Distribution falls into two camps – third party and direct. Each one has huge benefits, and potential challenges. Keeping a keen eye on both is essential to ensuring healthy profit margins. Likewise, having a solid understanding of how effective digital marketing can support both will ensure those healthy margins are maintained.
There is massive value in each channel. Third parties can quickly reach audiences you may struggle to do alone. They bring a community who trusts them and often user-friendly websites.
Previous research from Tripadvisor found that over half (57 percent) of people use an OTA to help plan their travel. Based on this statistic, it might be fair to say then, that if you ignore OTAs and aren’t visible on them you could be ignoring a large portion of the market. A dangerous approach.
However, when you go direct to the customer, you can often offer a more tailored experience, own the data and insights behind the booking, and enjoy nurturing a long term and fruitful conversation into the future. In this approach, often a hotel website is its shop window – it’s where you create an all-important first impression and from where guest communication can grow.
So, how and what should hoteliers be doing to convert an interested party to a confirmed guest and maximise all opportunities to drive additional revenue during a stay and even after checkout?
1. Keep your website simple
Make sure your website is easy to navigate and has all the key information – lowest room rates, location, facilities, and an all-important online booking facility – available at a glance. At the same time, it needs to be inspirational. Next to attractive room rates, strong photography is also one of your key assets and the best way to showcase your property. The shift towards mobile is ever-increasing, and as a result, you need to invest in ensuring that your website not only appeals but also works across smartphones and tablets to deliver bookings. That means limited scrolling and instant, easy-to-load images.
2. Get sociable
Facebook, Twitter, and Instagram are all important channels that can deliver engagement with your guests, encourage brand loyalty, and boost your profile online. They should be an integral part of your digital marketing strategy. Make it easy for guests to subscribe to a newsletter, for example, to receive limited edition deals. Ensure your posts are fun and informative, but not too focused on sales messages and room rates. Inject some personality into your social media and make sure you are posting and engaging regularly.
Just like a website, social is also a way to communicate with guests and manage and reinforce great customer service. But be warned, don’t ignore negative comments – ensure you are responding in a friendly, timely, and professional manner and you have the potential to build long term and valuable relationships with your guests.
3. Put a price on the true cost of distribution
Putting a price on the true cost of distribution can be hard. Marketing, training, e-commerce investments, preferred partner agreements and more – they all add up. It is impossible to address the true value of your distribution mix, if you are not aware of all of the sums of the parts. Understanding the return on investment in digital marketing is also key to this analysis.
4. Find the right technology partner
Find the right technology partner who can help you adopt a more strategic approach to driving down the cost of distribution. Businesses like Guestline and their revenue management tools can ensure, that you implement and maintain a programme of regular reviews of the various channels. The right technology team will also empower you in planning how to utilise each channel to its full cost potential, and to track your investment in direct booking channels to ensure they are all working the hardest for you and delivering the greatest return on your investment.
5. Put your OTAs and channel partners under the spotlight
Put your OTAs and channel partners under the spotlight and be sure to read the fine print of any agreement. Undertake a comprehensive view of your current commercial terms to see where any fat can be trimmed off – particularly across costs that lie outside of commissions. Couple this with a competitor analysis review on these channels. How do you fare in comparison? Can your profile be improved? To ensure maximum visibility, it is tempting to work with a large number of different channels, however, if they aren’t benefitting the bottom line, it might be time to reduce this roster and focus instead on fewer partners. Sometimes, less is more.
6. Have a clear strategy on how to work with them
Once you’ve taken a more forensic approach to examining your OTA terms and conditions, make sure you have a clear strategy in place for how best to work with them. Track how sales are performing, what your availability looks like, and if indeed you also need to keep some inventory back for other channels. Be sure your website offers the same best rates as the OTAs and that you have a digital marketing strategy in place to support this. Consistency across pricing is key.
7. Implement a direct booking strategy
Investment in the direct channel will also pay significant dividends in the long run. Implement a direct booking strategy that will ensure guests fully understand the benefits of booking direct. Data capture will inform and support this and enable you to market effectively to guests to encourage valuable return direct bookings. Social media can also have an important role to play here in making your brand something to stay in touch with.
In conclusion – The future of distribution is both exciting and complex. There are bigger and bigger players to contend with, and an ever decreasing guest attention span. Guests are demanding greater personalisation, are increasingly comfortable to engage with AI, and savvier about value than ever before. The greatest investment in future distribution that hoteliers can make is time to assess where the best value is being delivered to your business and the development of effective digital marketing strategies to ensure all channels are utilised and all revenue opportunities are realised.
Established in the UK, Guestline provide innovative property management, channel distribution and digital marketing solutions to the hospitality industry. Founded on cloud-based technology, Guestline’s revenue generating solutions enable hotel groups, independents, serviced apartments and pub companies to achieve maximum occupancy at the most profitable rate.
Fully integrated into the Guestline distribution and central reservation platforms, the property management software is currently growing revenues in businesses in 20 countries across five continents. The range of products include Rezlynx PMS, online booking, CRS, channel distribution software, PCI compliance, EPoS and digital marketing solutions.
For more information, please visit: www.guestline.com
About Rupert Gutteridge
Rupert is the Sales and Marketing Director at Guestline, managing the Sales and Marketing team in the UK. He is responsible for the continued international development of Guestline across the Asia-Pacific region. Rupert has over 20 years of experience in the industry; he previously worked as Regional Sales Director at IDeaS and also Sales Director – Central Systems, EMEA, for MICROS Fidelio. Prior to this he was with AremisSoft Corporation in both the UK and United States.
To connect with Rupert on LinkedIn, please visit: https://www.linkedin.com/in/rupertgutteridge/.