Hotel groups double down on loyalty to counter OTAs and AI agents

Direct relationships become a strategic defense as booking shifts toward AI-led discovery

Major hotel groups are accelerating efforts to drive direct bookings through loyalty programs as a way to reduce dependence on online travel agents and prepare for the rise of AI-powered booking agents. Companies such as Marriott, Hilton, Hyatt, and Wyndham are enhancing perks, partnerships, and technology to strengthen customer relationships and capture more guest data. While AI agents could lower distribution costs compared with traditional OTAs, they also risk weakening brand awareness by prioritizing convenience over loyalty. As a result, hotel groups see loyalty as both a cost-control lever and a long-term strategic asset.

Key takeaways

• Loyalty as a distribution strategy: Large hotel groups are using loyalty programs to shift bookings away from intermediaries and reduce commission costs that typically range from 15–25 percent.
• Rapid growth in membership bases: Marriott’s Bonvoy program reached nearly 260 million members, highlighting how scale and incentives are driving more direct customer engagement.
• Perks and partnerships drive differentiation: Hilton and others are expanding benefits and external partnerships, allowing members to earn and redeem points beyond hotel stays to strengthen program appeal.
• AI agents as both opportunity and risk: Autonomous AI booking tools could offer a cheaper alternative to OTAs, but may also dilute brand influence by focusing on price and convenience rather than brand preference.
• Data and personalization advantages: Direct bookings enable hotel groups to collect richer guest data, supporting more personalized experiences and higher repeat visitation.
• OTA dependence under scrutiny: Executives and analysts agree that while OTAs deliver incremental demand, overreliance is costly and strategically risky for large brands.
• Competitive tension with OTAs persists: Booking Holdings and Expedia acknowledge direct competition with hotel loyalty programs, while arguing that OTAs still provide complementary value, particularly for smaller operators.

Source: Financial Times

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