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Tim Peter Thinks

Tim Peter

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October 16, 2014

Will E-commerce Kill Retail?

October 16, 2014 | By | One Comment

Woman shopping phoneeMarketer has new research out that asks how much longer will traditional stores remain shoppers’ favorite, with the underlying premise being that traditional retail is doomed. But is that really true? Will e-commerce kill retail?

Well, with all due respect to my friends at eMarketer, this is a silly question. How long will traditional stores remain shoppers’ favorite channel?

Forever. At least for most purchases. And at least if you do it right.

First, let’s dig into the research. Here’s the good news:

“Among digital shoppers worldwide, 72% said the traditional store experience was important when making a purchase—the highest percentage out of locations and channels studied. The internet landed second, at 67%.”

Customers actually prefer the in-store experience over any other channel when making a purchase.

Even more good news for most retail outlets:

“Despite mobile’s rise and rumors of showrooming, smartphone websites and apps trailed behind in-store tech and even email as important channels for purchases.”

Of course, every silver lining has a cloud, right? Here’s the not-so-good:

“Capgemini noted that physical shops faced a grimmer future: Digital shoppers worldwide planned to order directly from brand manufacturers more in the coming years (65%), up ordering via a manufacturer’s app (53%) or third-party app (50%), spend more money on the internet than in a brick-and-mortar (51%) and turn to stores for showrooming rather than purchases (48%).”

Well, sure. When customers have experiences like those in yesterday’s podcast episode, “When It’s All E-commerce Goes Wrong”, of course customers would rather shop online.

But… it doesn’t have to be this way. I’ve said many times that all marketing is social. And that’s because all people are social. For many, many people, it’s a lot more fun to get out and mill about at the mall (or whatever its future equivalent may be), than it is to sit at home. And it always will be.

Remember, I do digital for a living, love it, and breathe it. That doesn’t change the fact that human beings are social creatures. Digital, mobile, online — whatever you want to call it — is incredibly convenient. It makes it easy to shop and buy the things you want, when you want, where you want, and how you want. I recently needed to get some replacement water filters for my refrigerator. Ordering online offered a fantastic way to accomplish that goal as a.) I didn’t need the product today, and b.) I don’t particularly enjoy shopping for refrigerator filters.

Of course, e-commerce and digital provides customers a convenient way to shop when and where they want for all sorts of products and services, including much more highly considered and personal purchases than water filters. It’s not e-commerce or traditional retail. It’s e-commerce and retail, working together that provides the greatest benefits to both you and your customers.

What will change, though, is what it means to be a “traditional” retailer. Take a look at what Birchbox is doing with its new storefront, Amazon’s new storefront in Manhattan, or Apple’s exceedingly successful retail strategy. Each takes a different approach to solving customers’ retail needs. And, yes, it’s not guaranteed that all three will succeed in the long run (though Apple sure seems to have a bright road ahead).

Marketing in a mobile, social, digital era differs from the past in that your customers can easily find a preferable alternative — especially if you don’t offer them an attractive option today. But that’s a choice you make, every day. Make the right one, and your customers will continue to choose you for a long time to come.

If you’re interested in learning even more about how customers changing behavior shapes e-commerce and marketing, register to receive a special report I’ve produced in conjunction with hotel marketing firm Vizergy, “Digital Hotel Marketing in a Multiscreen World.” While it’s targeted specifically at hotel and resort marketers, the lessons apply to just about any business. You can get your free copy of the report here.

Plus, don’t miss these slides and video from my recent webinar, “Digital Marketing Directions: Three Key Trends Driving Your Marketing Next Year”:

Finally, you might also want to check out some of our past coverage of the mobile, local, social web and how to make it work for your business, including:

Tim Peter

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October 15, 2014

When It’s All E-commerce Goes Wrong – Thinks Out Loud Episode 94

October 15, 2014 | By | No Comments

Waiting in line

When It’s All E-commerce Goes Wrong Headlines and Show Notes

You might also enjoy the slides from my recent webinar, Digital Marketing Directions: Key Trends Driving Your Marketing Next Year,:

Contact information for the podcast: podcast@timpeter.com

Technical details: Recorded using an Audio-Technica AT2035 studio condenser microphone through a Mackie Onyx Blackjack USB recording interface into Logic Express 9 for the Mac.

