Tricks OTAs are playing in 2024 to skyrocket their revenues (+ how to avoid being cheated)
Here are the tricks you didn’t know OTAs use to impact the price (some of them might even sound offensive).
You can’t focus on something that’s not pleasant for long, that’s understandable. But did you know that, on average, people start losing interest in approximately 42 minutes, even when planning their own vacation? It makes sense when an average person spends more than 10 hours planning ONE holiday & searching for the best rates.
It’s especially relevant since the Covid pandemic has hit the travel industry harshly: it resulted in enormously decreased revenues & the travel industry is eager to earn that money back. Did you ever consider that the pandemic’s effect on you (and your wallet) is way more significant than not being able to travel for a while? You’re the one paying for the poor revenue. The OTAs need to get back on track with their income & YOU searching for the best hotel for your vacation is their way to achieving it quickly.
Let's dive down to the tricks:
#1 DISCRIMINATORY PRACTICE
That’s exactly what we meant with offensive. The price of the hotel depends on your location & your IP address. For example, Indians pay more for a hotel in the US than any European country does. And it’s only because it’s statistically known that travelers from there splash less during the vacation itself (hotel restaurants, souvenirs, SPAs, etc.). OTAs have to cover the loss, right?
Here’s an example of people in the US paying less than Brazilians:
Price when connected to the US:
The same dates, hotel & room when connected to Brazil:
Without being able to connect to all the possible IP addresses out there, you can never be sure that you’re getting the cheapest rate unless you find a way to hack it.
You can use RatePunk Browser Extension for FREE to solve this issue! RatePunk will notify you which country offers the cheapest rates!
#2 PRICE INCREASE AFTER THE 2ND VISIT
This one has been known for longer - if you keep on searching for the same flights/hotels from the same device, the price gets higher. However, the solution often provided (to browse with the incognito mode on) is more like a placebo effect. Numerous studies by travel aggregators have shown there is no variance in pricing when you use incognito mode. And typically, when you abandon your cart (which is tracked by cookies), businesses discount prices to get you to complete your purchase, not raise them higher.
#3 ANOTHER OTA - ANOTHER HOTEL PRICE
There are countless booking websites out there: savings can jump up to 50% just by comparing different suppliers for the same room. You think you found a great price on Agoda? How can you be sure that it doesn’t cost $50 less on Hotels.com (or any other provider)? The thing is: you can’t without checking them all.
Let’s do an experiment. Hotel in the Maldives. We checked as many OTAs as possible & after an hour or so, got this price contrast (saved more than $4500 only because we chose to book through another booking website):
Price on Booking.com. For one week, the full stay is $8026.
Price on Agoda. All the same. One week, the full stay is $498 x 7 = $3486 (!)
#4 THE HUGE COMMISSIONS
The fact that OTAs have commissions is no secret. However, the fact that the commissions are that huge and keep growing is a bit disturbing. Booking has a commission that goes up to 30% (!) of the initial hotel price, and that’s simply not fair. Moreover, according to our latest data, Booking offers the lowest price in only 7% of the cases. Even with these commissions & these 7%, it’s still the #1 booking website worldwide.
What do you do?
First, you stop using Booking & other huge OTAs, as much of a habit as that would be. Second, you turn to direct hotel websites and wholesalers.
Don’t say we’re bragging once again, but RatePunk offers you retail prices. For free. The users of our browser extension & app get access to secret rates that we get from wholesalers.
#5 ILLUSIONARY LOYALTY
Most OTAs have their loyalty programs: “your genius level is 3rd, so you’ll always get better prices now”. Plot twist: it’s a scam. For example, even Genius 3 members on Booking sometimes pay much more than it would cost on another provider. Don’t be loyal - booking websites can never guarantee that the price will always be lower than on 1000 of other OTAs.
Relying on our last example: do you really think that by being the most loyal Booking.com customer, you could have a discount of more than $4500? That would just be naive.
ANOTHER EXAMPLE: Genius 2 comes with 15% OFF the usual hotel rates. €2,503 for a week’s stay at a 5-star resort with a 15% discount seems great!
But then, if we open Booking on another computer & without signing in, the price is… THE SAME.
Wouldn't call that an advantage of being loyal to booking, would you?
#6 TAXES & FEES
It’s no secret that various taxes & fees are included in the price of your stay. That itself is not a problem. However, the fact that the whole price (with taxes included) is not always shown can be called one. Expedia, as an example, shows prices without taxes, and that’s why they seem lower than on competitors' websites. If some taxes are up to a few bucks, resort fees are often incredibly high - Las Vegas hotels can cost $19 and turn into $49 after including them.
#7 RANDOM DISCOUNT SYSTEM ON DIFFERENT DEVICES
Okay, so travelers can book hotels on Booking.com in 3 ways:
- On their computers (desktop version).
- On their phones (going through the website).
- On the app (after installing it).
And to their surprise, the price IS DIFFERENT ON ALL OF THEM because each applies different discounts. So, you can book your wanted hotel on your desktop and later see that you could have saved a few hundred bucks just by booking it on mobile. Do OTAs warn travelers about that in any way? Of course, they don’t.
We took one hotel & checked the pricing offered by Booking.com in 3 ways: on the desktop, through the mobile website & on their app. We found out the price without commissions, added 20%, which Booking most often applies, and checked what discounts are activated when booking in different ways. Here are the results in a table:
#8 RANDOM PRICE CHANGES
The pricing algorithms that OTAs use are super advanced and random: the hotel price you see changes a million times before reaching your eyesight and will change a few more times after you leave the website. That keeps you from scoring a good deal because how can you catch it at its lowest? Without tracking the hotel rate before booking & after it, it’s impossible.
However, there’s a way to fix it now. RatePunk has 2 automatic features that do that for you:
- Price tracking checks these changes before you book it. It informs you via email every time the price drops.
- Rebooking does that after you book a hotel with free cancellation. If there’s a price drop for the hotel you booked, RatePunk sends a notification so you can cancel your reservation and rebook the same hotel at a lower rate.
#7 MAJOR DUOPOLY
For the last decade, only two names dominated the travel industry: Booking.com and Expedia. These companies own most of the well-known OTAs mistakenly held as independent, making you feel like you have plenty of options to choose from. And actually, you do. You can book a hotel from any of these websites and choose the best price that meets your financial needs. The question is: do you have the time for it?
Checking a bunch of OTAs, clicking a million links & wasting your time at a computer screen instead of just stepping into the mood for your vacation. You’ll most probably find the cheaper option (not the cheapest because you can never check them all), but when that much time is spent, the saving will lose its point in the end.
Save the biggest sum possible by spending only a few seconds on it: RatePunk is a 100% free & unique tool that guarantees you the lowest possible price on any stay you’re booking. And makes sure you don’t spend 10 hours doing it manually. This browser extension finds a roundabout for all of the tricks named above that OTAs use. It checks all the booking websites' algorithms and compares the prices with different VPNs, so you don’t splash only because you’re booking from a location that the OTA is not a fan of & doesn’t hide taxes.
You’ll be 100% sure that you’re never overpaying & saving loads of time. The best part? It’s completely FREE. Do yourself and your wallet a favor and get RatePunk 👇