Building an OTA Software: business model and key features
7 minutes read
7 minutes read
Building an OTA software may seem a concern for the upcoming players on the Travel market or for those who want to scale their business. One of the main reasons for that is the solidly established names of such giants as Booking, Airbnb, Expedia, and Kayak. Is it even possible to find a place for a brand-new travel agency in this competitive market? If the answer is yes, then what steps to follow to create a unique product? Let’s figure it out.
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In general, Online Travel Agencies (OTA) are marketplaces, connecting travelers and such service providers as hotels, guides, transfer companies, and hotels. Service providers are interested in extending sales channels and the OTA choice appears to be beneficial for them. OTAs bring value to both: service providers and travelers, by contributing to smooth trip planning and offering the whole package of services on the all-in-one platform. Online booking on these platforms has made traveling agendas personalized as well as much clearer and quicker. The OTA software makes it easy to choose the best option in advance so when a traveler arrives, everything is ready.
When planning on your OTA, it’s worth considering the actual filtering of those, that may help you to define the group you want your OTA to belong to and emphasize the uniqueness of your future platform. OTAs can be grouped either geographically or by the scope of services.
On account that 72% of new customers read reviews before booking, almost all OTAs offer additional services, like reviews or travel guides. That helps them create the trust of the travelers and, as a result, get a loyal audience and increase sales.
When it comes to the distribution chain on the OTAs, here go two the most popular ways: channel management system and API. Hotels and property managers can distribute their inventory through the channel manager. It allows the automated synchronization of the room or property details, its updates, and provides you with a variety of potential integrated hotels, once your OTA is integrated with the Channel Management System. Though it seems to be a reliable way of distribution, the channel has its drawbacks as well. As a rule, the channel takes a commission that is paid either by the hotel or by the traveler. That is what makes the final price on the OTA platform not so appealing.
The second option available for OTAs – is API. This tool may be developed and initiated both by the OTA platform and Property Management System (PMS). The decision depends on the size of OTA. The platform can have its own API or connect to the one of PMS. Let’s switch our attention from hoteliers to property managers, as for the example. As our experience demonstrates, property managers are not likely to connect through API, they prefer to store their properties in PMS. Consequently, the API should come along with PMS and the OTA, as well.
To remain competitive, travel industry companies need to take advantage of APIs since if they are implemented and managed effectively, you get a chance to become one of the key players in the industry. It’s important to be fully aware of your IT infrastructure, and this is where IT partners can be valuable. Once you have the details about the data storage (that can be stored in a CRM, Enterprise Resource Planning (ERP), or a cloud-based software), you’ll be able to get an API designed specifically for your business needs.
Typically, the main user roles on OTA include property manager or hotel and traveler. For each of these users, there should be a set of certain capabilities in the platform.
Hotel/ Property Manager should be able to:
A traveler should be able to:
To allow all the above-mentioned capabilities to be smoothly integrated and performed by the users, OTA should consist of the following elements:
Apart from the basic functionalities, that we described above, there are additional ones that will promote your chances to become one of the top OTAs:
What’s important is that you do not limit yourself to these advanced features described above. If you have an exceptional idea that will promote bringing more value to the users, discuss it with the advanced software development team, that has expertise in developing solutions for the travel industry. As you are all set up with the idea, it’s time to work on the development strategy definition.
To ensure an efficient development process, that entails a transparent and smooth communication process with the development team, it’s worth considering the following approach:
We, at ASD team, stick to such a development process that influences the successful and fast realization of our client’s ideas. By offering full technology responsibility for the project, we guarantee the expert software development of bespoke solutions for the Travel & Hospitality industry.
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