Booking engines for hotels: An introduction to direct bookings

In the hospitality industry, the question boils down to this: should you sell directly to your guests, or should you use an intermediary that takes a cut?

Now, there’s much to be said about spreading your eggs across many baskets. Indirect distribution channels, such as online travel agents (OTAs), are part of most sensible marketing mixes, and the reduced profit is offset by increased reach.

But, to stay profitable, you need strong direct efforts too. In today’s digital-first world, long gone are the days when you can rely on walk-ins and over-the-phone bookings. Most guests book online, and a good website is your first step toward commission-free bookings.

But what converts a website visitor into a confirmed guest?

This is where booking engines come in, and in this blog post, we’ll explain what they are, how they work, and why they’re a must-have for any hotelier aiming to boost efficiency, improve guest experiences, and maximize profits.

What is a booking engine for hotels?

Available through numerous suppliers, hotel booking engines (or booking modules) are software applications that allow your guests to make reservations directly on your hotel’s website (a.k.a. Brand.com), mobile app and social media platforms.

As today’s guests are looking for certainty and convenience when booking, they are no longer satisfied with a contact form on your website. Guiding your guests on every step to the check-in desk, booking engines serve as the digital gateway for potential guests to view room availability, assess pricing and confirm their bookings in real time, eliminating the need for intermediaries such as OTAs.

Modern booking engines are equipped with user-friendly interfaces, multi-language support and secure payment processing. Designed to simplify the booking process for travelers, they provide you as a hotelier with powerful tools to manage your reservations efficiently and effectively.

Illustrating their importance for successful hotels, three of their core benefits can be summarized as:

• Boosting efficiency: booking engines automate much of the reservation process, reducing the workload on your front-desk staff through automation while simultaneously eliminating the risk of overbooking. By streamlining these operations, you can focus more on delivering exceptional service to your guests.

• Improving the guest experience: your guests expect convenience and efficiency when making travel arrangements. A well-designed booking engine ensures a seamless and hassle-free booking experience, with features such as instant confirmation, personalized offers and the ability to book add-ons like spa treatments or late checkouts.

• Increased commission-free bookings and revenue: direct bookings through your hotel’s website reduce reliance on OTAs, which typically charge hefty commission fees that impact your bottom line. Booking engines can also integrate with marketing tools to offer dynamic pricing, promotions and upselling opportunities, all of which contribute to higher revenue. Research shows that guests spend significantly more on their stays when booking directly.

Many booking engines also provide robust analytics, enabling revenue managers and distribution managers to understand booking trends, customer preferences and peak demand periods. These insights are invaluable for tailoring marketing strategies and optimizing your revenue.

How do online booking engines work?

A good booking engine operates as an integral part of your hotel’s digital ecosystem, interacting with various systems to deliver a seamless experience for both guests and staff.

Here’s how it typically works:

Integration with your hotel’s website

Supported by an application programming interface, or API, your booking engine is embedded into your hotel’s website or mobile app, often through a widget or dedicated page.

Guests can search for available rooms, compare rates and make bookings without ever leaving your site. In other words, their experience is confined to your website, even though the data they search, view and submit is interacting with your booking engine and other systems.

Channel management

Advanced booking engines also integrate with channel managers, enabling your hotel to distribute room availability across multiple OTAs and travel platforms while maintaining accuracy and consistency in pricing and inventory in real time.

Connection to your property management system (PMS)

To ensure real-time accuracy, your booking engine integrates with your hotel’s PMS. This connection synchronizes room inventory, availability and pricing across all sales channels, minimizing the risk of overbookings or pricing errors.

Secure payment processing

Most booking engines – and all those we’d recommend – include built-in payment gateways that support various payment methods, ensuring a smooth and secure transaction process for guests.

Marketing and upselling tools

Booking engines can be configured to display personalized promotions and special offers, recommend upgrades or offer package deals. These features help drive additional revenue while enhancing the guest experience.

5 Must-have booking engine features

Every hotel is unique - even those within a chain - so your software needs will vary too. While your ideal booking engine will depend on your specific goals, there are five essential features no hotelier should overlook. These are the non-negotiables for any booking engine worth considering.

1. Data collection

A robust booking engine should provide comprehensive data collection capabilities, capturing customer details, booking preferences and buying behaviors. This data is invaluable for hotels, enabling you to refine your marketing strategies, personalize guest experiences and anticipate customer needs.

By leveraging analytics from the collected data, you can optimize pricing, track booking trends and measure the effectiveness of your promotional campaigns. A data-driven approach not only improves operational efficiency but also helps drive revenue growth and customer satisfaction.

