How to Connect with Travelers to Drive More Direct Hotel Bookings
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- Rafe Potter
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1 How to Connect with Travelers to Drive More Direct Hotel Bookings Guide Managing Guest Satisfaction Surveys: Best Practices
2 Index Introduction Trends in Digital Hotel Marketing Trend #1 Trend #2 Trend #3 Strategies to Drive More Direct Bookings Key Hotel Marketing Strategies Using Technology to Engage Guests Top Tips for Communicating with Guests Leveraging Technology to Drive Direct Bookings & Guest Loyalty Big Brands Leading the Change Check-in via Mobile Apps Improving Website Conversion Rates Success Story: Opus Hotel About Us Managing Guest Satisfaction Surveys: Best Practices
3 Introduction As more intermediaries get between you and your guests and technology increasingly digitizes the guest experience, building direct relationships with guests has never been more challenging or important for hotels and brands. In this guide we discuss how hotels can utilize technology to connect with travelers before, during and after their stay to enhance the guest experience and drive more direct bookings, profitability and guest loyalty. Managing Guest Satisfaction 3 Surveys: Best Practices
4 Digital Hotel Marketing Priorities What s your highest priority in digital marketing? During ReviewPro s recent webinar, Connecting with Travelers to Drive Direct Bookings and Loyalty, we asked attendees what their highest priority is in digital marketing today. Of the hundreds of hoteliers in attendance, 63% named more direct bookings as their highest priority. Clearly, if this is a priority for your hotel, too, you can rest assured that you are not alone! Which of the following is the highest priority for you today? Getting through this webinar without being interrupted More engagement on social media channels Better traveler reviews and ratings 9% 1% 16% More direct bookings 63% More bookings from online travel agencies 1% 0% 20% 40% 60% 80% Managing Guest Satisfaction 4 Surveys: Best Practices
5 Trends in Digital Hotel Marketing Managing Guest Satisfaction Surveys: Best Practices
6 Trend #1: Consolidation & Growth Among OTAs To stay competitive, it s important to stay current with changes in traveler behavior and technology. The year 2015 has seen a number of dramatic changes in the online travel space that have had a direct impact on the ability of hotels to attract direct bookings. In recent years there has been tremendous growth and consolidation among online travel agencies (OTAs). In September 2015, the U.S. Justice Department approved Expedia s 1.3 billion merger with Orbitz. When combined with previous acquisitions, including Hotels.com, Travelocity, Trivago and Wotif, Expedia is now the world s largest online travel services company by bookings. Meanwhile, Priceline too has been on a buying spree and now includes Booking.com, Agoda, Kayak, OpenTable and digital marketing services company BookingSuite, formerly Buuteeq, among other brands. Both of these companies have seen tremendous growth in recent years. Priceline s market value is now about U.S. $70.5 billion, and its shares have increased by almost 7,000% in the past decade and by 20% in the past year alone. Meanwhile, Expedia has performed even better; its stock price is up by 50% this year. Growth and consolidation is not good news for hotels seeking to lower their dependency on OTAs. It means less competition among OTAs, greater market share and more power to negotiate with hotels. According to PhoCuswright, as of late 2014, when combined Expedia and Priceline account for 94% of the OTA market in the U.S. However, travelers still use a variety of channels to book hotel rooms. Online travel agencies account for only about a third of the online travel market and generate just 16% of total U.S. gross bookings. Managing Guest Satisfaction 6 Surveys: Best Practices
7 Trend #1: Consolidation & Growth Among OTAs Granted, a certain degree of bookings from online travel agencies is desirable for hotels, helping to fill rooms that may otherwise go empty. There is also the so-called Billboard Effect - many travelers see hotels on OTA listings and then book direct. But OTA business comes with a cost. Not only do OTAs charge relatively high commissions, ranging from 12% to 30% of room rates, they dominate paid search results, bidding on hotel brand names, driving up cost-per-click rates and increasing the overall costs of acquisition for hotels. OTAs also have a commoditizing effect on hotels, leading to less brand loyalty among travelers and more booking decisions driven by price. Travelers often don t know that they re booking through an OTA and don t understand that they may benefit from booking direct. Source: Traveler s Road to Decision, Google, 2014 Managing Guest Satisfaction 7 Surveys: Best Practices
