There is so much jargon used in the travel industry, it can be difficult to know your PMS from your OTA! We’re on a mission to try and break down all the acronyms and abbreviations to help people who are new to the hospitality industry understand what they all stand for and how the various systems are used. So what is a global distribution system and which hotel types will benefit the most from using it?
In the hotel industry, GDS stands for Global Distribution System. GDS is a computerised network that enables travel agencies and other distribution partners to access real-time information about hotel rooms, rates, availability, and other travel-related services. It is a critical tool for the travel industry as it facilitates the distribution and booking of hotel rooms and other travel products to a wide range of customers, including travel agents, corporate travel departments, and online travel agencies (OTAs).
There are really only 3 major GDS systems that you will likely hear about. Each one offers slightly different features and functionality, integration options and access to different types of hotel inventory. The 3 main players are:
The main difference between a GDS and an OTA is that the end user of GDS systems is travel agents, the corporate travel market and travel professionals rather than the general public. OTAs are accessible by anyone looking to book a whole range of travel services including accommodation, flights, travel packages, car rentals, tours and activities. A global distribution system can however send its inventory to an Online Travel Agency.
So just how does a GDS Travel System work? Much like the process with OTAs, your hotel’s PMS software (property management system) will connect to the GDS via a channel manager. The hotel’s live rates and inventory are sent directly to the GDS and other online booking channels. When bookings are made, the hotel’s availability will be changed instantly across all channels that it is advertised on to prevent overbookings. The GDA is effectively a middle man linking a travel agent with a hotel’s reservation system, sometimes known as the CRS (Central Reservation System). The key features and benefits of a GDS travel system include:
Given that GDS Systems are primarily used by travel agents and corporate travel bookers, the decision on whether it is a good strategy to list your hotel on a global distribution system will come down to who you are targeting. If you are looking to attract a more corporate, professional traveller, this may be difficult to target with your website alone or via the OTAs. A GDS connection would make sense in this scenario. So the main hotel types that will benefit from adding a GDS include:
As we’ve highlighted, if you’re targeting markets that may be otherwise difficult to reach, for example the international corporate travel market, a GDS can offer great benefits for hoteliers. The other key benefits include:
In summary, Global Distribution Systems play a crucial role in the hotel industry by connecting hotels with travel agents and helping them efficiently distribute their inventory to a wide range of customers.
Ideally your channel manager software should enable you to connect with all these online distribution channels and update your property’s availability and rates in real time. You should be looking to maximise your booking revenue potential by connecting to the entire booking ecosystem.
Investing in the right property management software (PMS) will ensure that you are able to manage your booking with ease across all of the online marketing channels including GDS systems.
At HiRUM we pride ourselves on industry leading PMS software being able to connect you with all the major travel meta search engines and OTAs as well as the leading GDS channels. Whatever your size and whatever your budget, we can help you find the right solution for your property.
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