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6 Nov 2018

Tourism

Thai tourism and hospitality operators increasingly rely on OTAs with OTA fees expected to reach THB29 billion-34 billion (Current Issue No.2934)

            At present, the fast-paced business world is fuelled largely by digital disruption. The tourism and hospitality business is one of the industries that has experienced a rapid evolution in the past decade, with Online Travel Agencies (OTAs) emerging to become a force to be reckoned with. The OTA business is driven by key global players which are poised to increase their presence and attach greater importance to the Asian region. The evidence is the value of merger and acquisition deals by the two OTA juggernauts in the Asian region; it represents 41 percent of their global M&As worth THB440 billion.

         In addition, the more powerful presence of OTAs has not only provided hospitality operators with an essential tool to facilitate their business but also posed a challenge to them. OTAs do not only impact international travel and hotel companies but also local operators. KResearch estimates that OTA fees generated from inbound foreign travellers to Thailand in 2018 could reach THB29 billion-34 billion or account for 5.5 percent of the total accommodation revenues generated from inbound travellers in the kingdom.

           ​Business operators and travelers tend to increase the use of OTA service because it is an effective channel for sales and marketing and conveniently accessible to holidaymakers. Therefore, Thai hospitality operators should consider OTA together with other sales channels to reach out to more customers in accordance with their cost structure or strategic model.



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