Running time: 16m 35s

You can subscribe to Thinks Out Loud in iTunes [iTunes link], subscribe via our dedicated podcast RSS feed (or better yet, given that Google has now killed Reader, sign up for our free newsletter). You can also download/listen to the podcast here on Thinks using the player below:

Tim Peter

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October 6, 2014

7 Key Tips for More Effective Email Marketing

October 6, 2014 | By | No Comments

7 key tips for more effective email marketingI got an email from Geoff in the UK the other day, who asked,

“You’ve written in the past about how to grow my business’s email list and that Millennials still use email. You’ve sold me. I want to grow my list and reach more customers. But, even with a large list, I don’t know that the results we’re seeing are as effective as they can be. How can I make my email marketing more effective?”

Good question, Geoff. And, happily, I’ve got an answer for you. Well, seven, actually. Here are 7 key tips for more effective email marketing:

  1. Address your email message to your key customer segments. It’s almost impossible to write an email that works for the entire world (or your entire list). It simply doesn’t work as well as targeting a key customer segment and speaking to that group’s needs. Think about who you’re addressing your email to, then build the message around the needs of that customer segment. Personas help, too (see slides 137-141 in my presentation “The Truth: How the Social, Local, Mobile Web Affects Sales Online and Offline” for more on personas). While you can craft a single email message that uses different sections to address different customer needs, work to segment your email list into its component groups over time. A more focused message will perform better, and improve your customers’ experience, too.
  2. Write a clear subject line. Once you know who you’re sending your email message to, draft several subject lines until you find one that resonates for your target customer segment. As these 6 simple subject line tips to boost email open rates suggest, sometimes less is more. A subject that says “Offers and updates from [INSERT YOUR COMPANY NAME HERE]” often works better than “Super Deals! Free Stuff! Amazing Opportunities!” For one thing, you’re setting a more realistic expectation of what’s inside. For another, you’re more likely to get past your customer’s spam filter.
  3. Present a simple, strong call-to-action. You’d be amazed how often I see email messages with multiple, competing calls-to-action, or, worse yet, no call-to-action at all. Make sure that each separate message in your email provides a single, clear call-to-action. Try terms like “Learn more,” “Read on,” or “Browse offers” to clearly indicate what you expect your customers to do. And, if you’re talking about a few different offers in a single email blast, vary the size and placement of those calls-to-action, to make it clear for customers what’s most important, what’s secondary, and what’s less important. You’ll reduce your customer’s confusion, while still providing everything she needs to make a decision.
  4. Images, images, images. Images sell. Period. Give your copywriters a rest, and increase the size, quality, and frequency of images within your email messages. Do you think your customers keep buying high-def screen mobile phones and tablets just to read more text? ‘Fraid not, folks. Customers love images. So put those high-res screens to use. And make your images clickable, too. There’s no reason a well-designed image can’t serve to reinforce your call-to-action — and make it easier for customers to click once they’re ready.
  5. Use responsive design for your emails. As this look at how to improve your email in just 5 minutes mentioned, emails with responsive design enjoyed a 21% higher click-to-open rate than emails using a non-responsive design. So, assuming you’ve got a 20%(-ish) open rate, responsive design will buy you 42 more opens for every 1,000 people on your list (or 420 for every 10,000, or 4,200 for every 100,000…). And, if you provide the right images and calls-to-action, those extra opens will drive increased clicks and increased conversions, too.
  6. Benchmark your results. Where’d I get that “20%(isn) open rate” number? From benchmark data. Most major email providers offer decent benchmarks you can use to measure your effectiveness against others in your segment. Think in terms of your key email marketing metrics — total opens/open rate, unique clicks/effective rate, conversion, unsubscribes — and use those numbers to see when you’ve got room to improve, and when you might be fighting a period of diminishing returns. Develop internal benchmarks, as well, to evaluate your progress over time.
  7. A/B test everything. Finally, making your email marketing more effective depends on conducting regular tests to see what’s working for your customers, then applying those learnings to your ongoing efforts. While I’ve covered A/B testing in detail over the years, email marketing introduces a few wrinkles of its own. For instance, to test subject lines, consider a holdback test. In this test, you test two competing subject lines by sending each to 10%-15% of your total list (split the two different subject lines evenly between the group), measuring which subject line drives the greatest open rate. Once you have a winner, you send the remaining 85%-90% of your list (the holdback group), the winning subject. You can conduct similar tests within your message body, splitting your list to see which headlines, images, copy, and calls-to-action drive greater results before sending the final version to the majority of your list. The more tests you conduct, the more you’ll learn what works for your audience, and what drives the greatest results for your business.

