Glossary
The direct-booking glossary
Plain-English definitions of the terms independent hotel owners run into — OTAs, rate parity, RevPAR, booking engines, and the rest. No jargon, no fluff.
- ADR
- Average Daily Rate — the average room revenue earned per occupied room over a period, i.e. room revenue divided by rooms sold.
- Book-direct rate
- An incentive — a discount, member rate, or added perk — a hotel offers to encourage guests to book on its own site instead of through an OTA.
- Booking engine
- The software on a hotel's own website that lets a guest choose dates and a room and book — the tool that turns a website into a direct-booking channel.
- Booking window
- The gap between when a guest books and when they arrive — also called lead time. It shapes how far ahead a property can forecast and price.
- Cancellation policy
- The rules a property sets for whether, when, and how a guest can cancel a booking — and what, if anything, they are charged if they do.
- Channel manager
- Software that syncs a hotel's room availability and rates across multiple OTAs and its own booking engine, to avoid overbookings and manual updates.
- Chargeback
- A forced payment reversal a guest initiates through their bank or card issuer, rather than requesting a refund from the property directly.
- Direct booking
- A reservation a guest makes through the hotel's own channel — its website, phone, or email — rather than through an OTA, so no commission is charged.
- Dynamic pricing
- Adjusting room rates over time in response to demand, season, lead time, and occupancy — rather than charging one fixed price year-round.
- Length of stay
- How many nights a guest books in a single stay — and the rules a property sets around it, such as a minimum or maximum number of nights.
- Metasearch
- Price-comparison engines — like Google Hotels, Trivago, and Kayak — that show a hotel's rates across multiple OTAs and its direct site side by side.
- Net rate
- The amount a hotel actually keeps from a booking after commission and fees are deducted — the price the guest paid minus the platform's cut.
- No-show
- A guest who has a confirmed booking but never arrives and does not cancel — leaving a committed room empty for the night.
- Occupancy rate
- The share of a property's available rooms that are occupied over a period — rooms sold divided by rooms available, shown as a percentage.
- OTA (Online Travel Agency)
- A third-party website — like Booking.com, Expedia, or Agoda — that lists and sells a hotel's rooms in exchange for a commission on each booking.
- OTA commission
- The percentage an Online Travel Agency charges a hotel on each booking it brings — commonly 15–20% for independents, deducted from the room revenue.
- Overbooking
- Accepting more bookings than a property has rooms for a given date — usually by accident across channels, occasionally as a deliberate strategy.
- PMS
- Property Management System — the operational software a hotel uses to manage reservations, check-in/out, room assignment, housekeeping, and billing.
- Rack rate
- A property's standard, published room rate before any discounts, promotions, or negotiated deals — the full 'walk-up' price.
- Rate parity
- An expectation (often written into OTA contracts) that a hotel publishes the same room rate across all channels, including its own website.
- RevPAR
- Revenue Per Available Room — a hotel's room revenue divided by available rooms, or its average daily rate multiplied by its occupancy.
- Walk-in
- A guest who arrives without a reservation and books a room on the spot — no advance booking, no OTA, and no commission.
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