OTA Promotion ROI Calculator
Find out whether an OTA discount or deal actually makes money once commission, cannibalised bookings and room costs are counted.
How to use the free OTA Promotion ROI Calculator
- Enter your figures in the fields above – use real numbers from your PMS, channel manager or accounts.
- Tap the button to see the result instantly. Change any value to compare scenarios.
- Copy, print or save the result and use it in your daily or monthly review.
This OTA Promotion ROI Calculator runs fully in your browser on mobile or desktop – no sign-up and nothing is uploaded. Free OTA promotion ROI calculator for hotels. Include commission, GST, cannibalised bookings and room costs to see net gain and break-even room nights.
The hidden cost of an OTA promotion
An OTA promotion — a deal of the day, an early-bird offer, a festive sale — brings two kinds of bookings. Some are genuinely new guests who would not have booked you otherwise. Others are guests who were going to book anyway and now simply pay less. The second group is called cannibalised business, and it is why a promotion that looks busy can still lose money.
Net rate means what reaches you after OTA commission. Where your room tariff is up to ₹7,500, hotel GST is 5% without input tax credit, so the 18% GST charged on OTA commission is a real cost. Above ₹7,500 you are in the 18% slab with ITC and can usually set it off. Confirm your position with your CA.
Worked example
Normal rate ₹4,000, 15% discount, 18% commission plus GST on commission, cost per occupied room ₹900. You expect to sell 120 room nights anyway, 40% of which will switch to the promo rate, and the promotion brings 30 extra nights.
- Net per night: ₹3,150 normal, ₹2,678 promo
- Contribution from 30 extra nights: about ₹53,300
- Lost on 48 cannibalised nights: about ₹22,700
- Net gain: about ₹30,600; break-even is 13 extra nights
How to make promotions pay
- Run them on soft dates only. Exclude weekends, long weekends and festival dates that sell anyway.
- Keep discounts modest. Every extra 5% raises the cannibalisation cost on every booking.
- Measure honestly: compare room nights during the promotion with the same period last year or recent weeks.
- Know your real commission with the OTA commission calculator, and compare what a direct booking would have earned with the direct vs OTA savings calculator.
Frequently asked questions
What is a cannibalised booking?
A booking at the promotional rate from a guest who would have booked at your normal rate anyway. You get no extra room night, only a lower rate.
How do I estimate extra room nights from a promotion?
Compare bookings for similar dates with and without past promotions, or with the same period last year. Be conservative; most hotels overestimate the extra business.
Is GST on OTA commission a cost for my hotel?
If your room tariff is up to ₹7,500 per night, you pay 5% GST without input tax credit, so the 18% GST on commission is usually a cost. Above ₹7,500 you can generally claim it as ITC. Check with your CA.
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