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The Smart Hotelierís 2013 Top Ten Digital Marketing Resolutions
By Max Starkov & Mariana Mechoso Safer
As we find ourselves in a new year full of possibilities, now is a good time to reflect on events that impacted our industry in 2012 and how you should plan your digital marketing efforts throughout 2013. The continuing transformation of travel consumers into multi-device and multi-channel users, the explosive growth of the mobile and tablet channels, the proliferation of new social media platforms, and ongoing Google algorithm updates are just some of the topics that made headlines last year.
This is also the perfect time to review your business goals and objectives. What did you achieve in 2012 that you would like to improve upon this year? What business goals did you not achieve? Were you distracted by the next big thing and as a result lost sight of hotel digital marketing fundamentals? Which digital channels and formats most effectively reach today’s hyper-interactive travel consumers and generate the highest ROIs? What strategy should hoteliers adopt to stay competitive in this increasingly convoluted digital world we all live in?
The 2013 Top Ten New Year’s Digital Marketing Strategy Resolutions, presented by HeBS Digital for the 13th consecutive year, answers these questions and provides guidance on what hoteliers should do to succeed in the year ahead. With an improved outlook for the industry, technological advances, and the usage of mobile devices growing exponentially, opportunities for incremental revenues abound.
Here are the Top Ten Digital Marketing Resolutions your hotel company should consider adopting in 2013:
1. I believe that 2013 is the Year of the Three Screens in Hospitality: desktop, mobile and tablet. I will deliver a customized and user-friendly experience across these three screens.
Internet users exhibit behavioral patterns when browsing the Internet and the desktop website, mobile and tablet devices address different needs at different times of the day and week. Users searching Google utilize their desktop during the day (office), mobile devices during lunch breaks and happy hours, and tablets in the evening when lounging (Google).
According to Google, seven percent of all searches come from tablets versus 14 percent from mobile devices (smart phones) and 79 percent via desktops in 2012. In 2013, searches from mobile devices will experience an increase of 68 percent and searches from tablets will increase by more than 180 percent. Desktop searches will experience a decline of four percent. Across HeBS Digital’s hotel client portfolio, tablets already generate 200 percent more room nights and 430 percent more revenue than “pure” mobile devices:
Sources of Traffic and Bookings by Device Category January-November 2012:
Search engines and many major media sites consider tablets a distinct device category characterized by its own unique user behavior and best practices for user experience and content delivery. In our opinion, mobile and tablet devices and their respective marketing channels should be treated as separate device categories.
So what should hoteliers do to get ready for the year of 3-screen hospitality? Begin by treating the desktop, mobile and tablet as three separate channels:
2. My independent hotel will lessen its reliance on OTAs; my branded hotel will lessen its reliance solely on the major hotel brand for online bookings and will implement a digital marketing plan of its own.
At a time when online travel demand is growing and hoteliers should have more control over their online channel distribution strategies, we are seeing the opposite.
Independent hotels are overly OTA-dependent: Independent hotels have traditionally been easy prey for OTAs due to the lack of understanding of the cost-effectiveness of the direct online channel, ignorance of basic online distribution rules such as rate parity, and weak negotiating power with the OTAs. Last year, more than 76 percent of online bookings for non-branded hotels came from the OTAs and just 24 percent came from the hotels’ own websites (STR, HSMAI Foundation).
Branded hotels are overly brand-dependent: Major hotel brands are doing a good job of brand-building and online marketing at global and national levels, but simply do not have the bandwidth to cover regional, state and local markets or sufficiently address customer segments and feeder markets vital to the property.
This year, independent hoteliers need to lessen their dependency on the OTAs. Rising travel demand means that OTAs’ merchant commissions are shrinking due to push back from the industry as a whole. Contracts with the OTAs are up for renewal this year and the major hotel brands have pushed OTA commissions below 15 percent. Independent hoteliers should not pay merchant commissions above 15 - 18 percent.
Independent hoteliers must budget for a major expansion in their direct online channel efforts in 2013 if they want to decrease their over-dependence on OTAs, the bottom line-killing flash sales sites such as Groupon, Living Social, etc., and last-minute discounters such as HotelTonight.com. Branded and franchised hotels that are over-reliant on their brands’ online marketing efforts are missing out on serious incremental online revenues from local, state and regional initiatives. OTAs should only be utilized as part of a balanced distribution strategy.
