The Basics of a Channel Manager:

A Guide for Independent Hoteliers

Contents

Why you need one 3

Features to look out for 5
Costs to consider 10
Buyer’s Guide Checklist 11

The Basics of a Channel Manager: A Guide for Independent Hoteliers 2

 As an example, if a hotel has 100 rooms and is working with 10 Online Travel Agents
(OTAs), that hotel must then give 10 rooms to each OTA. That’s in theory. What
actually happens, however, is that hotel will provide its best suppliers more rooms,
meaning the smaller players get way less than the average 10.

Why you need one

100 Room Hotel
If you’re wasting too many hours of your day
posting hotel availability information and
current rates on various extranets, then this 20
Rooms
20
Rooms
is where a channel manager can step in and
shift the needle.
Ultimately, a channel manager allows you to distribute 10
Rooms
10
Rooms
the rooms that you have available across a variety of
different channels, providing you with an opportunity to
reach a global audience. 10
Rooms
10
Rooms

Without a channel manager, you’ll have to split your

room availability among different agents to ensure that 5
Rooms
5
Rooms
you don’t overbook your rooms on any given night. This
can lead to wasted inventory and lost profits.
5
Rooms
5
Rooms

This means the hotel has to constantly monitor and shuffle its inventory, with the
real risk of missing bookings, as they run out of inventory on the smaller – but still
valuable – OTAs.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 3

Why you need one

Through a channel manager, you can display your live

availability across all your channels, allowing various
agents to book your rooms at any given moment.

A channel manager is the only way to tap into the

potential of the virtually endless online booking market.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 4

Features to look out for

If you are interested in educating yourself on the channel manager

options available to you, the following information can prevent you
from picking a system that doesn’t suit your hotel’s needs.

Here are the kinds of features you should be looking for

when choosing the best channel manager for your hotel.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 5

Features to look out for

Numerous channel connections

You need to make sure that the channel manager you choose…

• Supports the booking sites you already sell through; and,

• Gives you the opportunity to connect with new booking sites
that reach different markets.

This ensures that you will connect to as many sites as possible without ever
worrying about overselling your rooms. Making sure international travellers can easily
book with you is a top priority for independent hotels. Your channel manager should
help you do this by allowing you to partner with a variety of OTAs that can allow you to
reach markets you could never access directly.

For example, to sell your rooms to Chinese travellers, you should connect with Ctrip,
because it is the preferred booking site in China. The more sites a channel manager
connects you to, the better.

Using a true pooled inventory model, SiteMinder’s Channel Manager helps tens of
thousands of hotels worldwide increase their online exposure to convert prospective
guests into paid bookings.

Providing two-way XML connections to more than 300 of the world’s leading booking
channels from one central cloud application, SiteMinder’s Channel Manager provides
properties of any size a way to maximise exposure, increase revenue, and reduce
overall costs.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 6

Features to look out for

Deep system integrations

Your channel management software should

integrate with your existing core systems,
so there is only one view of inventory and
bookings at any point in time.
SiteMinder’s Channel Manager allows you to eliminate
manual entry and reduce the risk of overbookings with
deep integrations to 120+ of the world’s top PMSs, CRSs
and RMSs.

You can update your rates and apply stop-sells at the

click of a button. The channel manager will automatically
reduce availability when a room is booked on any one of
your sales channels.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 7

Features to look out for

Solid reporting on which channels work

Here is
an example
It goes without saying that in order to manage your from SiteMinder’s
revenue successfully, you must be able to see all your Channel Manager
revenue streams – from the online booking websites showcasing channel
effectiveness
where you advertise your property, to your marketing over time:
and sales efforts.
A good channel manager will allow you to easily track and measure
which online sales channels are working. This gives you the knowledge
you need to negotiate commissions and end partnerships that aren’t
working for you.

Your channel manager will run seamless connectivity using pooled You should use your channel manager to look at:
inventory delivered to some of the world’s biggest online travel agents
and third party booking sites. Here at SiteMinder we have more than • Your channel yield
300 available to our hotel customers all over the world.
• Earnings from reservations
We know it’s unlikely you’ll connect to all 300 at your hotel, but let’s say
• Booking volume and average lead time
you connect to 10% of those available. That’s still 30 channels to analyse
and report on – a big job for any busy hotelier.

