Opportunities and Challenges Brought by Online Travel Agency Platforms to Economy Hotels

Faculty of Hotel and Tourism Management, Macau University of Science and Technology, Macau, China

^* Corresponding author: 1220025519@student.must.edu.mo

Abstract

Online Travel Agency platforms have attracted a large number of consumers through their unique marketing methods and have gradually gained control over hotel market traffic. This paper uses the Home Inn Hotel Group as a case study to systematically analyze the dual impact of Online Travel Agency platforms on China’s budget hotel sector using Porter’s Five Forces model. Research shows that while Online Travel Agency platforms help hotels increase revenue, they charge high commissions and attempt to monopolize the hotel customer market, leading to intense competition between hotels and Online Travel Agency platforms. Due to the high commissions charged by Online Travevl Agency platforms, the profit margins of budget hotels have been severely reduced. To help budget hotels in China survive and develop better, this paper provides constructive suggestions based on the analysis results, including strengthening the multi-channel construction system, optimizing the cooperation model with Online Travel Agency platforms, and offering differentiated services. The study provides practical suggestions for the “de-OTA” strategy of Chinese economy hotels, but it also has limitations such as the lack of relevant data analysis. In the future, relevant data can be updated, and further research can be conducted on the effectiveness of multi-channel marketing strategies for Chinese economy hotels in “de-OTA”.