3. I will implement a three-silo approach to my 2013 digital marketing budget to maximize my property’s direct online channel presence, ROIs and conversions: core initiatives, business-need initiatives, and capital investments, consulting and operations.
The online channel is where your potential guests are. This year, 94 percent of travelers are accessing hotel information online (Google), and 55 percent of all leisure and business travel bookings will be done online (PhoCusWright). No wonder Starwood announced earlier in 2012 that 75 percent of their brand’s marketing budget would be spent in the digital space.
Yet in 2012, U.S. marketers over-spent some $20 billion in print advertising and under-spent the same amount in Internet and mobile advertising initiatives (KCPB). Furthermore, last year U.S. hotels’ and resorts’ total ad spend was $800 million, yet only $212 million of it was digital ad spend. The hospitality industry needs to re-distribute its marketing dollars to better target today’s travel consumers who have overwhelmingly migrated to the online world. Inertia from the past and lack of understanding today’s travel consumers are the main reasons hoteliers continue to rely on offline advertising formats.
Your 2013 budget should take a three-silo approach and focus on driving direct online bookings by channeling your initiatives into one of three silos: core marketing campaigns, business needs-driven marketing campaigns, and capital investments, consulting & operations.
Read more about the three-silo digital marketing budget approach in the Smart Hotelier’s Guide to 2013 Digital Marketing Budget Planning.
4. I will implement content management system (CMS) technology to better handle website content and marketing across the three distinct distribution and marketing channels.
The explosion of the mobile and social media channels and the emergence of the new tablet channel presented a major challenge to hotel marketers: creating and managing digital content throughout three distinct distribution channels as well as publishing the hotel’s latest special offers and promotions on the hotel’s social media profiles.
Today's hotel website needs fresh content, rich media and current promotions. The hotel's special offers, promotions and packages need to be marketed across the three screens and social media profiles. The hotel’s rich media assets (hi-res photos, PDFs, graphics, videos) need to “feed” all vital marketing and distribution channels. It’s no wonder that in a recent HeBS Digital Industry Pulse Poll, over 91 percent of hoteliers declared their intent to budget for a new property website and design in 2013.
In 2013 hoteliers must implement new CMS technology to store, manage and distribute all of the property’s website content and digital marketing assets as well as circulate special offers and events on the desktop, mobile and tablet websites, and social media profiles. Hoteliers need more than just a simple CMS capable of adding and editing textual and visual content. Developing and building your property website with a flexible, industry-specific CMS is crucial to maximizing revenues and ROIs through the direct online channel. An investment in a highly functional, easy-to-use CMS platform is one that will return your investment tenfold.
What kind of a CMS is best suited for the hotel website? One such example is HeBS Digital’s proprietary CMS Premium, enabled for responsive design on server side (RESS) which employs device-specific modifications to present a customized desktop, mobile and tablet version of the website utilizing the content from the CMS. Built with hoteliers in mind, its long list of functionalities, ease of use and hotel-specific features make it well-suited for hotel websites. One example of a customized feature is the ability to manage a “real-time smart rates” promo tile which features availability and current rates for a particular need period: tonight, this weekend, next month, etc.
5. I will adopt responsive design on server side (RESS) to provide the right website content in the right device category while ensuring maximum user experience.
In this multi-channel, multi-device world it can be difficult to update one website, let alone three different versions of the property website. Many web development shops with no experience in hospitality have been promoting responsive web design (RWD) as the ideal approach to providing an optimal viewing experience across a wide range of devices from desktops to smartphones.
For content-rich websites like the hotel website, it’s not just about providing an optimum viewing experience and fitting the website into different screen sizes. To maximize bookings, hoteliers need to serve the right website content in the right device category – desktop, mobile, tablet – to ensure the best user experience, relevancy of information and conversions. For example, tablet users require deep, visually-enhanced content about the property and its destination.
In your 2013 budget, include an overhaul of your website technology to serve the right website content in the right device category. As discussed in the first resolution, 2013 is the year of the three-screens in hospitality; this is best handled via responsive design on server side (RESS).
Via a RESS-enabled content management system, plan on building and maintaining property desktop, tablet and mobile websites. Many hoteliers serve their desktop website content on tablet devices. However, the desktop website cannot accommodate the touch-screen navigation required by tablet devices along with the high-res photography and highly-visual presentation necessary to display the hotel product in a way that users are quickly becoming accustomed to on tablet devices.