The great thing about these tips is they apply equally well in both B2C and B2B contexts (especially important given that email represents a key way to reach top decision-makers in B2B environments). While the specific messages, headlines, copy, and images, will certainly vary, the general approach works just as well to both types of customer.

Despite sometimes representing a forgotten social network, there’s no doubt that email marketing still works for reaching qualified customers, and driving meaningful business results. Follow the 7 key tips for more effective email marketing just outlined, and you can expect to see those results for your business too.

Want more? Then you might want to check out these slides called, “Email Marketing: Keys to List Growth,” from a recent talk I gave to a private industry group:


(And, yes… you can hire me to speak at your next event, too).

And if you’re interested in learning even more about how customers changing behavior shapes e-commerce and marketing, register to receive a special report I’ve produced in conjunction with hotel marketing firm Vizergy, “Digital Hotel Marketing in a Multiscreen World.” While it’s targeted specifically at hotel and resort marketers, the lessons apply to just about any business. You can get your free copy of the report here.

Finally, you might also want to check out some of our past coverage of the mobile, local, social web and how to make it work for your business, including:

Tim Peter

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September 11, 2014

Mobile E-commerce Now Bigger Than Desktop

September 11, 2014 | By | No Comments

Mobile commerce is bigger than desktopHuge news from Mobile Commerce Daily:

“In 2010, 96 percent of online retail browsing was done on desktops while only 4 percent took place via mobile devices. Today, those numbers have collided and continue to move in opposite directions, with 51 percent of retail visits occurring via mobile.”

As the article also notes:

“Since consumers are more likely than ever to make a purchase via mobile devices, retailers and brands prepping for the 2014 holiday season are likely to route their strategies accordingly. As the anticipated launch of iOS 8 is right around the corner, retailers should expect a prevalent use in this department as virtual gift giving continues to replace its physical counterpart.”

As you may have heard before:

“The simple reality is that customers use mobile regularly during their discovery, browsing, and shopping experience (less so for buying, though that may be more an attribution problem than an actual conversion problem). The question is whether they’re finding you during that same process.”

Plus, that attribution vs. performance problem likely is also going away. I talked a fair bit yesterday about how ApplePay, launched earlier this week, is going to be a game changer for mobile commerce. The integration between ApplePay and checkout within apps is fundamentally going to reshape our notion that “no one buys on mobile.” And I’d be stunned if Google doesn’t counter with updates to Google Wallet at its earliest opportunity, so this isn’t just some “Apple fanboy” moment suggesting only one player’s going to get in this game.

The simple fact remains that, for today’s constantly-connected, media-immersed consumers, it really is all e-commerce. And the question remains, what are you doing to help them?

Just as a quick reminder, you might want to check out a webinar called Digital Marketing Directions: Key Trends Driving Your Marketing Next Year that I’m presenting on Tuesday, September 16, 2014. You can read all the details here.

You may also enjoy this look at growing your email list and its importance as an e-commerce best practice as well as reviewing the slides from a talk I gave all about email marketing in an age of mobile:


(And, yes… you can hire me to speak at your next event, too).

And, if you’re interested in learning even more about how customers changing behavior shapes e-commerce and marketing, register to receive a special report I’ve produced in conjunction with hotel marketing firm Vizergy, “Digital Hotel Marketing in a Multiscreen World.” While it’s targeted specifically at hotel and resort marketers, the lessons apply to just about any business. You can get your free copy of the report here.

