Hoteliers – You May Be Spending Too Much Of Your Precious Marketing Budget On Unmeasureable Channels!

Ten years ago, I got to know the owner of a local car wash, and I remember him saying, “one thing great about the car wash business… the internet cannot provide car washes!” Of course, he was right, but what he did not anticipate was competition and how the internet would provide at one’s finger tips the location of all his competitors and their pricing. This would in turn change his margins and profits. And it did.

This is not new news to you as a hotelier. The hotel and tourism business is experiencing change just like many industries thanks to the internet. The internet is providing buyers with information in lightning speed and in a depth never imagined. What may be viewed as great opportunity may also feel like a curse. For airlines, hotels, golf tee times, and other similar businesses it seemed like a godsend when the ability to sell off unused inventory was instantly provided. The variable cost was minimum to the revenue gain. Or at least that is what everyone felt was the gain.

But low and behold, now years of training consumers to be “price shoppers” who are savvy internet users that they can find the same level of quality, in the location they want, for less than they would have paid in the past. This strategy of providing your hotel as part of the OTA’s world has become a two-edge sword. What is it that you have the OTA’s do not?

The Future is Now – A Brief Comment on The Booking Landscape

Here are some startling statistics on the travel industry:

•      The world’s travel industry is worth more than $2.5 trillion USD and is currently the fastest growing sector.

•      There are more than 10 million searches related to travel carried out in Google Search per month.

•      Based on 10 million searches, an estimated 3 million visits are going into top 10 OTAs alone.

• is the leading travel site and OTA for the industry. In 2016 year alone, it generated almost 1.1 billion visits to its site.

•      Expedia spent 4.3 Billion USD in advertising alone in 2016, an increase of almost 1 billion USD from 2015.

•      Priceline Group spent $3.5 billion on marketing. Priceline Group consist of, Priceline, Agoda, Kayak and many more travel related companies.

•      85% of travellers said PRICE is the most important factor when determining where to book according to a survey by Google.

No wonder travel companies find it hard to compete with the Priceline Group – the company splashed out a record $3.5 billion on marketing last year. Google was most likely the primary recipient of the company’s eye watering ad spend.

‘Content marketing’ isn’t just a buzzword; it’s the key to selling anticipated experiences. Luxury hotels, typically with higher-than-market ADRs, need to ensure they tell a story that will entice consumers to spend more and book stays at their higher-end properties. Painting a picture with a story engages consumers, and the only surefire way to capture all potential consumers is to utilize a multi-channel approach to digital marketing.

The average travel consumer’s journey to hotel reservations takes about 17 days, and includes eight research sessions, 18 website visits, and six clicks before a booking is confirmed. Users go through 15.5 touch points just within the week before they actually make their hotel reservation (Google, eMarketer).

An independent property or regional hotel brand can’t outspend an OTA to acquire traffic. Instead, a hotel needs to focus on the channels preferred by its customers, and target the personas that best fit the hotel’s operating profile. It is critical for smaller, regional hotel groups and independent properties that lack access to the resources of large brands or management companies to secure the expertise from digital agencies, distribution technology partners, strategic consultants or staff specialists to address their specific needs.

Individuals Command Greater Control Over Their Personal Travel Decisions, Why?

The luxury travel consumer has higher spending power, and is expecting a personalized experience, not just upon arrival at your hotel, but while on the purchase journey as well. Many luxury hotels have dedicated concierges and attachés available on-property at a guest’s leisure, but what if your website could offer a similar experience online?

What if your website could display the most enticing special offer to a user based on his past browsing history on the site? What if your website could remember a user who booked in the past and is part of a loyalty program, addressing him by name? What if you could upsell amenities and ancillary revenue for the hotel by showing someone who is interested in dining the restaurant mini-site right away? All are possible through a Smart Personalization Engine.

Not only will having personalized content allow the luxury hotel’s website to stand out amongst competitors and OTAs, it will also allow for the travel planning journey to reflect that personalized on-property experience. Additionally, studies have shown that companies that personalize content report uplifts of over 40% in sales (Forrester).

To address the proliferation of customer and business data, we’ve developed Business Intelligence (BI) – to focus on collecting as much data as possible on customer behavior, buying patterns and even cancellation or lost sales data. The important part is what comes next. Big data is all well and good, but it is how you use this data that will truly propel your business forward. We call this predictive analytics.

Predictive analytics is about:

•      taking the data

•      analyzing it

•      using it to predict future business levels, customer behavior and demand.

With the rapid growth of online travel retail and review sites, the hospitality industry has a wealth of data to mine to find such patterns. The customer now crosses between devices and touchpoints as they go through their daily lives. From the radio or tablet in the morning, to smartphone on their commute, onwards to desktop and telephone during the working day and back, via smartphone, tablet, TV and laptop at the day’s end.

This provides a wealth of data, and countless two-way communication options. For a data-rich industry, such as travel, predictive analytics presents a whole host of opportunities.

