Hotels typically sell rooms in three or four different places online. These are called distribution channels, with some of the most popular ones being OTAs like Booking.com, Expedia or Trivago. However, what most independent hotels are stuck doing is manually managing all these channels simultaneously, leading to mismatched rates, double bookings, and no single source of truth for the hotel team to follow.
A channel manager is the solution; a software that handles all room distribution, vacancy and occupation information automatically and instantly. This handy tool sits between a hotel's property management system and every distribution channel where rooms are available, pushing availability and rates outward and pulling reservations inwards, so one change lands everywhere within seconds.
This ultimate guide is designed to explain to the independent hotelier what a channel manager is, what it does in practice, how it differs from other hotel systems you may already have, how to choose the best fit, and what the transition process to a new tech system entails.
Ready to elevate your room sales across OTAs and your own booking engine? Book a free demo of Noovy’s state of the art tech stack and let us help you maximise your performance and revenue today!
How Does a Channel Manager Work?
Channel Manager, PMS, and Booking Engine
Why Independent Hotels Need a Channel Manager
How to Choose a Channel Manager
The 5 Best Channel Managers for Independent Hotels
Switching Channel Managers: What It Involves
Hotel Channel Manager: Wrap-Up
A hotel channel manager is a digital tool that sits between a hotel's property management system and every online channel that sells its rooms. Its main responsibility is updating room availability, rates, and restrictions in real time across all digital channels. That way, a booking taken anywhere updates your inventory everywhere.
The three main data types that a channel manager deals with are abbreviated as ARI (Availability, Rates, and Inventory). So essentially, a hotel channel manager makes sure your hotel ARI is identical and up to date everywhere a guest can potentially book a room.
Most often, hoteliers confuse the channel manager for other important hotel management tools. To clarify, there are three key tools that work together. They are:
Some vendors like Noovy sell all three tools as a single platform; others sell hotel channel management software standalone, alongside broader hotel distribution software. Regardless, all three tools should share a single truth: a pooled inventory. When they do not, hotels can face a real reconciliation problem in the form of overbookings.
The main function of a channel manager is to work as a continuous two-way loop between a hotel's inventory and every channel that room sales are available on. This cycle has five steps:
Some hotels opt for segmenting their inventory across the various OTAs where rooms are available, but this can lead to problems such as uneven sales, or poor data integration. The best approach is to create a pooled inventory, meaning every channel draws data from a shared pool of rooms. In this approach, fifty rooms are fifty rooms, visible to all booking channels.
An important component of a functional channel manager is to ensure connection quality for live data transfer. A verified connection is an official, maintained link to all channels where hotel rooms are available. This makes sure that updates happen in real-time, and the risk of double bookings are heavily reduced.
The quickest way to differentiate the difference between a hotel channel manager, property management system (PMS), and booking engine, is to see their function side by side. Each system follows a distinct job, which in turn helps the other two departments function too.
Here’s a simple breakdown, including the revenue management system (RMS) as well to form a full, digital hotel management system:
| System | What It Does | What It Helps |
| PMS | Runs the property: reservations, arrivals, housekeeping, billing. | Hotel Management and Team |
| Channel Manager | Distributes room availability and rates to all channels, and returns reservations. | OTAs, Metasearch, GDS |
| Booking Engine | Allows hotels to take reservations directly on their own website. | Direct Guests |
| RMS | Recommends what to charge per product, based on demand. | Revenue Decisions |
Once laid out, the differences are simpler than it seems: the PMS is the brain, the booking engine is the direct seller, and the channel manager distributes rooms to every other channel.
The question most independent hotels ask at this stage is whether their hotel needs both a PMS and a channel manager. For most mid-sized hotels, the answer is a resounding yes. The PMS to channel manager relationship matters a lot for synchronising inventory, avoiding human errors, granting hotel front desk the oversight they desperately need, and automating countless hours of manual work.
When choosing a property management system, booking engine, or channel manager alike, it’s highly recommended to subscribe to a cloud-based tech provider that can facilitate all tools in an integrated manner.