8 Trend #1: Consolidation & Growth Among OTAs Why do travelers book on OTAs? In a survey of 5,000 U.S. travelers in 2014 conducted by Ipsos MediaCT on behalf of Google, respondents indicated that their top reasons for booking on OTA sites included: Best Price Guarantee on hotel bookings. If you find a better price on exactly the same stay elsewhere we ll match it Lower prices or better deals Past positive experience or recommendations for the site Familiarity with the brand name of the site Better tools and options on the site Loyalty and rewards programs It s what came up at the top of a search engine results It s important to understand why travelers book through OTAs because it provides insights into what it takes for hotels to compete. Clearly there is a perception among travelers that OTAs offer lower prices and better deals. Managing Guest Satisfaction Surveys: Best Practices 8
9 Trend #2: The Rise of New Intermediaries Another important trend is the rise of new intermediaries like metasearch engines and new instant booking features on TripAdvisor and Google. In some respects the emergence of these players is good news for hotels because they act as competitors to the Priceline-Expedia duopoly and give travelers more booking choices. For hotels they provide new distribution channels. At the same time, the distribution landscape has become even more complex and fragmented. With limited time and resources, hotels must be highly strategic about where they invest their time and marketing budget. Metasearch Engines Metasearch engines like Kayak, Trivago and Skyscanner have been around for a while now, allowing travelers to compare hotel rates from a variety of sources on one page, including OTAs, direct channels and other third-party resellers. Originally they operated on a cost-per-click model but recently Kayak and Hipmunk have begun to offer a direct booking option as well. Hotels can bid on placement in metasearch engine results but currently paid results are dominated by OTAs and big brands. TripAdvisor for Hotels: How to Drive More Reviews, Referrals & Revenue TripAdvisor has never been more integral to the success of hotels. In this webinar our panelists, including Brian Payea from TripAdvisor, bring you the latest industry news, research and tips from TripAdvisor and show you how to boost your hotel s ranking while driving revenue. Watch Webinar Managing Guest Satisfaction 9 Surveys: Best Practices
10 Trend #2: The Rise of New Intermediaries TripAdvisor Instant Booking TripAdvisor has been busy rolling out its new Instant Booking product, which allows travelers to book rooms without leaving the site or mobile application. Hotels can bid for placement based on a commission model of between 12-15%. When a traveler selects a hotel, TripAdvisor passes the booking on to the hotel to complete. Many of the major hotel groups have joined Instant Booking, including Accor, Marriott, Carlson Rezidor, Best Western, Choice Hotels, Wyndham and Preferred Hotels & Resorts, as well as numerous independent hotels. According to TripAdvisor, more than 235,000 properties now participate in the Instant Booking program. OTAs initially refused to participate, but in October 2015 Booking.com was the first major OTA to announce that it will be joining the program. As of September 2015, TripAdvisor Instant Booking was available to all users in the U.S. and the U.K. The company plans to roll the program out internationally. For more information visit TripAdvisor. Source: TripAdvisor Managing Guest Satisfaction 10 Surveys: Best Practices
