“If you don’t like change, you’re going to hate extinction.” — Fred Smith, Founder of FedEx
The hotel revenue playbook is about to face its greatest stress test since the rise of online travel agencies. For two decades, Revenue Managers have built strategies around a mostly predictable, market shocks excluded, mix of business that partly came from direct traffic, and in the worst-case scenario they could always bid on it. But the ground beneath those strategies is shifting fast.
AI tools like ChatGPT, Gemini, and Perplexity are changing how travelers search. These systems do not deliver a page of options the way Google does. They generate an answer. To do this, they scan for structured content that looks like a question-and-answer pair. When they find it, they reuse it. If they do not, they often default to the simplest sources with the broadest coverage. Right now, that means OTAs. Expedia, Booking.com, and similar sites already have structured listings for millions of properties. They are easy for AI to ingest, even if the answers are shallow.
The danger is clear. If the model cannot find an authoritative Q&A from your hotel, it will not try to invent one. Sometimes it hallucinates, but more often it just produces a generic answer, often pointing travelers back to OTAs. AI tools are not evaluating what is best for the hotel. They are looking for the cleanest match between a prompt and an available answer, and in the absence of your content, the OTA wins by default.
The Coming Profit Erosion
When traffic flows to OTAs, hotels lose twice. First in profitability, because commissions still cut into margins. Second in control, because the guest journey begins and ends in a channel you do not own.
As AI strips out organic search discovery, this loss will accelerate. OTAs are betting on it. They know that most AI queries will not be “direct prompts” (your hotel’s exact name) but broad, competitive questions. Best value hotels in Cancun. Hotels near the Louvre. Five-star resorts with kids’ clubs. In those moments, the AI tools will lean on OTA listings, not your website.
Their wager is simple: hotels will be too slow to make their own content AI visible. And while hotels hesitate, OTAs will tighten their grip on the funnel.
The result will be a profit erosion massacre for hotels that fail to act. Margins that were already under pressure will be eaten alive by lost direct share.
The Kneejerk Trap: Dropping Rates
Faced with declining direct traffic, many Revenue Managers will react the only way they know how: by dropping rates. The logic will be familiar: if direct demand is soft, cut price to pull share.
But this time, the demand you are chasing will not return. Guests will never find you in a non-direct prompt. If your property is invisible to AI in competitive and destination contexts, cutting rates will not shift the discovery flow. It will only reduce profitability on the few bookings you still capture.
OTAs, meanwhile, will gladly accept the shift. Lower rates on their platforms mean higher conversion, higher volume, and more bookings under their control. The more you drop price to chase lost traffic, the more profit they extract.
Your Weapon: OTAs Cannot Win the Expert Content War
Here is the good news. OTAs will never have the content depth hotels possess. They aggregate, but they cannot speak as experts on your property. They cannot answer granular questions about your spa treatments, your kids’ menus, your wedding packages, or your early check-in policy.
And that is where AI visibility will be won or lost.
Think of the kinds of queries AI tools are built to answer: Do you offer vegan breakfast options? Can I book adjoining rooms for families? Is there late checkout for loyalty members? These are not OTA questions. They are hotel questions. They require expert-level answers, and only the property itself can provide them.
Hotels that structure this expertise into hundreds or thousands of granular FAQs will own the authoritative voice AI systems pull from. Hotels that do not will watch OTAs fill the void and drain their profits.
Why AI Visibility Cannot Be Left as a Marketing Battle
For years, hotels have treated SEO, social media, and brand campaigns as marketing’s domain. AI Visibility looks similar on the surface — content, questions, answers — so it is tempting to leave it there too. That would be a mistake.
AI Visibility is not just about messaging, it is about revenue. Every answer an AI system selects determines where demand flows and where profit lands. If your content is invisible, the OTA becomes the answer, and your margin shrinks. That is not a marketing concern; that is a revenue concern.
Marketing can craft narratives and campaigns, but they cannot carry the weight of protecting profitability against zero-click AI discovery. This belongs inside the revenue office, alongside distribution and pricing strategy. Revenue Managers understand the stakes of mix, cost of acquisition, and channel control. AI Visibility is now part of that equation.
The sooner hotels move AI Visibility out of the marketing silo and into the revenue optimization toolkit, the sooner they can defend profits against OTAs.
AI Visibility as the New Revenue Imperative
Revenue optimization used to mean shifting mix, adjusting rates, and managing distribution. In the AI era, it will also mean managing answerability.
- If you are not the source of detailed, structured content, you will not be the answer.
- If you are not the answer, the OTA will be.
- And if the OTA is the answer, your profits will erode faster than any rate strategy can fix.
The battle ahead is not just about price. It is about presence. It is about ensuring that when travelers ask AI tools competitive or destination questions, your hotel’s expertise, not a generic OTA listing, shapes the response.
Conclusion: A Warning to the Revenue Office
Revenue Managers have always known that distribution battles decide profitability. The next battle will not be fought in Google rankings or metasearch bids. It will be fought in the granular details that AI tools ingest and repeat.
Those who act now can turn their property’s expertise into an AI-ready lattice of answers and keep control of demand. Those who do not will enter a spiral of dropping rates, shrinking margins, and OTA dependency.
The profit erosion massacre is real. The only defense is AI visibility.
VisiLayer has already helped brands like Kimpton and InterContinental convert their content into granular, AI-visible answers, making them first movers in the transition to zero-click search. Hotels that move quickly can still seize the advantage. Those who delay will see their profits consumed by the very channels they once thought were partners.