Do direct bookings really cancel less than OTA bookings?

Yes. Cloudbeds reports that 21.8% of OTA bookings are cancelled against 10.6% of direct bookings. That roughly doubles the effective acquisition cost of an OTA reservation on a net-realised basis, because you paid commission on a room that more often never gets occupied.

What is the billboard effect in hotel marketing?

Cloudbeds cites that 50% of guests who find a property on an OTA then search for it directly on Google before booking. Whether you capture that traffic depends on your brand search results and booking engine.

Are Google free booking links enough on their own?

No. Mirai found that for hotels running both, paid links drove 82% of bookings versus 18% from free links, with paid converting 62% higher at about 3.60% against 2.08%. Free links are a floor, not a plan.

What does hotel paid search cost?

WordStream's 2026 benchmark puts travel at a $2.14 average cost per click and $44.70 cost per lead, against an all-industry $5.42 and $66.69. Defending your own brand name is the cheapest revenue in hospitality.

What does marketing that works look like for hospitality? - Tack Media | AI Digital Marketing Agency in Los Angeles

Q: How much commission do OTAs charge hotels?

Cloudbeds puts the range at 15% to 30% and above. Preno reports Booking.com at 10% to 25% averaging around 15%, Expedia at 15% to 30% for independents, Agoda around 15% and Trip.com at 10% to 25%.

Short answerHospitality marketing works when you price every channel by its true net cost. An OTA booking costs 15% to 30% in commission. A direct booking costs whatever you pay search, metasearch and email to win it, which is usually less, and it cancels at roughly half the OTA rate.

The short answer

The short answer Hospitality marketing works when you price every channel by its true net cost. An OTA booking costs 15% to 30% in commission. A direct booking costs whatever you pay search, metasearch and email to win it, which is usually less, and it cancels at roughly half the OTA rate. What actually drives the number Four.

The short answer

Hospitality marketing works when you price every channel by its true net cost. An OTA booking costs 15% to 30% in commission. A direct booking costs whatever you pay search, metasearch and email to win it, which is usually less, and it cancels at roughly half the OTA rate.

What actually drives the number

Four numbers decide whether a hotel’s marketing is working. Occupancy is not one of them.

Commission is your largest single marketing line, and it is invisible. Cloudbeds puts OTA commissions at 15% to 30% and above depending on platform, market and the property’s negotiating position, with niche regional OTAs as low as 4%. Platform by platform, Preno reports Booking.com at 10% to 25% averaging around 15%, Expedia at 15% to 30% for independents and 10% to 15% for chains, Agoda around 15% and Trip.com at 10% to 25%. A 200-room property running 60% of its business through OTAs at 18% is spending more on distribution than most hotels spend on every other marketing activity combined. It just never appears in the marketing budget.

Cancellation rates differ by channel. Cloudbeds reports 21.8% of OTA bookings cancelled against 10.6% of direct bookings. That doubles the effective cost of an OTA booking on a net-realised basis, because you paid to acquire a reservation that half as often survives to arrival.

The billboard effect is real and it is your opening. Cloudbeds cites that 50% of guests who find you on an OTA will then search for you directly on Google before booking. Half your OTA-sourced demand walks past your own front door on the way to paying commission. Whether you capture it depends entirely on what your brand search results, metasearch listings and booking engine look like at that moment.

Search is comparatively cheap in this category. WordStream’s analysis of 13,474 US search campaigns from April 2025 to March 2026 puts travel at a $2.14 average cost per click and $44.70 cost per lead, against an all-industry average of $5.42 and $66.69. Travel also posts one of the highest click-through rates in the study at 9.32%. Paid search on your own name and your own market is not expensive. Commission is.

Metasearch runs on two tracks. Mirai’s analysis of Google Hotels found that for properties running paid campaigns, paid links drove 82% of bookings against 18% from free booking links, with paid converting 62% higher at roughly 3.60% versus 2.08%. Free booking links are not a substitute for bidding. They are the floor you should never be below, and bookings from them grew 154% year over year in that dataset.

How to tell which applies to you

Calculate net revenue per available room by channel, not gross. The formula is booking value minus commission, minus channel marketing cost, adjusted for the cancellation rate of that channel.

Channel	Cost structure	Cancellation exposure	Use it for
OTA	15% to 30% commission	21.8%	Filling need dates and reaching new markets
Direct via brand search	CPC based, travel averages $2.14	10.6%	Capturing the billboard-effect searcher
Metasearch paid	CPC or commission per stay	10.6%	Intercepting the rate comparison moment
Free booking links	No media cost	10.6%	Baseline presence, never the whole plan
Email to past guests	Platform cost only	Lowest	Repeat stays and shoulder season

The decision rule: if OTA share is above 50% and your brand-search impression share is below 80%, your problem is not demand. You are paying commission on guests who already know your name.

What we’d do

TACK has built marketing systems for 300+ brands since 2009. For an independent hotel, resort or small group, the order runs like this.

Model net RevPAR by channel first. Before any media decision. Most properties have never seen commission, cancellation and marketing cost sitting in the same table, and the ranking usually surprises the owner.
Own the brand search result completely. Paid plus organic plus a booking engine that loads fast on a phone. This is where the 50% who leave an OTA to check you out either convert or return to Booking.com. At a $2.14 category CPC, defending your own name is the cheapest revenue in hospitality.
Run metasearch on both tracks. Free booking links for baseline presence, paid Hotel Ads for the conversion premium, measured on cost per net stayed room night rather than cost per click.
Keep OTAs deliberately, not accidentally. Use them for compression dates, new feeder markets and inventory you would otherwise discount. Do not use them as your default distribution because nobody rebuilt the booking path. That is the work our paid media and CRO team does on hotel engagements.
Make the property answerable. Travellers ask AI assistants about parking, pet policies, walkability and airport transfer times. If those answers live only inside an OTA listing, the OTA gets the citation. Publishing them on your own domain is the point of SEO, AEO and GEO.

Common mistakes

Treating commission as a cost of goods rather than marketing spend. At 18% on a $300 average daily rate, an OTA is charging $54 a night for customer acquisition. The same property will argue about a $2.14 click. Put both numbers in the same column and the budget conversation changes in one meeting.

Discounting direct instead of differentiating it. Undercutting your own OTA rate creates parity problems and trains guests to hunt. Give the direct booker something the OTA cannot resell: early check-in, a room-type guarantee, a credit, loyalty status. The margin difference funds it several times over.

Bidding only on generic terms. Travel’s 9.32% click-through rate is driven by branded and highly specific queries. Generic head terms in a market with OTA bidders is the most expensive way to lose. Start with your own name, your own neighbourhood and your own room types, then expand.

The bottom line

Hospitality marketing is a distribution economics problem. Once you can see net revenue per channel after commission, cancellation and media, the mix decides itself, and it almost always shifts toward defending brand search and metasearch rather than buying broader awareness.

If you want an outside read on your channel mix and what direct is actually worth, book twenty minutes at calendly.com/tack-media-agency/talk-to-an-expert or call TACK at 310-620-1141. Engagements start at $5,000 per month.