How Local hotels are increasing revenue
by 30% by relying less on any OTAs
The Phenomenon
Yes, we’re not kidding. Nowadays hotels in Malta are increasing profits month after month using Lucanda and not relying on any OTA. But how? And what’s Lucanda?
First, say hello to Michael.
He’s a customer that has booked a hotel room with you in Malta for him and his girlfriend 5 minutes ago. Sounds good, right? In fact, it doesn’t.
Because he’s done it through Booking.com. Yes, one of the many online travel agencies (OTAs) that take 15-20% of commission every time a client books a room.
But Michael is not aware of this. He is just booking his holiday. The OTAs offer a clear, specific and easy way of booking despite harming hotels month after month.
So what can we do? Is there a solution? (Hint: of course there is).
First let’s be clear about what we really want.
What we really want — more than anything — is a sense of control. We want to know that our business results (and our income) are stable, predictable, and scalable. That next month will be better than this month. That there’s opportunity to increase the value we contribute to the world, expand our horizons, our relationships, and our income.
But that’s not the reality
We want control, but we get confusion
Let’s have a look at the Maltese hotel distribution landscape. What do we find?
Nowadays, it’s impossible for anyone to understand what’s really happening. With many players accessing and exiting the Maltese market, selling the same hotel room inventory through so many channels and different rates of commission, it’s confusing what it’s yours and what’s not.
Between all the business-to-customer (b2c) and business-to-business (b2b) we end up with something like this:
What can we conclude from here? While good for consumers, it is making it increasingly hard for hoteliers to keep tabs on all the distribution channels that are selling their rooms and at what rates.
Hence good for Michael, but bad for hotels.
Zak Borg,
Partner
Fact: Up at 4:45am 💪
It’s not all bad. Direct bookings are going up
In the year 2000 hotels distribution was predominantly people booking directly to the hotel and those bookings represented half to three quarters of their sales.
But, where the money is, the competitors go. Microsoft founded Expedia and a start-up called Booking.com started. Now, known as the OTA duopoly, they take an enormous piece of the market.
To fight against this, hotels started to launch campaigns, loyalty programs and discounts to their members. Nowadays, data shows that hotels’ direct bookings are gaining market share during the pandemic.
As we can see in this graphic.
Expanding a loyal customer base
The hotel website’s UX provides direct booking guests with their first impression of the hotel. Most hoteliers offer loyalty programs so as to build a high-value customer base. Loyalty programs may include being greeted with welcome drinks, setting your own check-in and check-out time rather than having to accommodate to a fixed time, and earning loyalty points per stay which may then be redeemed for special offers.
The problem: some hotels like Marriott are getting great results via direct, but that’s not necessarily representative of the wider industry. So how can we get the same results as those hotels via direct?
Lucanda is here
This is where Lucanda comes in. Replacing the OTAs and helping hotels increase their revenue through direct bookings.
Since the comeback, the LUCANDA. booking engine has averaged 150 EUR for a room. That means 150,000 EUR per 1000 rooms in two weeks. If we take an average of 150 rooms per hotel that means a staggering 90,000 EUR per month.
Share this insight:
Find out how we will
make you do better
Lucanda is part of the ANCHOVY. PLC Group and is a 
