Digital marketing has been around for more than 20 years, yet it still feels very disruptive, and for most organizations, is under-delivering on its promise—which is to create a sustainable source of new customers, nudge past customers to rebook, and reduce the cost of delivering exceptional customer service.
Most hotel brands are among the disappointed. While digital is a significant portion of revenue for these brands, it is generally not meeting the expectations of hotel executives at all levels of digital marketing spend. Among the reasons for this, OTAs have created a major disruption and continue to draw direct bookings away from brands. Then, too, instead of reducing the cost of customer service, online reputation management has generated an endless source of bad reviews, many of which are not substantiated. Adding to the problem, it is common for digital marketing providers to pursue an innovation-above-all-else strategy for their clients, even those for whom just executing the fundamentals provides enormous opportunities. (Being presented with options for Alexa Voice Apps or Chatbots by your agency partner—even though web traffic, conversion rates, and/or email engagement rates are decreasing—is a prime example of this.)
But there are ways to achieve fast and sustainable results. Here are some digital marketing best practices for growing a hotel’s direct booking revenue.
Understand Paid Media Results
It is typical for a new client to arrive with a handful of very high-level reports explaining how the media is performing. The real story, though, is found in a deeper analysis of the data. For example: On the surface, the aggregate spend is $500,000, generating $5 million in revenue. However, a closer look at that $500,000 reveals that only $150,000 of that $500,000 generated the $5 million, and the remaining $350,000 was spent on campaigns running for over a year that never produced a single booking. On average, 58 percent of media spend is being run for too long on campaigns, generating negative results.
Spend More on Digital Marketing
While hotels make a point of ensuring that their lobby is in order so guests are well received upon arrival, they need to be equally concerned with the impression guests receive upon arrival at their website. For longterm success, it is vital to commit to attending to guests’ impression of the hotel website. Hoteliers must conduct a thorough end-to-end website examination on a weekly basis to discover— and promptly resolve—the issues, the frustrations, and the gaps in content customers may have the opportunity to encounter.
In this digital age, it is important to focus less on overhauls and more on making incremental changes to improve website appearance and function.
In this digital age, it is important to focus less on overhauls and more on making incremental changes to improve website appearance and function. Rather than wasting time and delaying results by starting from scratch to make desired changes, it’s better to build a multi-month plan, addressing and launching one page at a time.
The scenario below substitutes the example of a corporate lobby for a corporate website to quantitatively illustrate the wisdom of regular website maintenance. The number of people who visit a corporate lobby in a year is divided by the initial cost to build the lobby, plus the yearly costs to maintain the lobby. If it costs $25,000 to maintain a lobby where there were 25 visitors a week (1,300 visitors a year), the cost per visitor would be $19. By multiplying that cost ($19) by the number of unique visitors to the website— a far more significant source of bookings than the hotel lobby, for example, 2 million—it would add up to an annual website spend of $38 million.
Don’t Waste Web Traffic
A/B Testing—also known as bucket tests or split-run testing—is a way to compare two versions of a single variable in, for example, a webpage or app against each other to determine which on performs better. Testing one change at a time helps pinpoint changes that do or do not impact visitors’ behavior. This method of introducing changes to a user experience also allows the experience to be optimized for a desired outcome, and can make crucial steps in a marketing campaign more effective.
Every website visitor costs money, time, and effort; and each time that visitor leaves without converting (via sign-up, booking, newsletter, or RFP submission), it is a lost opportunity. For example, 2 million visitors at a 2 percent conversion rate generate 40,000 bookings a year from digital. Raising that conversion rate 10 percent to 2.2 percent generates yet another 4,000 bookings a year; at a $300/average booking rate, that equates to another $1.2 million in bookings a year—a pretty immense change.
It is clearly worthwhile to have someone whose focus every day is on improving the conversion rate. This can be done by analyzing the path to booking, the content along the path, and the types of assets being displayed; creating personalization; and leveraging A/B tests. This begins with documenting the full path to booking online, understanding the conversion rate at each step, and executing small changes.
Think Beyond Booking
Booking hotel rooms is not the only way to convert visitors to a brand. The website can offer opportunities for visitors to become known to the brand for remarketing. The site should, therefore, make it easy to not only sign up for offers, but also become a loyalty member, receive a text with a map of the area, click to call, and provide a number and receive a callback from the hotel. All of these initiatives are easy-to-implement conversion opportunities that expand the value of the visitors that didn’t book a room this time, but may be returning to the area.
The ability to drive reliable revenue from previous guests depends on getting to know them and finding opportunities to create engagement. For example, it is possible to spike revenue at a property by focusing on previous guests who are in the area and might enjoy a staycation; or recognizing that a previous guest is looking at the same hotel room and acknowledging it.
The biggest miss in hotel email programs is in “guest onboarding” prior to the visit, which offers opportunities to educate—and possibly upsell—guests about the hotel amenities, and also provide information about attractions, nearby restaurants, transportation, etc.
To effectively use email, it is important to develop guests’ personas based on a definition of the data needed to determine them, and develop a series of emails creating brand advocacy, encourage sharing, and more.
Exploring All Variances
The booking flow should be seen as a multistep process. This starts with understanding all traffic sources, and having increases/decreases reported daily and compared to the previous date, month, or year.
It is important to understand which pages are the most common along the booking path, what percentage of visitors move from one page to the next in the path, and drop off rates for every page of the booking engine. This should provide metrics that can be measured every day, with a focus on what to improve; it’s a good idea to focus on one metric a week to look for improvement opportunities.
Hoteliers should know the whole funnel and have insight into it daily. This is the greatest weapon in improving direct bookings.