Hotel Rate Parity. What Is It About?

Some might say that offering rate parity is one of the fairest ways of conducting rate strategies. So, what does rate parity actually means? 


Hotel rate parity is when the hotels are implementing the same rate across all distribution channels including their own hotel websites. It is a legal agreement between the hotels and Online Travel Agencies (OTAs) where they agree to offer the same rate on all platforms that they sell regardless of how much commission they have to pay to OTAs. Hotels are also not allowed to undercut the room prices that OTAs display on their platforms.

Advantages of Rate Parity

Since rate parity brings transparency in room selling price, it also brings confidence to the traveller while considering making a room booking no matter which platform they choose to book. With this, hoteliers can take advantage in building customer loyalty and encourage them to book directly where they could not earn any special services from other third parties or OTAs.

Tips on how to educate your audience to book direct

  • Use Promo Code or Special Discounts

Offer a special promotion code through social media or make a pop-up poster on your hotel website so your audience know that they will enjoy special discounts if book direct

  • Loyalty Program

A loyalty program is another idea to encourage more direct booking where you can offer free night stay or extra breakfast with specific terms and conditions that you set. Loyalty card is a popular example that many hotels are now using. 

  • A Seamless Booking Process

A difficult and unfriendly booking process can be a bad experience for your potential guests. They might leave the hotel website before proceeding to confirm the booking due to an uneasy booking process. 

Read also: Direct Booking Tools for Hotel

How Can Hotel Better Manage Rate Parity? 

  • Get a Channel Manager

    Hotel Channel Manager in MALAYSIA-1

By having a Channel Manager, you can easily connect and manage all your distribution channels with a single platform. This will help you to better manage rate parity where you could easily check prices on different channels

Read also: How does Channel Manager Work

  • Get a Hotel Website that supports SEO and is Mobile Friendly

    Mobile Friendly hotel website

While educating your audience about direct booking, you have to ensure that your hotel website is mobile friendly and responsive. The call to action buttons should be visible as well.

Besides that, you have to grow your hotel presence on metasearch engines. This will help to increase brand awareness which will result in more hotel direct bookings.

Conclusion

Rate parity can be good and bad. It depends on how you manage the rate parity and how you take advantage of it. Imagine a day without rate parity, what will happen? 

OTA has been in the industry for so long. It is another tool to create brand awareness for your hotel. In order to better manage rate parity, you need to be smart to know what strategies to implement.


With a mission to make hotelier work easier, Softinn Solutions Sdn. Bhd. is a hotel-technology provider company offering hotel management software. Ranging from cloud-based hotel PMS, hotel booking engine, and a specially customized hotel website; Softinn is adept in employing innovative ideas in its solutions constantly and understanding the requirements of hotel industry worldwide. 


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