By choosing a channel manager with comprehensive built-in reports,

you’ll gain faster and more effective insights into how your inventory
is performing across all 30 distribution channels so you can chop and
change as it’s needed. It’s critical to compare and understand how
successful each channel is in terms of revenue – especially when you
want to try connecting with a new channel for your market.
How to action these metrics
Armed with these insights, a data-driven hotelier can adjust their strategy
accordingly and make confident decisions on things like, when to reduce
availability, when to close out rooms, or when to increase rates on the
channels that generate the least revenue in favour of those that are
more profitable.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 8

Features to look out for

Pooled inventory

SiteMinder’s Channel Manager uses a pooled inventory

distribution model. But what does that mean and why
is it beneficial? Pooled inventory means that you evenly Meritxell Pérez from HotelsDot, a company specialising
distribute all your available rooms across a number of in revenue management and online marketing mostly
sites – including your own website. for independent hotels and small chains, says:
In this case, all inventory is automatically reduced across all booking
sites when a booking is made on any site. SiteMinder’s Channel
Manager works in real time so if there’s one room left on Booking.com
and one room left on Expedia, and one of those sells, it’ll be updated
on all sites immediately.

Crucially by using the pooled inventory model, SiteMinder allows
hoteliers to sell their stressed inventory - the very last remaining
rooms - helping maximise revenue. You can read more about this
model on our blog. With pooled inventory, you can provide all your
OTAs with all of your inventory at once, so you never miss a booking.
Secondly, and more importantly, by giving all of the OTAs all of your
inventory at once – which is what pooled inventory supports – most of
the OTAs will reward you with better visibility in their ranking algorithm.
No one knows for sure what the actual algorithms are and they do
change from OTA to OTA, but generally OTAs are keen to provide
priority if they have more rooms to sell its simple business logic.
“It’s fundamental to have the technological tools that help you to
speed up the management of all the data and variables we analyse
daily... I think a tool like SiteMinder‘s Channel Manager is essential,
or any other that could help you in this way.
SiteMinder has 100% reliability, and I am really happy with how it
works - the usability is very intuitive for creating reports, and we get
data that it is very useful to us. We use these reports to see how sales
are performing in the different channels, and the support team is very
efficient, they answer quickly.”

The Basics of a Channel Manager: A Guide for Independent Hoteliers 9

Costs to consider

Independent hotels and smaller chains have

to be extremely careful with how they spend
their budget, so it is important to assess the
costs involved.

Licensing cost
The cost of using the software will either be in a
commission-based or flat monthly fee format.

A flat monthly fee is better for budgeting purposes, and

will allow you to reinvest most of your revenue back into
the property as you grow (instead of taking a significant
chunk of it).

Additional training, setup, and user fees

Find out if you will be charged for initial setup and
training. Some will also charge you per additional user
that you add to your account (for example, if you want to
give your new receptionist access to it).

The Basics of a Channel Manager: A Guide for Independent Hoteliers 10

Buyer’s Guide Checklist: Fill in this form and compare

Vendor 1: Vendor 2: Vendor 3:

Feature
Does it offer Yes - two-way XML connections
two-way channel are available to 300+ of the world’s
connections? leading booking channels.

Is pooled inventory Yes - ensures you can sell your

available to maximum available rooms on many
maximise revenue? channels at any given time.

Are integrations Yes - deep integrations to 120+

enabled with your of the world’s top PMSs, CRSs,
current systems? and RMSs.

Does it deliver Yes - The Channel Manager reports

comprehensive on channel yield, earnings from
reporting to reservations, booking volume,
measure success? and average lead time.

Are you signing up

Flat monthly fee with no commission
for a contract? Is it
involved. Free trial for 14 days offered
a flat monthly fee or
and no lock-in contracts.
commission-based?

The Basics of a Channel Manager: A Guide for Independent Hoteliers 11

 See how The Channel Manager can help you...

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