News for the Hospitality Executive
By: Neil Salerno – December 2010
Electronic channels have changed hotel sales and marketing forever. Internet website marketing, social media, the Global Distribution System, and third-party aggregators have all presented new marketing opportunities to hotels around the world. In effect, the Internet has created the first affordable global marketplace for large and small hotels everywhere.
For a while, it appeared that the Internet would be a simple answer to everyone’s occupancy problems; an inexpensive and effective way to sell rooms. All one needed was a website. However, as Internet marketing matured and search engine technology evolved, design requirements for websites have also matured; even simple websites must follow search engine rules. After all, a website needs traffic to be effective.
A dedicated proprietary website will produce incremental room business with an incredible return on a modest investment, but not without some effort. Tags, links, and properly written text are the key components of a producing website, yet many web masters cannot produce these on their own. Knowledge of hotel marketing techniques is a big plus. A website is not an online brochure; it should be an interactive online sales tool. Knowledge of how and why consumers select accommodations is essential to the site’s design.
In the past couple of years, many hoteliers worldwide have contacted me citing their disappointment with their professionally designed website. Many of these sites lack basic hotel marketing expertise, while others are dysfunctional because of zealous designers who are more interested in creating a masterpiece than creating a site, which markets their hotel. Content is king; yet much of their site’s text lack a focused search and hotel sales theme.
Many hotel websites, unfortunately, are the result of “committee” input, which usually result in over-complicated, difficult to navigate, confusing, and ineffective websites. Knowledge of how search engines find and rank web sites is essential. There is much more to website design than that which one sees online. This internal construction has much to do with the eventual popularity of the site. Increased popularity relates to increased reservations.
Social Media Participation
Social media has played an important role in hotel electronic marketing, but it is important to prioritize your efforts. FaceBook and Twitter, used properly and consistently, can help boost traffic to your website through keywords and links, but the most under-utilized, yet most important social medium is TripAdvisor.
Data shows that at least 70% or more travelers will check your standing on TripAdvisor either before or after making a hotel reservation. Yet, we see a distinct lack of use of the TripAdvisor widget on hotel websites.
There are two ways to accomplish this; the right way and the wrong way. We have seen many hotel sites which have inserted the widget on their sites, but that is all they have done. The right way to get results and experience the full impact of the widget is to create a separate landing page with a good variety of guest comments, which resides directly on your site. This way, travelers can read your guest comments without leaving your website. The actual link to your TripAdvisor page resides on this page.
Global Distribution System
Unlike many of today’s naysayers, I believe that travel agents will continue to play an important role in leisure travel for a long time to come. As people begin to feel the personal disconnect that electronic marketing creates, I believe that many travelers will increasingly return to the personal touch that only travel professionals can provide.
The GDS may never possess the same popularity it once enjoyed before the Internet, but I believe that many travel agents will adapt to their new role in leisure travel. At this point, the GDS can still supply your hotel with needed, often rack-rated room business. The GDS is your hotel’s connection to travel agent bookings.
Many franchised hotels did not take much notice to changes in GDS business, because most franchises control GDS submissions for their franchisees. However, if you have an independent hotel, the GDS connection can be made through one of several GDS providers. It is very cost-effective and can be very rewarding. The Global Distribution System was the first breakthrough in electronic marketing; many years ago. It enables travel agents and airlines to see real-time rate and inventory availability for your hotel. The amount of business, which is transacted through GDS, is still significant.
I have written many articles in the last few years about the battle between hotel franchises and third-party aggregators. I am happy to say that their fight for Internet superiority has settled into some positive forms of mutual co-operation. If true, this is a welcomed turn of events, which will benefit the entire industry. With the unique ability to package air travel, car rental and hotel rooms, third-party aggregators captured a niche on the Internet. They are here to stay.
True, some data shows that many travelers prefer to deal directly with suppliers, rather than a third party, but the convenience of one site transactions appeal to many Internet savvy travelers. Third-party marketing techniques on the Internet appear to have no equal. Third-party marketers dominate the vast majority of organic web search results. This is no small feat and very costly. Moreover, they are selling your hotels.
In spite of what you might be hearing from your franchise, third-party aggregators are capable of producing solid base business for your hotel. You have been hearing for months that only about 20% of hotel web searches are brand specific. Can you really afford to put all your marketing eggs in one franchise basket?
Independent hotels have even more to gain from creating a sales alliance with third-party sites; in addition to more room nights, they could receive needed sales exposure on the Internet. Although the exact numbers are fuzzy, many people feel that at least 80%, or more, of all hotel reservations are first researched on the Internet. The additional exposure provided by third-party sites is invaluable, especially for Independent hotels.
The strongest third-party sites command primary search results on sponsored pay-per-click searches in almost every primary, secondary, and tertiary market. These sites provide needed exposure for all hotels. Anyone familiar with pay-per-click knows that there is considerable expense involved in this type of marketing. Anyone questioning the true value of third-party sites needs to get on the Internet and perform a few web searches.
Balanced Electronic Marketing
Creating a balance among website marketing, exploiting the GDS, and creating a partnership with third-party aggregators will produce results. As we enter 2011, electronic marketing is a key to success.