Finally, you might also enjoy some of our past coverage of the mobile, local, social web and how to make it work for your business, including:

Tim Peter

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July 8, 2014

6 Key Secrets Every Hotel Marketer Should Know (Travel Tuesday)

July 8, 2014 | By | No Comments

Hotel marketing secrets to drive bookingsWant to know what separates the best hotel marketers from the also-rans? While there’s no one single thing, a few trends have emerged that contribute to success. Here are the 6 key secrets you ought to know for your hotel marketing efforts:

  1. Mobile is here. Now. I’ve talked — at length — about how big mobile travel really is. And it just keeps getting bigger. Scarcely a day passes without some new bit of data showing how frequently your guests use mobile to search and browse and find and book travel. It’s time to take mobile seriously for your business. OTA’s have invested significant amounts of money, time, and people into improving their mobile experiences for guests. It’s time you do, too.
  2. Millennials have arrived. Ignore them at your own risk. Data shows that millennials will spend more on trips this year than Gen X, increasing their spending almost 20% from last year, and that roughly one out of four millennials are planning more overnight leisure trips for leisure than last year. This doesn’t mean that you abandon Boomers or, if they’re a big part of your mix, Gen X. Not at all. However, as Jeff Bezos of Amazon recently pointed out, “All businesses need to be young forever. If your customer base ages with you, you’re Woolworth’s.” Consider how often senior executives from the big brands — Marriott, Hilton, Airbnb, Expedia — talk about millennials publicly (hint: Often). Boomers are beginning to age out of the marketplace, while millennials are coming on strong. You need to think about your next generation of travelers now.
  3. Search is getting expensive. Now, don’t misunderstand. I’m a huge fan of search marketing. It works well for most hotels to drive traffic and reservations. Unfortunately, for a whole slew of reasons, it’s getting increasingly expensive. More hotels use paid search than ever before. OTA’s increasingly use paid search to dominate the search results. And, guests have shifted to mobile in a big way — brining with it lower conversion rates and higher acquisition costs. As a result, you’re almost certainly seeing increased costs for paid search. A number of approaches exist to improve your booking costs from search. Use these approaches to hold your costs down. And you must also continue to look for additional sources for traffic and reservations beyond search (and you can ask me for help too).
  4. Metasearch will continue to evolve. Sadly, metasearch probably isn’t one of the ways to find traffic and reservations — at least not for long. Metasearch isn’t a product. It’s a feature. Expedia, Booking.com, TripAdvisor, and, yes, Google, can add metasearch features to they’re products anytime they choose (and some already have). Metasearch doesn’t represent the “Holy Grail” that will break the dominance of OTA’s on travel search. Hell, most of the big metasearch companies are owned by the OTA’s. Instead, metasearch as a feature represents just the latest step in the long evolution of price transparency in the hospitality space. Use them accordingly, highlighting why guests can expect to get the best rate and, more importantly, the greatest value when booking direct.
  5. Reviews matter. A lot. On the flip side, reviews offer a great way to reach guests and convey your hotel’s story. In fact, effectively managing your reviews represents the single best way to improve your digital marketing. Check out the current review landscape: Review volumes are way, way up. Guests continue to value reviews. And management (i.e., your competitors) are getting better at responding to reviews. Again, it’s about transparency. Use dedicated review sites such as TripAdvisor, Google+, and Yelp, as well as OTA review management tools to help answer your guest’s questions and drive more engaged guests.
  6. Your customer data is better than anyone else’s. Despite its age, email marketing remains among the most effective ways to engage with guests. Why? Well, you’re talking to a guest who travels, who has stayed with you before, and, as long as you’re following best practices for email collection, has agreed that he or she wants to hear from you. Even better, that guest is someone your competitors can’t reach as easily. Continue to grow your email list. Focus on testing what works in terms of open rate, click-through, effective rate, and conversion. Then apply what you learn from those tests the next time to improve your overall customer acquisition costs.

The simple fact is, whether you’re a single-property owner, management company, or major brand, independent or chain, you can compete with the Big Boys. But only if you’re smart about it. Trying to go toe-to-toe with large brands or OTA’s, trading blows in the center of the ring, is a terrible strategy. They have more money, people and data than you do. But, you can change the rules, and focus on improving your interactions with guests at every step in the process — regardless of marketing or distribution channel — to highlight your value and your values. Guests increasingly appreciate knowing more about their hosts and how they fit into the community (note the rise of Airbnb, for instance). Use that to your advantage. You may not be able to go toe-to-toe with the OTA’s. But the biggest secret of all is that, if you do this well, you won’t need to.