11 Trend #2: The Rise of New Intermediaries Google Hotel Ads Commission Program Google recently announced that it has retired its HotelFinder product and is integrating more booking capabilities and amenity information into search results. Google s new Hotel Ads Commission Program allows hotels to bid on placement based on what it terms as industry standard commissions on actual bookings rather than the usual cost-per-click model. These commissions are reportedly similar to TripAdvisor s, at between 12-15% of room rates. As with TripAdvisor Instant Booking, Book on Google allows travelers to book hotels right from Google; Google passes the booking on to the hotel for completion. future. Book on Google is currently available to all Hotel Ads partners and works for users in the U.S. only. The program is expected to be rolled out internationally. For more information visit the Google Blog. Google currently works with DerbySoft, Fastbooking, Sabre, Seekda, TravelClick and Trust International and has plans to integrate additional technology providers in the Source: Travel Flash Report, Criteo, 2015 Managing Guest Satisfaction 11 Surveys: Best Practices
12 Trend #3: Growth in Mobile Bookings Another major trend is the use of mobile devices by travelers to research and book trips. Criteo, a leading performance advertising technology company, has analyzed over one billion travel bookings worldwide, and its recent Travel Flash Report indicates that the share of mobile travel bookings compared to desktop bookings has almost doubled in the past year, from 12% to 23%. When it comes to mobile hotel bookings, the share of OTA bookings generated from smartphones is about three times higher than bookings generated by hotel suppliers, according to Criteo. So here again OTAs are taking the lead. Seasonal growth of mobile bookings worldwide in H Mobile bookings are growing faster than desktop Tablets and smartphones accounted for most of the growth of the online travel industry, worldwide, across all categories and markets in H1. Overall, there was a 20% increase in bookings from mobile devices, compared to just 2% growth in desktop bookings. Source: Travel Flash Report Managing Guest Satisfaction 12 Surveys: Best Practices
13 Strategies to Drive More Direct Bookings Managing Guest Satisfaction Surveys: Best Practices
14 Key Hotel Marketing Strategies So how can hotels keep on top of these trends and utilize new tools and technology to drive a higher volume of lower-cost, higher yield bookings? Here are some key strategies to consider. channels, but consider the costs of cost-per-click bidding and other expenditures used to attract and service this business. Once you understand where your greatest profits are, invest more resources in these channels. Diversify distribution Experiment with listings and advertising on new channels like metasearch and instant booking on TripAdvisor and Google, where commissions are lower than OTAs, and they pass the booking on to your hotel, enabling you to manage the guest relationship almost from the beginning. Calculate and compare the costs of acquisition Analyze the costs of each channel and the value of the guests they generate in terms of rate, length of stay, total spend and profitability. Direct bookings on your website may appear to be highly profitable compared to other Manage relationships with OTAs You ve heard it before, but part of the reason OTAs have become so powerful is because hotels agree to terms that are not in their best interest. Hotels give OTAs liberal access to inventory and allow them to offer lower rates than those available through direct channels. It s critical to control both the price and the volume of rooms you make available to OTA channels, to reduce dependency, to review OTA contracts carefully and to negotiate the most favorable terms possible. Most importantly, ensure that OTAs never undercut your direct-booking rates. Managing Guest Satisfaction 14 Surveys: Best Practices
15 Key Hotel Marketing Strategies Be mobile friendly As more travelers turn to mobile devices to research trips, communicate with hotels and share experiences, your hotel needs to adapt with the times. This means ensuring that your website is mobile friendly and giving guests the option to communicate with your hotel and provide feedback on mobile devices. Focus on guest service Expedia, Priceline and Google are technology companies that invest their money in marketing and technology; they can t compete with hotels when it comes to customer service. The better your service and the higher the quality of the guest experience, the more likely your guests will come back, book direct and recommend your hotel. This includes ensuring that phone lines are adequately staffed in order to capture all those booking inquiries from smartphones. Collect, analyze and use data The volume of data available related to traveler behavior and preferences is virtually unlimited, but you ll need to invest in tools and training to make sense of it. Tools like ReviewPro will help you aggregate data, analyze it for actionable insight, and use it to personalize marketing campaigns and the guest experience. Display review scores and guest survey scores on your website to show transparency, increase traveler trust and drive a higher conversion rate. Utilize available tools and technology A variety of tools are available to help hotels connect with guests on mobile devices, increase conversion rates on your website, offer pre-stay and in-stay services, and solicit in-stay and post-stay feedback. We discuss how hotel companies are utilizing some of these tools in the next section. Managing Guest Satisfaction 15 Surveys: Best Practices
