Direct bookings or OTAs is the wrong question for most independent hotels. You’ll use both. The useful question is what each channel actually leaves you with after commission, fees and lost guest relationships, and how to move the mix a step at a time. This guide works through that with the platforms’ own terms and your own data.
We build direct booking systems through our hotel booking system service, so weigh that. Every fact below about Booking.com and Expedia was checked against their own partner pages and Booking Holdings’ 2025 annual report (10-K) in October 2026. The billboard-effect findings come from the Cornell studies themselves.
Short answer: neither Booking.com nor Expedia publishes one commission rate. Both set it per market and contract, and both sell paid boosts that raise it. Booking.com charges commission on the total booking amount, including fees, and on non-refundable bookings whether or not the guest stays. Direct bookings carry no commission, but they don’t arrive by themselves. Research from Cornell found that being listed on an OTA also brings extra bookings through a hotel’s own channels. So keep OTAs for discovery, and build a direct path that gives guests who already know you a reason to book with you.
Direct vs. OTA: What the Platforms Publish
As of October 2026, from Booking.com’s and Expedia Group’s partner pages:
| Item | Booking.com | Expedia Group |
|---|---|---|
| Published rate | No; set by country, property type and agreement | No; varies by market, shared at contracting |
| Charged on | Room rate plus fees, no-show and cancellation charges | See your contract |
| When owed | After checkout; invoiced monthly | Only when you have bookings |
| Paid boosts | Preferred Partner, Visibility Booster | Accelerator (per stay), TravelAds (per click) |
| Where you appear | Booking.com plus 17,500+ affiliate partners | Expedia, Hotels.com and more, plus a B2B network |
Sources: Booking.com: Understanding your commission, Expedia Group: Hotels, Expedia Accelerator, Expedia Sponsored Listings.
A direct booking has no commission line. It still has costs: your booking engine, card processing, your website and any ads that brought the guest. Those depend on the vendors you choose, so put your own figures next to the OTA numbers rather than borrowing anyone’s averages. Our side-by-side cost comparison walks through the cost per reservation. This post looks at revenue: what each channel lets you keep, and what it does for you beyond the booking itself.
What OTA Commissions Actually Cost You
Most hotel owners know OTAs are expensive. Fewer have run the annual number for their own property, mostly because the rate isn’t a public figure.
Booking.com says the exact percentage depends on your country, property type and the accommodation agreement you signed. You’ll find it in that agreement or in the Finance tab of the Extranet. If a reservation statement shows a higher percentage than your contract, Booking.com says you may be in a marketing program such as Preferred Partner or Visibility Booster (source). Expedia says compensation varies around the globe and that it shares the percentage for your market during contracting (source). On top of that, Accelerator lets you pay additional compensation on stays booked in dates you choose (source), and TravelAds charges for the clicks you get (source). We cover those Expedia costs in detail in our guide to Expedia commission rates.
So the honest annual number comes from your own contracts and statements, not a range from the web. A simple way to feel its size: every percentage point of commission costs 1% of the OTA room revenue it applies to. Our own arithmetic:
| OTA room revenue a year | Cost of each 1 point of commission |
|---|---|
| $100,000 | $1,000 |
| $250,000 | $2,500 |
| $500,000 | $5,000 |
| $1,000,000 | $10,000 |
Multiply the right row by your effective rate (total commission paid divided by OTA room revenue, boosts included) and you have the yearly figure. Run it per platform, because your contracts differ.
The platforms don’t charge a setup fee. They charge on every booking, including repeat stays from guests who first found you on the platform and now think of themselves as your guests, not the OTA’s.
The Revenue Gap Per Booking
Commission is only part of the per-booking picture. The other part is what the commission is charged on, and that base is wider than many owners assume.
Booking.com describes commission as a set percentage of the total booking amount. It includes the room rate and any additional fees you charge. Booking.com lists what’s commissionable (source):
- Confirmed stays, once the guest has checked out and paid
- Non-refundable and partially refundable bookings, whether or not the guest stayed
- No-show and cancellation fees you charge the guest
- Overbookings, because the room was available on the platform (waived for new properties and those with few overbookings)
- VAT or GST in most countries, depending on local law; local taxes such as city tax are not commissionable
There’s a deadline too. Booking.com asks you to mark no-shows, cancellations and other changes in the Extranet within 48 hours of checkout. If you don’t, it charges full commission on the original booking (source). A missed no-show can cost you commission on a stay that never happened.
The other half of the gap is the guest. You’ll often hear that direct bookers stay longer or spend more. That may be true for your hotel, or it may not. You can check it in an afternoon with a reservation export from your PMS, split by channel:
| Metric per channel | Why it matters |
|---|---|
| Average daily rate | Shows which channel sells at better rates |
| Length of stay | Longer stays mean fewer turnovers |
| Add-on revenue | Breakfast, parking, packages, upgrades |
| Cancellation rate | Cancelled rooms may not resell |
| Net room revenue | Revenue minus commission and fees |
Compare net room revenue per booking across channels. That’s your revenue gap, in your own numbers.