Interested in learning even more about the future of e-commerce and marketing via the social, local, mobile web? Register to receive a special report I’ve produced in conjunction with hotel marketing firm Vizergy, “Digital Hotel Marketing in a Multiscreen World.” While it’s targeted specifically at hotel and resort marketers, the lessons apply to just about any business. You can get your free copy of the report here.

And, if you’re curious about other trends shaping travel marketing, take a look at my recent presentation, called, aptly enough, “Digital Marketing Directions – Exploit the Trends that Shape Travel Marketing”:

Finally, you might also enjoy some of our past coverage of the social, local, mobile web and what it means for your business, including:

Tim Peter

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July 1, 2014

14 Killer Resources for Hotel Marketers: Travel Tuesday’s Best of 2014

July 1, 2014 | By | No Comments

Travel guests mobileHow is it possible that 2014′s half-over? For most hotel marketers, you’re already looking towards your 2015 budgeting and planning. As you prep for next year, now’s a good time to look back at the trends driving your guests’ behaviors — and how you can use those in your digital marketing, distribution, and e-commerce going forward. With that in mind, I’ve pulled together the 14 most popular posts of 2014 so far for you to review. Here’s what we’ve got:

  1. It’s no secret how important mobile is for hotel guests making travel plans, as this post, “Holy Crap! Mobile’s Even Bigger Than You Thought,” clearly illustrates.
  2. While coming in at #2, this look at “How to Use Emotion and Storytelling in Digital Marketing” was wildly popular among your fellow hotel and travel marketers.
  3. When asked why he robbed banks, Willie Sutton famously said, “That’s where the money is.” The same could be said about affluent travelers, which likely explains the popularity of this next post, “4 Lessons You Need to Know from Google’s Affluent Traveler Report.”
  4. Few hotel marketing techniques work as effectively as improving your online review situation. This post, “What’s the State of Hotel Reputation Management?” clearly demonstrates why.
  5. Don’t worry if you didn’t get a chance to go to HSMAI’s Digital Marketing Strategy Conference. This round-up of the “10 Essential Lessons Learned From HSMAI’s Digital Marketing Strategy Conference” will let you know what you missed.
  6. It looks increasingly like two major intermediaries want to dominate the online travel space. Check out “What in the World are Priceline and TripAdvisor Up To?” to understand what that means for your hotel.
  7. Another major post that highlights mobile’s importance is “It’s Time You Take Mobile Seriously. Here’s Why.”
  8. Sure, Priceline and TripAdvisor are making some major moves in the travel space. But I wouldn’t count out Expedia. In fact, this look at “What Expedia’s Leaders Can Teach You About Digital Strategy” might just represent required reading for today’s hospitality markers.
  9. Interested in making the most of social for your hotel marketing? Then check out “The 4 Rules of Social Marketing for Hotel Marketers.”
  10. It seems the OTA landscape is getting more and more complicated every day. This post, “Search? Metasearch? What’s the Difference?” should help eliminate some of the confusion for you.
  11. Looking for a set of simple rules as you develop your strategy for 2015? Check out “How to Take Charge of Your Travel Marketing” for some tips and tools that can help you.
  12. Yet another look at mobile’s growing importance, “This Week’s Sign That Mobile Rules,” offers still more ideas on how to incorporate mobile into your digital strategy — and why you should.
  13. I’m not opposed to OTA’s. They often can help you reach guests you might not reach on your own. But, that doesn’t mean everything they offer is good for your hotel. For instance, this post, “Warning: OTA’s Want to Own Your Guest Every Step of the Way,” uncovers recent changes that could cost you guests and revenue down the road.
  14. Finally, “A Fair and Balanced Look at Balancing Direct and OTA Business” explores how to make the most of OTA’s in your overall travel distribution and marketing and is well worth the read.

Interested in learning even more about the future of hospitality e-commerce and marketing via the social, local, mobile web? Register to receive a special report I’ve produced in conjunction with hotel marketing firm Vizergy, “Digital Hotel Marketing in a Multiscreen World.” Developed specifically at hotel and resort marketers, the lessons can help your business adapt to the changing guest environment. You can get your free copy of the report here.