16 Using Technology to Engage Guests How Can Hotels Better Communicate with Guests? Another key strategy for driving direct bookings and guest loyalty is to utilize digital technology to engage guests prior to arrival and during their stay. Here Drew Patterson, Co-founder and CEO of CheckMate, shares his top tips for leveraging mobile technology to communicate better with guests. CheckMate, a ReviewPro partner, builds hotel communications tools to deliver a better guest experience from before check-in through to departure by any means of communication - , text or native app. Drew Patterson CEO CheckMate Managing Guest Satisfaction Surveys: Best Practices 16
17 Top Tips for Communicating with Guests As part of our Webinar, "How to Connect with Travelers to Drive Direct Bookings & Loyalty", Drew Patterson shared his top tips for communicating with guests: Enable messaging via today s channels (SMS, , social, app) before, during and after stay. Use pre-arrival messaging to initiate conversations. Conduct in-stay service alerts to identify service issues. Support multiple forms of expression (text, images, emoji, maps, documents, forms). Reach all guests (e.g. direct, corp, group, wholesale, OTA). Extend the personal touch (i.e. hospitality) into mobile channels. Create a single, shared in-box for the customer-facing team. Provide operational CRM profiles for front-line employees. Key Trends & Strategies for Hotel Marketers in 2015 Download our guide to hotel marketing trends in 2015 to discover tips by leading industry experts to improve your marketing activities and results. In this guide we discuss visual shopping, mobile strategies, retargeting, metasearch sites and much more. Better communication with guests, Patterson says, results in better guest experiences, greater guest loyalty, stronger TripAdvisor scores and more direct bookings. Download Guide Managing Guest Satisfaction Surveys: Best Practices 17
18 Leveraging Technology to Drive Direct Bookings & Guest Loyalty Managing Guest Satisfaction Surveys: Best Practices
19 Big Brands Leading the Charge Now let s look at examples of how hotels and brands are utilizing technology to drive higher engagement with travelers, more direct bookings and greater loyalty. When it comes to investing in new technology, big brands are leading the charge. While you may not have access to big budgets like they do, it s important to watch what they re doing in order to understand where the industry is heading. You can strive to follow their lead in smaller ways. Here are a few examples of recent technology initiatives. Today Accor brands operate 29 mobile solutions, but the company is in the process of reducing this to one mobile app for all brands and locations in their portfolio. In addition to offering bookings capabilities through the app, the company offers a number of guest services, including digital check-in, in-stay services, local information and newspapers. Accor plans to digitize the entire guest experience in an effort to get more travelers to download and use its app. Accor Hotels In October 2014, French conglomerate Accor Hotels introduced its five-year, 225 million euro plan for reinventing the customer experience through technology. The plan includes major investments in mobile marketing. The company reports that more than 30% of its audience is mobile and about 12% of its direct web sales are generated by mobile, having increased by 60% in the first quarter of 2015 alone. Managing Guest Satisfaction 19 Surveys: Best Practices Also worth noting is Accor s acquisition of digital marketing company Fastbooking and the opening of its website to independent hotels. This gives independent properties the opportunity to access Accor s sizeable audience of travelers and to offer Accor loyalty points at lower commissions than those charged by OTAs while still maintaining their independence.