6. I will take full advantage of the tablet channel and provide the best user experience for this growing category of sophisticated travel consumers.
Over the past few years hoteliers have been repeatedly advised to embrace the mobile channel. Industry experts have projected staggering growth rates in leisure and unmanaged business travel bookings via the mobile channel: from $753 million in 2011 to $1,368 million in 2012 (PhoCusWright). Yet a careful analysis of industry stats reveals the majority of mobile bookings, room nights and revenue are generated by tablet devices such as the iPad, Samsung Galaxy and Google Nexus, not by “pure” mobile devices like the iPhone and Android- and Windows Mobile-based smartphones.
Travel consumers on the go use their mobile devices to get concrete information such as hotel location, driving directions and pricing information. Due to usability and security issues, seven of every ten mobile bookings actually happen via the voice channel. Few people are comfortable entering their credit card information into their mobile device in a public place, and few hotel mobile websites provide an alternative to guaranteeing a booking without entering a credit card. In contrast, tablet users have no issues booking a hotel via their device. A well-structured, tablet-optimized website can generate conversion rates several times higher than those of a desktop website merely projected into the tablet channel.
More and more consumers are using tablets to plan and purchase travel, and hoteliers must deliver a customized, user-friendly experience on these devices. One in five Americans will have used a tablet in 2012 – and of this population, more than half reported shopping on their tablets once a week and 12 percent shopped daily (eMarketer).
In 2013, address the rapid growth of tablet users (180 percent increase in Google tablet searches projected this year) by developing a tablet version of the desktop website. By utilizing RESS-enabled content management technology, reward your tablet website visitors with:
Additionally, pay attention to your paid search strategy regarding tablet devices. Don’t just duplicate desktop campaigns — use customized ad copy to drive higher CTRs and conversions.
7. I will implement cost effective ROI-centric marketing initiatives newly available to single independent and branded properties including Google Hotel Finder, TripAdvisor CPC and Kayak CPC.
There are a number of digital marketing initiatives in the direct online channel that generate direct bookings, incremental revenues and high ROIs such as SEO, SEM, email marketing and online media. Over the past several years there have been several other revenue-generating digital marketing initiatives that until recently were only available to OTAs and major hotel brands. Requiring sophisticated CRS technology and out-of-range minimum monthly spends, these initiatives have traditionally been inaccessible to single properties, smaller and mid-size hotel and resort brands and casinos.
One such revenue-generating opportunity is TripAdvisor’s “Show Prices” CPC Program. Over the past few years, TripAdvisor’s “Show Prices” hotel rate shopping functionality became a widely-used travel decision and purchasing tool. Last year alone, the “Show Prices” functionality generated over one billion clicks, making it a powerful distribution channel for all hoteliers. With over 54 million monthly visitors and more than 75 million reviews, it’s clear that TripAdvisor is a cornerstone in the travel industry.
The situation is similar for hoteliers and Google Hotel Finder. Introduced within the past two years, Google has vastly expanded the presence of its Hotel Finder functionality and now you can see its real-time availability and pricing menus in the SERPs (search engine results pages), Google Maps, Google+Local, google.com/GoogleFinder, etc. Requiring sophisticated CRS technology and a real-time availability and pricing data feed, until recently this cost-per-click advertising was only available to OTAs and major hotel brands. The same can be said for the Kayak CPC Program.
Luckily for independent hotels, resorts and casinos, smaller and mid-size hotel brands, there are new digital marketing solutions that can enable your property or group of properties to participate in these important revenue-generating programs. In 2013 you should budget for these opportunities to generate incremental revenue and protect your hotel’s presence on TripAdvisor, Google Hotel Finder and Kayak.com from hijacking by the OTAs.
8. I will enable content personalization on my property website to deliver unique and relevant content to site visitors based on their location, demographics, behavioral or travel intent.
Traditionally, hotel websites have served the same content to all site visitors regardless of their preferences, demographics, and geographic location. Some bigger hotel brand websites provide language, content and pricing personalization based on the user’s IP address to better differentiate their offerings for certain markets (e.g. domestic vs. foreign).
A personalization strategy entails delivering unique and relevant content to site visitors based on their demographics, location, loyalty (returning website visitors), pathing behavior, customer segment (leisure, business, group, etc.), travel preferences and/or reward program affiliation. This strategy takes on various tactics, starting with matching content for those visitors who identify themselves as part of a certain group that warrants targeting via specific content.