The case for a hotel channel manager really comes down to four key arguments, and tech vendors typically only mention one. Here’s our breakdown of why an independent hotel can benefit significantly from a modern channel manager:
That being said, not every hotel needs a channel manager. If your hotel only sells through a single OTA and your own hotel website, then two logins are entirely manageable by the hotel team, and the subscription price of a channel manager may be too high to offset by room sales.
If your hotel is selling on two or more channels simultaneously, then it becomes more important to balance OTAs and direct bookings with a channel manager for the most profitable outcome.
There are key markers that separate hotel channel management software that works from software that “technically functions”. Each comes with a question to be asked to a vendor, to make sure your management gets a full picture of what they are buying:
There is no such thing as a single best channel manager for hotels. Every comparison published by a guide will have a vested interest to place their product ahead, which is why our breakdown weighs each vendor against key criteria, including what each product does best.
At the end of the day, the best option for each hotel will depend on many factors, such as hotel size, product needs, budget, and the existing hotel management system.
The best option for European independents wanting a single, unified system.
Noovy provides one of the most comprehensive hotel management scopes on the market, containing a PMS, booking engine, revenue management tools and automated guest communication all run on a single pooled inventory.
That way, there are no lengthy integration difficulties or need for API connectivity when a single tech vendor can host the entire digital ecosystem needed for modern hotel management.
Key stats to consider:
Great for hotels wanting breadth of connection and for hotels that already work with a PMS they like.
SiteMinder is one of the most-deployed channel managers for independent hotels around the world, and with of the longest track records in the industry. While Siteminder does not provide a PMS of its own, it makes up for it with a massive integration scope with over 350 third-party systems instead of forcing you to replace yours.
Key stats to consider:
Great choice for larger independent hotels and small groups needing feature depth.
Features one of the broadest product suites on the market, with a strong reputation for effective customer support. The channel manager is unfortunately only available from the second subscription tier upwards rather than at entry tier.
Key stats to consider:
A great choice for very small properties that want to be online within mere days.
Little Hotelier is deliberately designed to be a narrower tool than the others on this list, but in turn it provides the smallest learning gap, least configurations, and lowest entry price.
A great choice for small European hotels wanting to buy only what they use.
Long-established in Europe with a strong base, eviivo offers a modular structure that means hoteliers don’t pay for features they do not want or intend to use. The only downside is that it means the entry price is almost never the final price.
As can be seen from the best channel manager breakdown, the right choice relies heavily on the hotel size, scope of connectivity, and intended growth. If your hotel already runs a PMS you are happy with, a standalone channel manager is a sensible route.
If your hotel is looking to move towards a full hotel management system that is integrated from the start, a complete package like Noovy would make the best sense.
Switching from an existing channel manager to a new one is less disruptive than most hoteliers expect, yet more fiddly than what most vendors are willing to admit. There are three steps a switch contains:
For a broader understanding of the mechanics behind moving hotel software - including data, timing, and what cannot be transferred - be sure to check out our guide on cloud hotel software migration for the full picture.
A channel manager is a key component of any integrated hotel management system, and it plays a critical role in itself. It lets you sell hotel inventory in several places without accidentally booking it twice and having to disappoint any guests.
The threshold of needing one as an independent hotel is low. In fact, if your inventory is available on two or more OTA channels, it’s already a good enough reason to invest in a modern hotel channel manager. For hotels above this threshold, the question is about the scope and quality of the product offered by your chosen tech vendor.
If you are choosing a channel manager for the first time, it’s a good idea to brush up on small hotel management best practices to see where the need for a channel manager sits alongside your most critical needs.
There is no shortage of impressive tech vendors and hotel management tools on the market, but Noovy’s real strength lies in its all-encompassing product. With a full tech stack (PMS, RMS, Channel Manager, Automated Guest Messaging etc.) under one price, Noovy provides:
Ready to maximise revenue from OTAs and direct bookings? Book a free demo with a Noovy expert to see how one pooled inventory keeps every channel accurate, automatically.