20 Check-in via Mobile Apps Hilton Hotels Starwood Hilton s HHonors mobile app allows loyalty club members to search, book and modify their stay as well as use loyalty points. Hilton hotels in the U.S. now offer digital check-in, allowing guests to select their exact room prior to arrival. The company expects to roll out these services worldwide. The Hilton mobile app is used by over one million people per month. Starwood s SPG Keyless program allows loyalty members to use their smartphone and their Apple Watch to check in, get their room number and unlock their door. Iphone App Apple Watch App Managing Guest Satisfaction 20 Surveys: Best Practices
21 Improving Website Conversion Rates Marriott Jury s Inns Marriott is testing out beacon technology in some of its hotels to push out on-property offers and information specific to the hotel. Beacons are small transmitters placed on property that send push notifications to anyone who is signed into a dedicated app and comes within a certain distance. Marriott is also educating travelers that the best deals are found by booking direct and providing strong incentives through its It Pays to Book Direct campaign. Jury s Inns, which operates 28 hotels in the U.K., Ireland and the Czech Republic and is reputed for offering great value and warm, friendly service, displays both TripAdvisor scores and guest survey scores from ReviewPro s Guest Survey Solution on listings of all properties on its brand website. This creates greater traveler trust and results in higher conversion rates. Managing Guest Satisfaction 21 Surveys: Best Practices
22 Success Story: Opus Hotel Opus Hotel So what can you do if you re a small hotel with a relatively modest budget? Here Nicholas Gandossi, general manager of the 96-room Opus Hotel in Vancouver, shares how his hotel utilizes technology to build engagement, loyalty and direct bookings with travelers. Rated Four-star by Forbes and named one of the Top 5 Trendiest Hotels in the World by TripAdvisor, Opus Hotel redefines the boutique hotel experience, with vibrant design, sophisticated style and intuitive service. The Challenges Earlier this year, Gandossi and his team identified the following top strategies for 2015: Increase the amount of direct bookings on the hotel s website Gain a higher level of engagement with guests Build brand loyalty Nicholas Gandossi General Manager, Opus Hotel Managing Guest Satisfaction 22 Surveys: Best Practices
23 Opus Hotel s Top Strategies 1. Increase Direct Bookings To increase direct bookings, Opus knew it had to find ways to keep travelers from leaving its website to shop around and to encourage them to book direct. This required building trust with travelers and giving them the confidence that they get the best rates by booking direct. To help advance this goal, Opus invested in a software tool called Triptease, which displays a widget on hotel websites listing rates offered on various OTAs, much like a metasearch engine. Opus also uses software tool Guestfolio to manage campaigns and to target guests who booked through an OTA with an offer of a 10% discount to return and book direct. connection. To advance this strategy Opus turned to CheckMate, to enable them to connect with guests prior to arrival and during their stay via mobile technology. 3. Build Loyalty The third goal for Opus Hotel was to create compelling reasons for guests to return and to become brand advocates. To help achieve this goal, they put added focus on providing a memorable experience and being unique and fresh with product offerings and services. TripTease Widget 2. Increase Guest Engagement Another strategy for Opus Hotel was to We further will develop engage a solution to any concern raised. with guests at different touch points in the travel journey. The hotel wished to personalize the digital relationship with its guests and create reasons for a stronger Managing Guest Satisfaction Surveys: Best Practices 23
24 Tips for Connecting with Travelers Opus also turned to ReviewPro to collect guest feedback and aggregate results to help them understand guest likes and dislikes. The hotel posts genuine responses to online feedback and takes action where changes are needed. Opus s strategic approach to driving more direct bookings, engagement and loyalty has generated very positive results. Through the process Gandossi and his team have learned a great deal about what works and what doesn t work. Here are Gandossi s top tips for connecting with travelers digitally: Opus s Tips for Connecting with Travelers A TripAdvisor review of Opus Hotel shows the value of guest engagement Keep it easy and simple; i.e., no download of apps required. Listen to how your guests want to communicate. Make sure your communications are not overly sales focused. Offer value to the guest for using any software. Don t overload the guest with communications. Treat everyone like a VIP! Managing Guest Satisfaction Surveys: Best Practices 24
25 About Us ReviewPro is the leading provider of Guest Intelligence solutions to independent hotel brands worldwide. Visit our Resource Hub The company s comprehensive suite of cloud-based solutions includes Online Reputation Management (ORM) and the Guest Survey Solution (GSS), which enable clients to obtain a deeper understanding of reputation performance as well as operational/service strengths and weaknesses. We provide actionable insight to increase guest satisfaction, rankings on review sites/otas and ultimately revenue. The Leading Source of Guest Intelligence best practices and content for the Hospitality Industry The company offers the industry-standard Global Review Index TM (GRI), an online reputation score, which is used by thousands of hotels worldwide as a benchmark for reputation management efforts, based on review data collected from 161 online travel agencies (OTAs) and review sites in more than 45 languages. More than 19,000 hotel brands worldwide are currently using ReviewPro s solutions. Learn More Request a Free ReviewPro Demo now Managing Guest Satisfaction Surveys: Best Practices 25
26 Managing Guest Satisfaction Surveys: Best Practices
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