OTAs Are a Powerful Part of the Equation
For select-service hotel owners, Online Travel Agencies like Booking.com, Expedia, and Hotels.com are essential distribution partners. They deliver massive reach, connect your property with travelers across the globe, and fill rooms during periods when direct demand alone may not be enough. For many hotels, OTAs represent the single largest source of bookings — and that's not inherently a bad thing.
What matters is understanding the economics of each channel so you can make informed decisions about where to invest and how to optimize your overall revenue strategy.
The average OTA commission rate in 2026 sits between 15% and 25% per booking, depending on the platform, your property's location, and the program tier you participate in. For a select-service hotel charging $130 per night, that means $19.50 to $32.50 per room night goes to the OTA. That's the cost of access to their audience — and for many bookings, it's well worth it.
The Case for Channel Diversification
The smartest hotel operators don't think in terms of "OTA vs. direct." They think in terms of channel mix optimization — ensuring that every booking comes through the most cost-effective channel for that particular guest and that particular moment.
Consider a 90-room select-service hotel running at 68% occupancy. That's roughly 1,830 room nights per month. If the vast majority of those bookings come through a single channel — whether that's OTAs, direct, or brand.com — the property is exposed to risk. Algorithm changes, commission increases, or shifts in traveler behavior on any one platform can have an outsized impact on revenue.
A diversified channel mix — one that includes strong OTA partnerships alongside active direct booking campaigns — creates resilience. When one channel softens, others can pick up the slack.
OTAs Do Things Direct Channels Can't
It's important to recognize what OTAs bring to the table beyond just bookings:
Global reach and discovery. OTAs invest billions in marketing to attract travelers worldwide. For a select-service hotel in a secondary market, that exposure would be impossible to replicate independently. Many guests discover your property for the first time through an OTA — and some of those guests become direct bookers on future stays.
Review volume and social proof. OTA reviews are among the most trusted sources of information for travelers. A strong review profile on Booking.com or Expedia builds credibility that benefits your property across all channels, including direct.
Revenue during soft demand. During off-peak periods, OTAs can deliver volume that direct channels alone may not generate. Their promotional tools — flash sales, mobile-only deals, genius programs — can help fill rooms when occupancy dips.
Adding Direct Channels to the Mix
Where the opportunity lies for most select-service hotels is in adding direct booking channels to complement their existing OTA strategy — not replacing it. When a traveler is already searching for your specific property, giving them the option to book direct (at a competitive rate) is simply good business. You capture the booking at a lower cost of acquisition, and you build a direct relationship with the guest.
Effective strategies include:
Metasearch advertising through Google Hotel Ads places your direct rate alongside OTA prices at the moment a traveler is comparing options. This doesn't take away from OTA visibility — it adds another option for the traveler and gives your property a chance to capture the booking directly.
Paid search campaigns ensure your property appears prominently when travelers search for hotels in your market. These campaigns work alongside OTA listings, not against them — capturing demand that might otherwise go to a competitor.
Strategic OTA investment means actively managing your OTA presence — optimizing listings, participating in the right promotional programs, and investing in OTA advertising tools like Booking.com Sponsored Ads when the ROI makes sense.
The StayIQ Approach
At StayIQ, we manage both OTA and direct channels for select-service hotels. Our philosophy is simple: every channel has a role to play, and the goal is to optimize the entire mix — not to pit one channel against another.
Our clients typically see 10:1 to 26:1 ROAS on their digital marketing investment across all channels. We help hotels invest strategically in OTA programs that deliver strong returns, while simultaneously building direct booking capabilities that improve overall margins.
The best-performing hotels in 2026 aren't the ones that avoid OTAs or avoid direct. They're the ones that invest intelligently across both.