The hotel distribution industry is shifting as hotels reduce OTA reliance and prioritize direct guest relationships
Feb 25, 2025
Historically, intermediaries have dominated the booking process, charging high commissions and limiting hotel control over pricing and customer data. But with evolving technology, shifting regulations and changing consumer behavior, the industry has an opportunity to redefine its distribution model. The future lies in a balanced approach that leverages direct bookings, personalization and technological innovation to create a more sustainable and guest-centric ecosystem.
Key takeaways
- Healthier channel mix: Rising OTA commissions (up to 40%) are making direct bookings a priority for hotels; by 2030, direct digital bookings are expected to surpass OTAs, generating over $400 billion;
- Personalization & differentiation: The shift to experiential travel is driving demand for customized offerings; AI and data analytics enable hyper-personalized guest experiences and targeted marketing; loyalty programs are evolving beyond traditional points systems to personalized rewards;
- Customer-first approach: OTAs often prioritize high-commission hotels, limiting true consumer choice; regulatory measures such as the EU’s Digital Markets Act (DMA) aim to create a fairer distribution ecosystem;
- End of rate parity clauses: Legal rulings, including the EU Court of Justice decision, allow hotels to set their own rates; hotels need to invest in direct booking strategies using technology and competitive pricing;
- Rise of mobile bookings: Over 50% of hotel bookings now come from mobile devices, making mobile-first design critical; Historically, only OTAs and large hotel chains have capitalized on mobile apps, but new platforms are looking to change that;
- AI’s role in distribution: AI-powered chatbots, price optimization, and personalized marketing will improve direct bookings; AI-driven solutions such as D3X.ai (intelligent agents) and Allora.ai (booking platforms) are already disrupting the market.
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