2. Payment processing

Seamless payment processing is a critical piece of functionality for any booking engine. It should support multiple payment methods, including credit cards, digital wallets and regional options, ensuring convenience for global customers. Security is paramount; a booking engine must comply with the Payment Card Industry Data Security Standard (PCI DSS) and offer encryption to protect sensitive data.

A smooth payment experience builds customer trust, minimizes booking abandonment and streamlines the revenue flow for hotels, making it a cornerstone of successful online bookings.

3. Integration

Integration with other systems, such as your PMS, channel managers, customer relationship management (CRM) tools, central reservation systems (CRS) and data insight tools like rate shoppers, is essential for a booking engine. This feature ensures that your hotel room availability, pricing and guest details are consistently updated across platforms.

By facilitating real-time synchronization, integration eliminates double bookings, streamlines operations and provides a seamless experience for both guests and your staff. Efficient integration boosts productivity and enables a cohesive, technology-driven hotel management ecosystem.

4. Add-ons

A versatile booking engine should allow your guests to personalize their stay by offering add-ons, such as spa packages, airport transfers or dining reservations. These options enhance the user experience while providing your hotel with additional revenue opportunities.

By enabling upselling and cross-selling during the booking process, you can increase your average revenue per guest (ARPG) and other metrics, such as occupancy, average daily rate (ADR) and revenue per available room (RevPAR). Add-ons also reflect your hotel's commitment to convenience and customization, making it an appealing choice for modern travelers.

5. Support

Exceptional support is a must-have feature in a booking engine, ensuring uninterrupted service for both hotels and guests. This includes 24/7 technical assistance, multilingual customer support and comprehensive training resources.

A reliable support system minimizes downtime, addresses issues promptly, and provides peace of mind to users. For hotels, responsive support ensures smooth operations, while your guests benefit from a hassle-free booking experience. Strong support builds confidence in the platform and enhances its overall value.

What is the best hotel booking engine?

There are a lot of booking engines on the market, many of which would serve you well, so we can’t do justice to all of them. But here are five that are solidly reliable:

• SiteMinder: with particular strengths in managing multiple booking channels with ease, it’s designed for use at all sizes of hotel and is popular with some of the big hotel brands.

• Cloudbeds: offering great multilingual booking options to draw in travelers from around the world, it caters for hotels, B&Bs, hostels and vacation rentals.

• Paraty Tech (Spanish): boosting your hotel's online visibility with aplomb, it’s particularly popular with hotel chains.

• Blastness (Italian): adept at boosting your revenue through dynamic pricing strategies, it’s slightly more niche than the booking engines above but is highly recommended by its users.

• Bookassist: helping you increase your hotel's revenue through optimized pricing, it’s very highly rated by boutiques but caters to all types of property, from independent hotels upwards.

While most booking engines, including all those we list above, charge users a subscription, some booking engines are free to use. They don’t generally offer as many features, so their business models are likely to rely on monetizing data in some way. But if you do your due diligence - read a review or two on the likes of Trustpilot – they’re worth considering, at least in the short term, if you’re operating on a tight budget.

Don’t forget about other booking channels

As we’ve said from the outset, direct bookings are only one basket for your eggs; don’t forget the importance of online travel agencies, particularly when demand is low and you need to increase your marketing outreach on a budget.

Plus, more than 50% of travelers visit your hotel website after having discovered your property on a big OTA. So, in a way, OTAs can help you drive website visitors and, thus, direct bookings. It’s all about visibility.

But it’s a delicate balancing act, calling for nuanced strategy and the careful use of different distribution channels – and not just OTAs; you should consider metasearch, GDS and wholesale too.

How can you achieve this?

As we discussed in the section on how booking engines work, a big part of the answer lies in channel managers. Keeping all online channels in sync and ensuring that your hotel's inventory and room rates are accurate and up-to-date across all platforms, a good channel manager will help you manage (and increase) bookings no matter which channel they come from – so they help with indirect and direct revenue alike.

Learn how a channel manager helps travelers discover your hotel

Channel managers are vital solutions for hoteliers.

Allowing hotels to manage their listings across multiple distribution channels all from a single, centralized platform, they put everything in one place, meaning you can make channel management decisions quickly and effectively, based on a full view of your distribution landscape.

Lighthouse’s industry-leading Channel Manager distinguishes itself from other providers by allowing you to:

• Optimize your distribution with dynamic price recommendations sent to all of your connected channels

• Maximize visibility and revenue by connecting to 200+ online channels

• Save time by automating pricing, promotions and syncing of availability

• Get more commission-free direct bookings through your website

Together, a booking engine and channel manager create a powerful combination, ensuring your hotel thrives in today’s competitive digital landscape. Learn more about how you can use a channel manager to elevate your strategy here.