosing the best direct booking platform, you can create a seamless experience for your guests with a direct booking website builder tailored to your needs. For example, you may want to make your house rules more clear, or you may want to point out a few tips and tricks for using your rental.

Another advantage of a direct booking site is that it allows you to build a relationship with your guests. By communicating directly with them, you can provide a more personalized experience and address any concerns or questions they may have. Direct booking sites lets you go a bit further into the relationship by giving you the ability to implement a vacation rental loyalty program. This helps you stand out from the competition and encourage repeat business. Short-term rental points programs, like the one offered by the48dots, make it easy for hosts to reward their loyal guests and foster a sense of community. With a loyalty program for vacation rentals, you'll not only increase guest satisfaction but also boost your revenue by attracting more bookings through direct channels.

Finally, direct booking eliminates the need to pay commission fees to third-party platforms, which can save you money in the long run.

Cons of Direct Booking Websites

While there are many benefits to direct booking, there are also some potential drawbacks to consider. One of the biggest challenges is that it requires more effort on your part to market your property and attract guests. Without the exposure provided by OTA platforms, you may need to invest more time and resources into advertising and promoting your rental. Additionally, direct booking may not be as easy to find for guests who are accustomed to using OTA platforms to search for and book accommodations.

Tip: the48dots helps with discoverability, marketing, and ease of use. If you have a direct booking site, make sure you list it on our platform so that we can direct guests to your site. the48dots aggregates direct booking sites, much like OTAs, except we don’t require the booking transaction to occur on our site. We simply use the power of all the direct booking hosts to draw traffic to our platform, and then we send the traffic back to each individual site owner when it’s a match for the guest.

Finally, direct booking websites may not provide the same level of protection and security for both hosts and guests as OTA platforms, which typically offer insurance and dispute resolution services.

Pros of an OTA

One of the biggest advantages of using OTA platforms is the exposure they provide for your rental property. These platforms have large user bases and extensive marketing campaigns, which can help you reach a wider audience and attract more guests. That’s why many hosts list on an OTA in addition to their direct booking site.

Tip: If you list on an OTA, make sure to get the guest’s information so that you can re-market your listing. Bring the guest back to your direct booking site and offer the48dots loyalty points to keep them engaged.

Additionally, OTA platforms typically offer a range of services and features that can make it easier to manage your rental, such as automated booking and payment processing, guest communication tools, and review systems. These are features you can build, and often come out of the box if you use a great direct booking website builder. For example, you’ll need to integrate payment processing yourself, but Stripe offers a no/low-code tool to make this easy for you. Many direct booking site builders have Stripe as an out-of-the-box feature.

Finally, OTA platforms often provide insurance and dispute resolution services to protect both hosts and guests in case of any issues or conflicts.

Cons of an OTA

One of the biggest cons of OTAs are the fees associated with using these platforms. OTA platforms typically charge hosts a commission on each booking, which can range from 10% to 20% or more. This can significantly eat into your profits, especially if you rely heavily on OTA bookings.

Additionally, OTA platforms may have strict policies and regulations that can limit your control over your rental property, such as cancellation policies and guest requirements. They also have a guest review system that is hard to work with for many hosts. A single finicky guest can hurt your ratings, prioritization of your listing in search results, and future bookings.

Finally, relying solely on OTA platforms for bookings can leave you vulnerable to changes in the market or platform policies, which can impact your business. Our recommendation is to diversify with a blended OTA/Direct Booking Websites/the48dots listing strategy.