Principally, it is best used to:

•      predict trends

•      understand customers

•      improve business performance

•      drive strategic decision making

•      predict future behaviors

Smart hoteliers are already realizing this. Integrated resorts can use predictive analytics to promote and price a wide range of downstream ancillary services. By knowing who will be visiting your hotel, and what their demographics, interests and potential spend are, hotels can predict how to promote and price spa treatments, golf tee times, shows and entertainment options for a better ROI and impact on their marketing dollars.

Data, Data Everywhere. Where Do I Start?

Of course, as in most industries, a majority of analytical work in the hospitality industry is focused on marketing. The overall aim is often to launch personalized marketing campaigns in the form of email or targeted social media advertising. This involves analyzing all of the information available about customers who are visiting, by gathering customer feedback, transactional activity, use of loyalty programs and bought-in third party demographic data. This is then used to decide whether, for example, an offer of a free restaurant meal, or a ticket for a show at a nearby theatre is more likely to persuade a high lifetime-value customer to make a booking.

So, what then is important or critical data that you should consider capturing or analyzing to help build a picture of who your buyer persona is. Here are just some of the most traditional and basic data you can capture:

•      Country of origin.

•      Booking channel.

•      Time of booking (seasonal changes).

•      Lead time.

•      Room rate for the booking.

•      Type of room booked.

•      Length of stay.

•      Responses to marketing campaigns and discounts, e.g. direct email marketing.

•      Competitor performance (ADR, occupancy, etc.).

•      Destination data (tourist arrivals, tourist expenditure, room nights).

As stated previously, your customer is more switched on and plugged in than ever. This means they are more educated on what is out there and what price is competitive. For hotels, following the new age of social media is vital to stay front of mind and price sensitive with clients. New data sources are coming to the fore continuously, and include:

•      Social media – listen to what the market is saying about you and your competitors. Watch for spikes in traffic and analyze this: is it the result of a marketing campaign by you, a competitor or your destination?

•      Review data from sources such as TripAdvisor, Priceline or Orbitz

•      Customer data from other sources for purchases in other sectors.

•      Search engine traffic (Invest in SEO) – use Google Analytics to see where your web traffic is coming from.

The expression ‘possession is nine tenths of the law’ is a great way to highlight why business silos get built and are so fiercely protected. Business managers and department heads are often reluctant to share data, for fear that by letting the data go they will lose possession, lose control, and lose out. As mentioned, the hospitality and travel industries have large amounts of data, but historically there has been a lack of co-ordination between hotel departments, individual hotels and even hotels within the same chain or group. Even the databases used by hotels create silos. Customer relationship management (CRM) systems, reservation systems, and loyalty and marketing programs rarely work with revenue management and sales platforms. Hotels need to invest in cleaning up their data and link-up guest profiles across these various databases. It is only by taking a combined approach to data mining that the statistics can paint a true picture, and present customer analysis and meaningful insights. This is the forte of Response Marketing Group, invest in your data to grow your bottom line.

As with every other aspect of the hotel business, one size does not fit all. The largest travel websites are collecting massive amounts of information in big data storage for future reference by machine learning and predictive analytics algorithms. While such operations are costly to develop, maintain and staff, even the smallest independent hoteliers are able to reliably capture essential information using free platforms, the most widely used being Google Analytics.

A variety of digital marketing hubs are available at a range of price points, each with its own unique features and limitations. The most important consideration is to select a platform that will reliably protect the data and support analysis, while enabling growth and future enhancement as programs and performance measurement needs become more sophisticated over time. For most hotels, the core data sets will involve tracking visitor statistics, navigation paths and events from the hotel’s website;

•      sales transactions from booking engines or the property/central reservation systems (PMS/CRS)

•      inventory and pricing from the revenue management or channel management system

•      guest profile and stay history from a CRM platform

•      social media referrals from a reputation management platform

Some hotels will support all these systems, others may only use a PMS. The key to success is not having more systems, but capturing accurate information from available systems to understand guest needs and preferences.

“Good data beats good algorithms, every day of the week.”

Chief Information Officer | Major OTA

For hotels just starting out, the key is to start simple, capturing basic information related to business goals and key performance indicators (KPIs). The objective is not to collect data; it is to gain insights, thus the importance of capturing goal-related performance data. Once basic reporting and analytics are produced, new data sources may be gradually introduced and integrated, assuming support for an extensible data structure.

Thanks for reading and check back soon or email me to receive Part 2 of “Tapping Your Best Commodity”.


1) – Bringing Predictive Analytics To The Hotel Industry

2) Phocuswright – Parsing Shop and Book 2016: How OTAs, Airlines and Hotels Compete on the Desktop and Mobile Web and ADARA

3) Phocuswright – Channel Optimization in Hospitality: Secrets of Data-Driven Hoteliers, March 2017

4) – Direct Booking VS. Online Travel Agency. What Hotels Need To Know in 2017