Delivering content that is unique and relevant to site visitors is not only pioneering, it will give your hotel an edge. When shopping around for a new website redesign, content personalization must be one of your top priorities. A sophisticated content management system allows personalization on the hotel website while old website technology offers limited content personalization capabilities. Start small by serving differentiated content to your business and leisure travelers.
This type of content personalization on the website will help address a gap in business traveler needs.
In the case of a primarily-leisure hotel trying to expand its corporate clientele, here are some examples for user-specific content that can be served dynamically on the site:
Future content personalization implementations should include integration to Facebook’s OpenGraph, which allows targeting certain demographic characteristics (e.g. gender, age, etc.). Serving your website visitors customized, relevant content will result in higher user engagement and conversions. Now with new sophisticated content management technology available to practically any hotel – small or large – a content personalization strategy should be a must in 2013.
9. In 2013, I will not forget search engine marketing – the workhorse of direct online distribution in hospitality.
Marketers love overlooking tried & true marketing staples in favor of the next big thing – social media, retargeting, mobile, tablets, you name it. HeBS Digital’s own experience shows that more than half of website booking revenue (56% to be exact; 32.6% from SEO, the rest from paid search) across our client portfolio comes as a direct referral from the search engines, including organic and paid search.
Do not ignore the search engines in your 2013 marketing budget! We recommend allocating between 25-30 percent of the 2013 digital marketing budget to paid search. This includes mobile and tablet campaigns. If you follow industry best practices and optimize your campaigns on a consistent basis you can ensure that your SEM campaigns continue to drive high ROIs.
What is the top priority for 2013 as far as search engine optimization is concerned? Creating strong editorial content across the desktop, mobile, and tablet websites. Web content has always been the king of SEO –quality content has taken center stage over the past 18 months, making it imperative to have strong copy supported by a focused SEO strategy.
There is a direct correlation between the quality of the website’s SEO strategy and the results of paid search (SEM) campaigns. The better the SEO on the site, the better the Quality Index assigned to your paid search campaigns by Google which means higher ad position, better conversion rates, higher ROIs and lower cost per click. A robust content strategy, supported by adequate technology and marketing funds, can make all the difference and allow the hotel to maximize its revenues from the search engines.
10. I will partner with savvy digital marketers who can guide me through this process so I can drive record-breaking revenue through my most cost-efficient channel – my property website.
Navigating the online marketplace can be confusing and overwhelming. The pace of change in this industry, including technological advancements, updates to search engine algorithms, and new solutions for driving direct online revenues are almost impossible to keep up with. Hoteliers are rightfully confused by the myriad of headlines about the changing landscape of hotel distribution. Understanding this increasingly-convoluted digital space and complex online travel consumer behavior can feel like a monumental undertaking. Additionally, most hoteliers are already shuffling many different priorities each day and are not able to devote the time needed to keeping up with industry trends and best practices.
Begin by asking your current digital marketing agency several simple questions: Why can’t I manage my desktop, mobile and tablet website content via a single dashboard? Do you employ responsive design on server side (RESS)? How can I personalize content on my website? Can I participate in the Google Hotel Finder program or the TripAdvisor “Show Prices” CPC with a budget I can afford?
In 2013, partner with digital marketing experts who can do all of the above. Experts who will make driving direct online revenues for your hotel their priority, who will keep you up to date with best practices, and who will proactively bring forth ideas to generate the highest website revenues and ROIs while providing your hotel and team with real value, not just a service.
About the Authors and HeBS Digital
Max Starkov is President & CEO and Mariana Mechoso Safer is VP, Marketing of HeBS Digital, the hospitality industry’s leading full-service digital marketing, hotel website design and online channel strategy firm, based in New York City (www.HeBSdigital.com).
HeBS Digital has pioneered many of the best practices in hotel Internet marketing, social and mobile marketing, and direct online channel distribution. The firm has won over 230 prestigious industry awards for its digital marketing and website design services, including numerous Adrian Awards, Davey Awards, W3 Awards, WebAwards, Magellan Awards, Summit International Awards, Interactive Media Awards, IAC Awards, etc.
A diverse client portfolio of top-tier major hotel brands, luxury and boutique hotel brands, resorts and casinos, hotel management companies, franchisees and independents, and CVBs are benefiting from HeBS Digital’s direct online channel strategy and digital marketing expertise. Contact HeBS Digital’s consultants at (212) 752-8186 or firstname.lastname@example.org.
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