The Billboard Effect: Why You Still Need OTAs
Here’s the part that trips up a pure “go direct” plan. OTAs aren’t only a cost. For a property without a well-known brand, they’re also a large shop window, and there’s research on what that window is worth.
A 2009 Cornell study by Chris Anderson looked at hotels operated by JHM Hotels and listed on Expedia. When the hotels were listed, they saw more reservations through their own channels, not counting bookings made on Expedia itself. The study puts that lift at 7.5 to 26 percent across the four properties (source). The idea is simple: the guest learns about the hotel on the OTA, then books through a channel the hotel controls.
A larger 2011 follow-up analyzed 1,720 reservations for InterContinental Hotels Group brands across three summers. It found that for each reservation an IHG hotel received on Expedia, the brand’s own website received between three and nine more. The same study found the average consumer made twelve visits to an OTA site while researching hotels (source).
Two cautions. Both studies are more than a decade old, and they covered specific hotels and brands. Your own billboard effect could be larger or smaller. Treat them as evidence that the effect exists, not as a forecast for your property.
The strategic point holds either way: don’t abandon OTAs. Use them for discovery, and make sure that a guest who goes looking for you after seeing the listing finds a website worth booking on.
A guest who finds you on an OTA and then searches your name is a direct booking you can still win. What they need is a fast way to book and a reason not to go back to the OTA to finish.
The shift from OTA dependency to direct channel strength isn’t a switch. It’s a gradual rebalancing.
Why Direct Bookers Are Worth More Than They Appear
The per-booking comparison misses the longer-term difference: who owns the next booking.
When a guest books direct, you hold the relationship. You have their email and their booking history, and with their consent you can invite them back. When a guest books through an OTA, the OTA holds that relationship and works to keep it.
That’s not a guess. Booking Holdings’ 2025 annual report lists expanding Booking.com’s Genius loyalty program as a priority. It also credits an increase in the share of room nights booked by consumers coming directly to its platforms as a benefit to its marketing costs (source). In other words, the OTA is chasing the same thing you are: guests who come back directly. It spent $8.2 billion on marketing in 2025, mostly performance marketing on search engines (primarily Google), affiliates, metasearch and social media (source).
The guest who books direct is on your list. Their second and third stays carry no commission when they come back through your site. Our guide to turning OTA guests into direct email subscribers covers how to get there with guests who first booked through a platform.
This is the case for treating direct booking as infrastructure, not a campaign. You build it once, and it keeps working.
Six Tactics to Shift More Bookings Direct
Knowing the numbers is step one. These are the moves that shift the mix.
1. Best Rate Guarantee
If your direct rate matches or beats OTA pricing, say so on the booking page. What you’re allowed to offer depends on your contract and your country. Booking Holdings says Booking.com has implemented changes to address the Digital Markets Act’s prohibition on parity arrangements in the European Economic Area (source). Outside the EEA, read the parity clause in your own agreements. Our Expedia guide covers what regulators have said about parity clauses.
2. Direct-Only Perks
Where a lower price isn’t an option, a perk often is. Perks work because they don’t show on the OTA listing. A guest comparing you on Booking.com doesn’t know you include breakfast for direct bookers until they reach your site. Common choices: breakfast, a flexible cancellation option, a welcome amenity, late checkout or an upgrade when available. Pick two and show them on the booking page itself, not in the terms. Our direct booking incentives guide goes deeper.
3. Frictionless Checkout
A guest who switches back to an OTA mid-booking usually hit friction on your site. Keep the flow short: dates, room, add-ons, guest details, payment. Remove forced account creation, extra pop-ups and multi-page detours. Then test it yourself on a phone, start to finish, every few months.
4. Google Ads at the Moment of Intent
When a traveler searches your hotel’s name, OTAs can appear there too, because search is where they spend heavily. Booking Holdings says its performance marketing goes primarily to online search engines, mainly Google (source). Running Google Ads on your own name puts your direct link in front of the guest who is already looking for you.
There’s also a free route. Google’s free booking links let your booking site appear in Google’s hotel search with your room rate. Google says there’s no cost for clicks on them, and nobody can pay for a higher ranking. Ranking signals include value offered, landing page experience and price accuracy (source). Free booking links are separate from hotel ads, which are labeled “Ads” (source). If you use a reservation system, Google says your provider may already connect you, so ask them first (source).
5. Post-Stay Email: Convert OTA Guests to Direct
Every guest who stays with you, however they booked, is a direct booking opportunity next time, as long as you’ve collected their email with consent during the stay. A short post-stay sequence works: a thank-you soon after checkout, a review request, and a return-stay offer that only works on your website. Time the offer from your own data: look at how long repeat guests usually wait before rebooking, and send it before that. You can’t stop an OTA from getting the first booking. You can compete for the second.
6. Make Your Google Business Profile Work for Direct Bookings
Guests who find you on Google Maps or in local results and click through to your website have skipped the OTA step. Google ranks local results on relevance, distance and prominence. It says complete business information helps relevance, and that more reviews and positive ratings can help your local ranking. It also recommends replying to reviews. And it’s clear there’s no way to request or pay for a better local ranking (source). Keep the profile complete, add current photos, reply to reviews and link to your booking page, not just your homepage.