Given the overall popularity of the Travel Tuesday series, you may also want to review the tips in my recent presentation Digital Marketing Directions: Three Trends Shaping 2014 Hospitality Internet Marketing. I’ve presented this talk to a number of hospitality and travel-related organizations and you might find it valuable for your business, too:

Finally, you might also enjoy some of our past coverage of the social, local, mobile web and what it means for your business, including:

Tim Peter

By

June 23, 2014

Wickedly Effective Laws for E-commerce Websites

June 23, 2014 | By | No Comments

Young couple using e-commerce website to buy onlineE-commerce is a tricky beast, encompassing a variety of disciplines and approaches for finding, engaging, and assisting customers with their purchase decisions. You’ve got to know at least a bit about search and social and marketing and merchandising and a whole host of other skills ranging from the top of the funnel to user experience design to post-conversion customer service. And that’s before dealing with all the changes wrought customers’ shifting behaviors towards tablets and mobile and wearables.

I often find it’s helpful to start small. Instead of trying to do everything at once, focus on a few, critical elements of your plan and then execute against those elements.

Where should you begin? What are those “few, critical elements?” Well, happily, that’s the topic of my latest Biznology post, “The 5 Laws of Effective E-Commerce Websites.” Among the elements I recommend:

  • Solve Your Customers’ Problems First. Your customers are busy people, with busy lives. It’s not that they don’t care about you; they’ve just got lots of other things to worry about. Help your customers accomplish their goals and they’ll help you reach yours.
  • Focus on Key Metrics. Your sales represent the lifeblood of your organization, generating cash-flow and profit to sustain and grow your operations. Metrics serve as the “pulse” of your business, helping you measure your company’s health and directing you towards the right remedies when things aren’t going as well. Develop a data-driven culture that helps you identify what is and isn’t working so you can keep your business healthy. Utlimately, analytics and data aren’t about web metrics; they’re about business metrics.
  • Improve Your Images. “A picture is worth a thousand words,” may be one of the oldest clichés around. It’s also true. Plenty of evidence exists to show you can measure what a picture’s worth in dollars as well as words. Customers rely on what they can see online at least as much as what they can read. Create clear, crisp, attractive imagery that highlights the benefits your customers will receive from your products and services to drive increased engagement and interest.

Of course, these three items are just the beginning. You can check out all 5 laws of effective e-commerce websites, as well as how you can apply them to your business over on Biznology

If you’re interested in learning even more about the future of e-commerce and marketing via the social, local, mobile web, register here to receive a special report I’ve produced in conjunction with hotel marketing firm Vizergy, “Digital Hotel Marketing in a Multiscreen World.” While it was originally written with hotel and resort marketers in mind, the lessons apply to just about any business. You can get your free copy of the report here.

You may also want to review the tips in my recent presentation Digital Marketing Directions: Three Trends Shaping 2014 Hospitality Internet Marketing. Again, though presented to a travel marketing audience, the talk covers many essential laws of e-commerce and digital marketing across industries:

Finally, you might also enjoy some of our past coverage of how the social, local, mobile web continues to shape e-commerce and business generally, including:

Tim Peter

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June 4, 2014

What’s Wrong With Mobile and E-commerce Best Practices? – Thinks Out Loud Episode 75

June 4, 2014 | By | No Comments

Follow the leader?

What’s Wrong with Mobile and E-commerce Best Practices? Headlines and Show Notes

You might also enjoy my slides from the “Digital Marketing Directions – Exploit the Trends that Shape Travel Marketing” presentation for further examples of companies following — and breaking — best practices to great effect:

Contact information for the podcast: podcast@timpeter.com

Technical details: Recorded using an Audio-Technica AT2035 studio condenser microphone through a Mackie Onyx Blackjack USB recording interface into Logic Express 9 for the Mac.

Running time: 14m 27s

You can subscribe to Thinks Out Loud in iTunes [iTunes link], subscribe via our dedicated podcast RSS feed (or better yet, given that Google has now killed Reader, sign up for our free newsletter). You can also download/listen to the podcast here on Thinks using the player below:

Tim Peter

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November 5, 2013

3 Myths of Online Distribution Hurting Hotels (Travel Tuesday)

November 5, 2013 | By | No Comments

The essence of distribution strategyHotels work hard to balance the amount of revenue from online travel agencies (OTA’s), like Expedia and Booking.com vs. revenue from their own, brand-direct channels (phone, brand/property website, etc.).

