How Boutique Hotels can reduce dependency on Online Travel Agencies, through the use of Social Media

Abstract

This thesis will look into one growing trend that boutique hotels could embrace to their advantage: increasing the use of social media, to differentiate themselves from OTA’s and ultimately reduce their dependency. According to, Senior Vice President of research for PhoCusWright Inc., Lorraine Sileo in 2015 74% of the online booking for the non-branded hotels were made through OTA’s, and 63% for the chains. This thesis will look into how boutique hotels, of maximum 110 rooms in Denmark, both in the countryside and city, can reduce their dependency on OTA’s, and increase buyer value. It will therefore take an exploratory approach, to examine how hotels can use social media as an effective channel to reduce dependency on OTA’s. It is argued that in the hospitality industry, ROI should be measured through experience and engagement. This is significant for boutique hotels because they are typically focusing on creating a unique experience and telling a story, thus creating value for the buyer (Anhar, 2001). The story telling proposition could be told through social media to enhance buyer value, in order to attract more direct guests. Today, travelers prefer to participate in the environment. From the findings, it is found that hotels should regard the benefits that come with the use of social media, as it is an opportunity to participate in the online travel community, engage with their guests and attract potential guests. Having a well-established online presence is increasingly important for companies nowadays; therefore hotels should consider that in order to maintain versatile in their innovative practices, as trends in the hospitality industry are ever-changing.