What Most Hotels Are Missing: The Infrastructure
The tactics work better, and last longer, when they run on infrastructure designed for direct bookings rather than patched onto a brochure website.
Three components make a direct strategy sustainable:
A website built to convert, not just to inform. Fast pages, a layout that works on a phone, real photography and a clear booking path from every page. A hotel website that puts the booking button within reach on every screen is what turns a guest who saw you on an OTA into a direct booker.
A booking engine that supports the full experience. This is where guests convert or leave. It needs real-time availability, add-ons and packages, your deposit and cancellation rules, and a smooth phone experience. Ask whether it can feed Google’s free booking links. A date picker that sends an email request is not a booking engine. It’s a form.
Google Ads to capture high-intent search traffic. SEO builds long-term visibility. Google Ads reaches the guest who is searching now. Bidding on your own name means your direct link shows when OTAs bid on it too.
The hotels that build all three aren’t picking one channel. They’re building a system around it.
The Annual ROI of Direct Booking Infrastructure
We won’t give you an ROI figure for your hotel without your numbers. Here’s the worksheet instead. It takes an hour with your PMS export and your OTA statements.
Current state: what to pull from last year
- Room revenue by channel (each OTA, direct web, phone, walk-in)
- Total commission paid to each OTA, including Preferred Partner, Visibility Booster, Accelerator and TravelAds
- Effective rate per OTA: commission divided by that OTA’s room revenue
Direct channel costs: what to price
- Booking system fees and card processing
- Website build and upkeep, spread over the years you’ll use it
- Google Ads plus ad spend
Scenario: what one shift is worth
- Pick a share of OTA room revenue you think could move direct
- Multiply it by your effective OTA rate: that’s commission kept
- Subtract the direct costs those extra bookings add: that’s the net gain
Run the scenario at a cautious share and a hopeful one. If even the cautious case covers the direct costs, the case is made. If it doesn’t, fix the cheapest gap first, often the booking engine or the post-stay email.
The infrastructure keeps working after it’s built. A website and booking engine set up this year still take bookings next year, while OTA commission is charged again on every stay.
The Strategic Target
The goal is a healthier distribution mix, with direct bookings carrying a growing share. There’s no universal target percentage. The right mix depends on your location, season and how well known you already are.
Getting more bookings direct doesn’t mean leaving OTAs. It means giving guests a reason and a path to book without them: a better website, a better booking engine, a presence on Google that you control, and a post-stay email that invites guests back.
None of these are radical changes. Together they make your distribution more profitable and more resilient, because a hotel that owns more of its guest relationships depends less on any one platform’s ranking or terms.
OTAs will keep bringing guests you’d struggle to reach alone. Use them for discovery, and capture the relationship, and the revenue, for every guest who comes back.
Related Posts
- Direct booking vs. OTA cost comparison: cost per reservation, channel by channel
- Direct booking incentives that work within rate parity: perks you can offer instead of a lower rate
- Turn OTA guests into direct email subscribers: building your list from platform bookings
- Google Hotel Ads for direct bookings: showing up where travelers compare rates
FAQ
Are direct bookings better than OTA bookings for hotels?
Per booking, a direct reservation carries no OTA commission, and the guest relationship is yours. But OTAs bring discovery you’d struggle to buy, and Cornell research found listings also lift bookings through hotels’ own channels. Most independent hotels do best with both, steadily growing the direct share.
What commission do Booking.com and Expedia charge hotels?
Neither publishes a single rate. Booking.com says it depends on your country, property type and agreement. Expedia says compensation varies around the globe and is shared during contracting. Your contract and statements hold the real figure, and paid visibility programs can raise it.
What is the billboard effect for hotels?
It’s the extra bookings a hotel gets through its own channels because it’s listed on an OTA. A 2009 Cornell study of four hotels listed on Expedia estimated the lift at 7.5 to 26 percent, excluding bookings made on Expedia itself.
Does Booking.com charge commission on cancellations and no-shows?
On the fees you charge, yes. Booking.com charges commission on non-refundable bookings, and on cancellation or no-show fees you collect. It doesn’t charge if you waive the fee and mark the no-show in the Extranet within 48 hours of checkout.
Can I offer a lower rate on my own website than on OTAs?
It depends on your contract and country. Booking Holdings says Booking.com changed its terms to address the Digital Markets Act ban on parity arrangements in the European Economic Area. Elsewhere, check the parity clause in each agreement, and use perks where price can’t differ.
How do I get more direct bookings without leaving OTAs?
Keep your OTA listings for discovery. Then make booking direct easy and worth it: a fast booking engine, direct-only perks, ads on your own name, Google’s free booking links, a complete Google Business Profile, and a post-stay email that invites guests back.
OTAs will keep sending you guests. Make sure the ones who come looking for you can book you. A direct booking system on your own website is where that starts. Get in touch to talk it through.