HOTREC Online Distribution Channels Analysis 2022

European Hotel Distribution Study 2022

Reference Year 2021 Results

Executive Summary

The Study

HOTREC, the European umbrella association of hotels, restaurants and cafes, conducted its biennial study of the European hotel distribution market between January and April 2022 in cooperation with the University of Applied Sciences and Arts Western Switzerland Valais (HES SO Valais Wallis). This is the fifth study since the series began in 2014.
The aim of the study is to track the development of distribution channels in the European hotel industry, with a particular focus on the role of online travel agencies (OTAs).
The results for the 2021 (pandemic) reference year are based on observations from approximately 3,900 hotels across Europe.

Developments in the distribution market between 2013 and 2021

HOTREC's distribution study shows that between 2013 and 2021, the market share of OTAs (Online Travel Agencies) in the European hotel sector increased steadily, from 19.7% in 2013 to 29.2% in 2019 (weighted results including data from hotel chains).
At the same time, the share of direct bookings across Europe fell by more than 10 points, from 57.6% in 2013 to 47% in 2019.
The 2021 results show that hotels' dependence on OTAs remained at almost the same level as in 2019 during the pandemic, while direct bookings increased significantly. According to our results, the share of OTAs was 28.8% in 2021, while direct bookings rose to 55.2% (an 8-point increase compared to 2019).

Who dominates the Online Travel Agency market?

The 3 main players in the OTA market remain Booking Holding, Expedia Group and, to a lesser extent, HRS, with a combined market share of 90.4%.
Booking Holding is by far the most influential player, with a 71.2% share of the OTA market (compared to 68.4% in 2019). Booking's dominance has increased by more than 11 percent over the past 8 years, rising from 60.0% in 2013 to 71.2% in 2021.
Expedia was unable to maintain the market share it had achieved between 2015 and 2019 during the pandemic. Its relative market share fell from 16.3% in 2019 to 12.5% in 2021. This decline can be explained by Expedia's market structure, which is predominantly present in luxury and business hotels in large cities that were heavily affected during the pandemic.
HRS saw a steady decline in its market share, from 16.6% in 2013 to 6.7% in 2021.

The OTA-hotel relationship

In some aspects of their relationships with OTAs, hotels (55%) feel pressure to accept platform terms and conditions (for example regarding cancellation policies and special discounts) that they would not voluntarily accept. As is known, the higher the volume of overnight stays generated at a hotel by an OTA, the greater the pressure felt.
For approximately 71% of respondents, the standard commission rate remained the same, but for a significant proportion of hotels (26%) the commission rate increased.
About two-thirds of hotels use Booking's or Expedia's online payment options, and roughly one in every two hotels takes advantage of the various opportunities offered by OTAs to effectively improve their ranking.

Distribution Technology

Compared to 2013, the proportion of hotels managing prices and availability manually fell from 56% to 37% in 2021, and the use of channel managers increased slightly from 39% to 47% but remained at a relatively modest level.
In 2013, about half of hotels were unaware of the options for integration with travel metasearch engines. In 2021, approximately 80% of respondents are aware of this distribution channel, which is used by 41% of hotels.
In 2013, TripAdvisor was the dominant metasearch platform in the market, with a 71% usage share. In 2021, Hotel Ads by Google is the market leader (73%), followed by TripAdvisor (57%) and Trivago (44%).