A Shift in Price Perception

An analysis by Rick Garlick, Ph.D., Consulting Partner, BVA BDRC and HSMAI Foundation Board Member, indicates a significant shift in consumer behavior in the UK hotel industry. Findings from BVA BDRC’s Hotel Guest Survey (HGS) suggest that travelers increasingly view hotel-branded websites as the most reliable source for the best rates, a position previously dominated by online travel agencies (OTAs).

Key Points from the BVA BDRC Survey

The survey, which monitors hotel brand performance and consumer behavior across 25 countries, reveals that this trend is especially pronounced in the UK. As of the first half of 2024, 32% of UK guests believed that hotel websites offered the best rates, up from 28% in 2018. Conversely, faith in OTAs as the lowest-price option fell from 41% to 36% over the same period.

This shift in perception applies to both business and leisure travelers, though generational differences persist. Gen X travelers still prefer OTAs at 45%, as opposed to 26% for hotel websites, likely due to their early digital travel habits formed during the rise of third-party booking platforms.

Comparison with US Market

Whether this trend is reflected in U.S. consumer sentiment remains unclear. Data from 2021 showed OTAs still ahead in rate perception at 47% vs. 39% for hotel websites. However, hotel brands are increasing their push for direct booking through price guarantees, loyalty rewards, and exclusive member deals, which may be cutting into OTA dominance in the U.S.

The Evolution of OTAs

OTAs are also adapting. Previously focused on drawing price-sensitive travelers, platforms like Expedia are now reorienting towards convenience, personalization, and discovery. Leveraging AI-powered tools, they offer tailored recommendations, interpret vague or flexible travel searches, optimize itineraries, and synthesize post-trip reviews, enhancing the planning experience rather than simply competing on price.

This evolution may be leading to a new segmentation of traveler behavior: loyal brand followers who seek the best rates through direct booking, and open-minded explorers who value variety, inspiration, and digital convenience over strict price competition. The shift in price perception suggests that many travelers now consider value to be about more than just cost, but also the overall booking and travel experience. Understanding this shift will be crucial for both hotel brands and OTAs as they fine-tune their strategies in an increasingly segmented market.