The Optimal Path for OTA and Direct Booking

In Japan's short-term rental (STR) market, guest acquisition strategy is one of the most critical factors determining investment returns. This article outlines our perspective on the differences in acquisition approaches between urban and resort areas, the characteristics and risk management of major OTAs (Online Travel Agents), and the steps required to build direct booking channels.

1. Differentiated Guest Acquisition Strategies by Location

The optimal guest acquisition approach for STR properties varies significantly depending on location.

In urban areas such as Tokyo and Osaka, maintaining sufficient occupancy rates is achievable through OTA (Online Travel Agent) channels alone, given their overwhelming search volume. Urban accommodation demand is heavily dependent on transportation convenience and access to tourist attractions, making it possible to secure stable bookings by leveraging OTA search algorithms.

Conversely, in resort areas, relying solely on OTAs has clear limitations. In resort destinations, the act of staying at a specific property becomes the primary purpose, and direct bookings tend to outperform OTA channels compared to competing facilities. Therefore, for STR investments in resort areas, establishing direct booking channels in parallel with OTA distribution is essential.

2. Our Perspective 1: Major OTA Comparison and Risk Management

While OTA utilization remains fundamental to STR guest acquisition, each platform has distinct characteristics and risks. A portfolio strategy that does not depend on a single OTA is therefore required.

Airbnb: Overwhelming Guest Acquisition Power and Significant Risk

Airbnb remains the most common and powerful channel for STR guest acquisition. However, concentrating entirely on Airbnb carries substantial risk.

The primary risk is excessive dependence on guest reviews. When a property receives three or more low ratings (3 points or below) within a three-month period—whether from malicious guests or minor operational oversights—the listing faces suspension or deletion as a severe penalty. This means that regardless of how many high ratings have been accumulated, the revenue foundation can be lost instantaneously.

Booking.com: Risk Hedging and Capturing Hotel Users

To hedge against Airbnb's review risk, using Booking.com in parallel is highly effective. Booking.com does not impose immediate penalties such as listing suspension even when review scores temporarily decline, and it has the advantage of generating bookings even for properties in less-than-ideal locations.

However, Booking.com's user base consists primarily of hotel guests, so properties are expected to meet hotel-quality operations, service, and amenities. When there is a gap between these expectations and the actual service level of an STR property, low ratings become likely.

To prevent this expectation gap, the following measures must be rigorously implemented:

1. Accurate definition of listing information: Clearly state which services are provided and which are not (such as the absence of daily cleaning).
2. Detailed guidance via booking confirmation email: Immediately after booking confirmation, provide detailed information about STR-specific rules and self-check-in procedures.
3. Pre-arrival expectation management: Clearly communicate at all touchpoints before and after booking that the experience differs from a hotel stay.

HVMB (Homes & Villas by Marriott Bonvoy): High-Rate Opportunity

HVMB (Homes & Villas by Marriott Bonvoy) has a limited global user base, and the number of listed properties in Japan remains relatively small.

However, it offers the significant advantage of acquiring bookings at higher average daily rates (ADR) compared to other OTAs. While listing requirements are stringent, meeting HVMB's standards and utilizing capable management companies to handle listings can elevate revenue performance.

3. Our Perspective 2: Steps to Building Direct Booking Channels

Particularly in resort areas, establishing direct booking channels independent of OTAs is essential for achieving stable, high returns. Successful direct booking requires the following steps.

Step 1: Developing Distinctive, Instagram-Worthy Properties

The foundation of direct booking success is the property itself. First, properties must have a degree of uniqueness and be visually compelling and shareable on social media. This means incorporating elements that guests naturally want to share—architectural design, interior aesthetics, distinctive amenities (such as saunas or infinity pools), or exceptional views—into the property development from the outset.

Step 2: Strategic Social Media Management and Advertising Investment

Once an attractive property is complete, full-scale social media operations should commence. Today, platforms like TikTok and Instagram reach not only younger demographics but also a broad range of age groups, making them powerful marketing tools.

Beyond organic content creation, investing in targeted social media advertising to amplify reach is highly effective. By partnering with management companies that possess digital marketing expertise, resort-area STR operations can achieve both revenue stabilization and maximization.

4. Conclusion

Guest acquisition in STR investment centers on OTA optimization in urban areas but requires greater emphasis on direct booking in resort destinations. The optimal strategy combines Airbnb's powerful guest acquisition with Booking.com as a hedge against account suspension risk, supplemented by high-rate channels such as HVMB.

To build long-term competitive advantage, developing distinctive, Instagram-worthy properties and establishing professional digital marketing-driven direct booking channels are the keys to investment success. We provide comprehensive support from the property planning stage, incorporating these acquisition strategies throughout the entire development and operational lifecycle.