--- title: "Why Global OTAs Are Losing Their Profit Margins" description: "We explore the expansion of hotel loyalty programs driving direct bookings and Google Hotels' continued rise in influence." published: 2024-08-27T00:00:00+00:00 author: "ONDA 편집팀" category: "Weekly ON" image: "https://zqcfqfqgiyckyhazcfrk.supabase.co/storage/v1/object/public/blog-images/webflow/6316f3f75130788ec2d762dd/66cd620fb1c2761c7ee3a930_WeeklyON_vol135_webflow_cover_1200px.png" canonical: https://global.onda.me/en/blog?slug=vol-135 locale: en --- # Why Global OTAs Are Losing Their Profit Margins ⚠️ All rights reserved. Cite this piece as 'ONDA (온다)' when quoting. --- #### **In this issue** 🏨 Why global OTAs are losing their profit margins 💡 Where are travelers actually using accommodation discount coupons? ⌨️ #ChuseokHoliday #InboundTourism #PetFriendlyVillas #PremiumPackages #HoneymoonTrends --- **🏠 Industry Deep Dive** ### **Why Global OTAs Are Losing Their Profit Margins** > "The easy money from online payment customers — that window has definitely shrunk." (Peter Kern, former Expedia CEO, [\[Skift\] State of Travel 2024](https://research.skift.com/report/state-of-travel-2024/)) > "There are many players in the market. Not just OTAs but metasearch companies, hotel companies, chain companies — we still think it's very competitive." (Booking.com CFO, [Q4 2022 Earnings Call](https://skift.com/2024/08/15/marketing-wars-booking-vs-expedia-who-spends-smarter/)) Top global OTA executives are openly discussing eroding profitability. Several factors are at play, but two stand out: **more travelers booking direct with hotels**, and **Google Hotels' relentless growth in metasearch**. This week, we're looking at how **hotel loyalty programs fuel direct bookings** and why **Google Hotels keeps gaining ground**. Think about how you choose an airline. First, you compare schedules and prices. Then you check which one earns miles on your preferred program. Major hotel chains are making their loyalty programs work the same way. Membership exploded during the pandemic: Marriott grew from 136 million members in 2019 to 196 million — up over 40%. Hilton jumped from 100 million to 180 million. ![Source: Skift, State of Travel 2024](https://zqcfqfqgiyckyhazcfrk.supabase.co/storage/v1/object/public/blog-images/webflow/6316f3f75130788ec2d762dd/66c826986f961016c60447cf_66c825e9748cb8517f093113_EA_B8_80_EB_A1_9C_EB_B2_8C_20_ED_98_B8_ED_85_94_20_EC_B2_B4_EC_9D_B8_EC_9D_98_20_EB_A1_9C_EC_97_B4_ED_8B_B0_20_ED_94_84_EB_A1_9C_EA_B7_B8_EB_9E_A8_20_EA_B8_89_EC_84_B1_EC_9E_A5.jpeg) **Loyalty programs and brand power drive direct bookings.** Marriott's direct online bookings rose from 33% of total bookings in 2019 to 38% by Q2 2022. So where are these direct bookings coming from? What kind of hotel staycation packages are emerging? And why are new "O-cation" concepts gaining traction? ### 👉[****](https://www.onda.me/blog/royeolti-peurogeuraem-hwagdae-jigjeob-yeyag-jeungga?utm_source=stibee&utm_medium=email&utm_campaign=newsletter-2024_08_27) --- **💡 Hospitality Trends** ### **Where Are Travelers Actually Using Accommodation Discount Coupons?** [**👉\[Full story\]**](https://www.sukbakmagazine.com/news/articleView.html?idxno=61644) The "Korea Stay Sale Festa" runs August 27 to September 29, distributing 200,000 discount coupons for non-metropolitan accommodations. **With up to nine consecutive days off over Chuseok, the government expects a major boost to domestic travel.** How effective were past campaigns? In the first half of 2024, three rounds of the festa distributed 450,000 coupons. Results: **₩192.4 billion in tourism spending and approximately 1.07 million regional visitors.** Over half the coupons went to motels. In June's round, **52% were used at motels, 28% at hotels, and 20% at pensions**. Regional patterns varied. Gangwon showed higher shares for hotels (41%) and pensions (28%). Jeju and Busan skewed heavily hotel — 60% and 37% respectively. ### [👉<**2023 Stay Sale Festa Data Summary.zip**\>](https://www.onda.me/blog/2023-sugsepe-deiteo-yoyag-zip?utm_source=stibee&utm_medium=email&utm_campaign=newsletter-2024_08_27) --- **⌨️ In the News** **1️⃣ Chuseok holiday travel** [👉\[Full story\]](https://www.edaily.co.kr/News/Read?newsId=01758086638988960&mediaCodeNo=257) **TL;DR:** 66.3% of Koreans plan domestic trips during Chuseok **The story:** Over six in ten travelers plan to burn vacation days for a longer Chuseok break — mostly to extend their trips. **Destinations?** Domestic wins over outbound (66.3%). Gangwon leads at 37%, followed by Jeju and Gyeongnam at 11% each. **2️⃣ Inbound tourist spending** [👉\[Full story\]](https://www.dnews.co.kr/uhtml/view.jsp?idxno=202408220953549140049) **TL;DR:** Foreign visitors spending 19% less year-over-year **The story:** First-half 2024 per-visitor spending hit ₩2.5 million ($1,867.90), down from ₩3.09 million ($2,311.60) last year — a 19% drop. **Why?** Purchasing power — including Chinese tourists — is down. Travel preferences are shifting from department stores and duty-free to restaurants and pop-ups — from shopping tourism to food tourism. **3️⃣ Pet-friendly private villas** [👉\[Full story\]](https://www.mk.co.kr/news/culture/11098073) **TL;DR:** Pet-dedicated private pensions dominate summer travel **The story:** 93.6% of summer travelers with pets chose private villas with pet facilities. Average price: ₩320,000 — comparable to luxury city hotels. **How they book:** Korea Tourism Organization surveys show pet owners prioritize pet-travel-specialized booking platforms. **4️⃣ Premium packages** [👉\[Full story\]](https://www.hankyung.com/article/202408166813g) **TL;DR:** Ultra-luxury packages (₩millions) seeing strong demand **The story:** Travel agencies are expanding ultra-premium products priced in the millions or tens of millions of won. Premium now accounts for a growing share of total package bookings. **Next?** Major agencies are launching dedicated premium brands and curated showcases — betting on higher margins and ticket sizes. **5️⃣ Honeymoon trends** [👉\[Full story\]](https://www.traveltimes.co.kr/news/articleView.html?idxno=409371) **TL;DR:** Accommodation is the #1 priority for Korean honeymooners **The story:** Koreans planning honeymoons rank accommodation highest. 41% say luxury lodging is non-negotiable, even on a tight budget. **Planning:** Couples start planning an average of 6.7 months out. Most prefer trips of 1–2 weeks, single-country itineraries. ---