With many reputations damaged amid poor service and untimely refunds during the pandemic, OTAs (online travel agencies) must reconsider their strategies to win back consumers as confidence in rival tour operators and direct bookings increase.
Some of the UK’s top tour operators have seen significant booking increases over the weekend of 18th September, with Jet2Holidays reporting a 250% increase in reservations. Direct bookings have also increased its market share by 10% in 2020. The figures show considerable faith by UK travellers to book directly with providers, including two of the UK’s larger tour operators. According to a recent GlobalData survey, 48% of people would prefer to book directly with a supplier, whereas only 16% would book with an OTA. Ultimately, the shift away from OTAs will increase pressure on this sector.
Lessons must be learned from the pandemic
Household brand names such as Onthebeach, Teletext Holidays and lastminute.com have received negative press over untimely refunds and legal battles during the pandemic. Furthermore, low-cost airline Ryanair has added fuel to the fire by accusing OTAs of providing fake details to pay for flights and adding excessive fees within its direct booking campaign. Unfortunately, negative press stories continue to damage the reputations of UK-based OTAs, resulting in a fall in confidence to book in this way. According to GlobalData Q1 2021 consumer survey, 51% of UK respondents said they were either ‘always’ or ‘often’ influenced by a product’s trustworthiness, highlighting how problematic the negative press could be towards OTAs.
To win back customers, OTAs must refocus on providing quality customer service. Lessons must be learned from past issues. For many OTAs, there was a lack of crisis management during the pandemic, with customers left confused about their refund rights amid changing travel restrictions. While an unprecedented time that was almost impossible to predict, tour operators and direct accommodation providers better supported their bookings during the pandemic. These businesses offered flexibility, reassurance, and communication which was important to travellers.
This reflects the change in consumer preference. Customers need more information and reassurance and in many instances booking direct provides this. The UK’s top tour operators have tackled demand for direct bookings better than OTAs through quality information, guidance, and equally flexible booking options. For example, Jet2holidays has provided specific step-by-step instructions regarding red, amber and green destinations (and soon the new travel rules), as well as providing flexible changes and cancellations.
High-quality customer service is vital
Quality customer service and communication will now be key to survival in the pandemic recovery. Building on strong supplier relations, operational restructure and creating an agile business will also be important. Strategic marketing and highlighting the processes in place will support the return of custom. However, the question remains as to whether OTAs have what it takes to win back consumer demand and compete with tour operators and direct bookings.