All OTAs charge 15% commission?

OTA = Online Travel Agency, which means those sites that sell the booking and take the payment for you.
May_8
Posts: 13
Joined: Tue Jan 30, 2018 6:41 pm

All OTAs charge 15% commission?

Post by May_8 »

Hello,

I’ve been researching Channel Managers and thought Eviivo looked a good option. However, they tell me that all OTAs; Air BnB, Expedia, Booking.com, Trip Advisor etc will charge me a flat rate of 15% commission on all bookings?! I’ve got a bit of a shock, because having looked independently it seemed more like 3% which is a big difference! I could increase my prices to allow for this, but I’m concerned it won’t make me very competitive and will raise guest’s expectations.

Is this right?
Joanna
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Location: Chester, North West England & Sidmouth, East Devon
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Post by Joanna »

I think it depends - I calculated that ABB are charging us 3.6% if you include VAT. But they're also charging guests around 12% too and the total combined could well add 15% on top of our base prices. There was also a move by ABB to stop charging guests and put all the fees onto owners so they could advertise as 'fee free bookings'. I think they were rolling this out in some areas or maybe owners could opt in - I can't actually remember what came of that. AFAIK we're still on 3% + VAT. But that is probably where the 15% figure is coming from.
Jo

Joint owner of Baker's Cottage in Chester & Chandler's Cottage in Sidmouth
newtimber
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Post by newtimber »

Most booking systems allow you to increase your rates for OTA bookings. This means that your direct bookings remain at a competitive price for repeat bookers and those who know how to book direct and want cheaper prices can do so.
May_8
Posts: 13
Joined: Tue Jan 30, 2018 6:41 pm

Post by May_8 »

Thank you Joanna and newtimber. It seems the 15% through Air BnB does indeed incorporate the booking fee the guest would otherwise pay. There seems to be two ways of taking bookings with Air BnB. Will do as Newtimber suggests, and encourage direct bookings where we can.
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paolo
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Post by paolo »

The future of OTAs is they will add a commission of about 15%, maybe more, to your rates. The commission will be all paid by you rather than split with the renter as it is now. This will allow them to say that renters pay zero commission.

In practical terms nothing will change, there will still be a 15%-ish difference between your published rate and what you pocket, as there is now.
Paolo
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