Hotels Face Challenge of Attracting International Customers to Latin America
What: Carlos Orta, VP of corporate affairs at Carnival Corporation, Montserrat Santaella, international promotion manager at Grupo Posadas, and José Luis Carrete, chief digital officer at Hoteles City Express, talked about their marketing challenges and their relationship with OTAs during #PortadaLat in Miami.
Why it Matters: Latin American travel brands are profiting from the opportunity to bring international customers to their hotels.
Managers in the hotel industry are working hard on getting customers to Mexico and Latin America. Grupo Posada, for example, is focusing on emphasizing the country’s natural beauty, and making sure that it connects each customer with their right brand.
Carnival is making an effort to reinforce their loyalty programs and attract people who have never been on a cruise. According to Carlos Orta, VP of corporate affairs at Carnival Corporation, once someone goes on a cruise ship, the chance that they come back is huge.
On the other hand, City Express is trying to bring international customers to their business-focused hotels. Until now, they have been doing great in the national market, but now it’s time to grow and go global. They have the infrastructure and are located in the right places, close to industrial regions; the challenge they face now is to have a team ready to welcome customers from around the world.
Each of these brands has its own strategy to attract the U.S. and international traveler, but what they all have in common is their connection with OTAs and online booking. According to Orta, 50% of global hotel bookings are done online, and, according to José Luis Carrete, chief digital officer at Hoteles City Express, in most regions worldwide, almost 50% of reservations are done through OTAs (andin the case of City Express 76% comes from OTAs), while direct online sales by hotels in Mexico and LatAm account for only 3-8% of reservations.
On the bright side, all three agreed that OTAs are doing an amazing job of bringing customers to their brands. But, the problem is that most of these OTAs are getting a big commission. “It is a very expensive way of selling,” said Orta.
“You can not work against the OTAs, you need to work together with them if you want to reach every segment,” said Montserrat Santaella, international promotion manager at Grupo Posadas.
The truth is, explained Carrete, OTAs have extraordinary and very advanced digital structures that hotels are just starting to develop. “We didn’t have a chief digital officer until 6 months ago,” Caret confirmed. Hotel companies are getting there, but there obtaining the reach that they have would be impossible if it weren't for online and offline travel agencies.