If you’re familiar with online travel agencies (OTAs), it’s likely that you’ve heard of the “billboard effect” – the descriptor given to the behavior of travelers who view OTA hotel listings for research and inspiration, but then book their rooms directly via hotel websites. Since the “billboard effect” was first noted in a 2009 Cornell University Hotel School study, it’s true impact on hotel bookings has been debated industry-wide.
For some hoteliers, the “billboard effect” helps validate the cost of listing on OTAs due to increased online exposure and volume of online bookings. However, there are others who are skeptical of its true value.
Recently, a follow-up Cornell study was published supporting the continued positive impact of the “billboard effect.” Here are a few insights from the new study, as well as findings from a recent Expedia survey.
- In making the case for or against the impact of the “billboard effect,” the final, definitive answer is… it’s complex. Aside from the most loyal hotel guests, most travelers utilize OTAs at some point along their path to purchase, supporting the notion that the “billboard effect” is still alive.
- During the 60 days prior to booking, 65% of consumers who booked directly with a hotel online visited an OTA prior to purchase.
- Within those 60 days, direct bookers visited OTAs an average of 7.2 times before booking directly with the hotel.
- Supporting these findings, a recent Expedia survey notes that compared against other online travel sites, OTAs have the highest rate of engagement (33%) among U.S. travelers within the 45 days prior to booking.
- Additionally, OTAs prove to be the most influential online resource in U.S. bookers’ destination decisions (17%), followed by airline sites (16%) and family/friend recommendations (14%).
Based on these findings, the “billboard effect” still plays a prominent role in the path to hotel room purchase for travelers. From our perspective at innRoad, we agree with the positive impact of the “billboard effect” due to the success our customers experience with the pairing of our cloud-based hotel software’s Global Distribution Services and Booking Engine. However, we’d love to hear your thoughts on the “billboard effect.” Click here to schedule an appointment with one of our experts and let us know how the “billboard effect” impacts your independent hotel.