A long-time reader emailed and asked:

“I pay a fair bit in commissions to OTA’s, but my website isn’t free. OTA’s have big marketing teams and I only have a director of sales. While I don’t like paying OTA commissions, wouldn’t I be better off saving on the cost of my own website and paid search and all those other things I don’t know much about and letting the OTA worry about those instead? That way, I just have to worry about negotiating a more fair commission level with the OTA’s.”

This is an important question for many hotels. And, yes, it’s a fact that pretty much every OTA will have bigger budgets and more resources dedicated to marketing, online and offline, than pretty much every hotel.

The challenge, though, is that this question depends on a few “common-sense” assumptions that are among the biggest myths of hotel distribution. What are these myths?

  1. Myth: Your guests’ make an either/or decision when choosing where to book. Guests don’t look at OTA’s or brand websites prior to making a booking decision; they look at OTA’s and brand websites prior to booking. The Google research I talked about last week suggests guests visit between 20 and 30 websites, conduct 12-17 searches, and spend 60+ days planning their trip. OTA’s play a role in facilitating that decision; so do hotel websites. Failing to provide information guests need on your site—or worse, not having a site at all—makes you appear less trustworthy than a hotel with a great site and a solid OTA presence. And that’s more likely to push guests to choose another hotel altogether, and not just another booking channel.
  2. Myth: OTA’s are evil. Just as your guests need choices, so do you, and OTA’s often offer a good choice for reaching guests. Distribution shouldn’t be about OTA’s vs. brand websites. It’s how they work together to help the guest and your property. A smart distribution strategy makes use of OTA’s for what they’re good at—reach, new markets, scale—while leveraging your own site for what it’s good at —brand storytelling. OTA’s can be a great source of new business when used well (and, yes, a fair commission level is part of “using them well”). Remember that OTA’s require inventory to sell, which gives you negotiating power. Use that power wisely to make OTA’s work for you, not against you.
  3. Myth: OTA reservations replace your need for a website. Remember, guests use your website as more than just a booking channel (although, ideally, it’s that too). Even if 100% of your business came from OTA’s, you wouldn’t get rid of your phone number, would you? Of course not. Nor would you get rid of your website. The cost of distribution through OTA’s are in addition to the costs of your website, not instead of. Your job is to put your website to work for you as both a customer service and a booking channel to reduce your costs and improve your revenues. Plus, you want to give guests who found you through OTA’s for their first stay a place to come the next time they want to stay with you.

You’re right not to try and compete head-to-head with OTA’s. Their scale, budgets, and resources make them a valuable contributor to your business, not a competitor. Just remember that, for the most part, it doesn’t matter where the first reservation from a given guest comes from. It’s the second reservation that matters.

So, yes, negotiate fair commission levels with OTA’s. And, yes, leverage their reach to find new guests. But funnel some of those revenues into investing in your own website as well, to tell your brand story, help guests decide whether you’re the right hotel for their stay, and receive direct bookings. When all the pieces work together, your property and your brand benefit both today and in the longer term, too.

If you’re interested in learning more about the future of e-commerce and marketing via the social, local, mobile web, register to receive a special report I’ve produced in conjunction with hotel marketing firm Vizergy, “Digital Hotel Marketing in a Multiscreen World.” While it’s targeted specifically at hotel and resort marketers, the lessons apply to just about any business. You can get your free copy of the report here.

You might also enjoy some of our past coverage of the social, local, mobile web and what it means for your business, including:

Tim Peter

By

October 16, 2013

What's E-commerce Mean Today, Anyway? Thinks Out Loud Episode 46

October 16, 2013 | By | No Comments

What's E-commerce Mean Today, Anyway?

What’s E-commerce Mean Today Anyway? Headlines

You can also register to receive a free copy of my special report, “Digital Hotel Marketing in a Multiscreen World,” produced in conjunction with Vizergy, here. While it’s targeted to the hospitality industry specifically, most of the lessons apply across verticals.

Contact information for the podcast: podcast@timpeter.com

Technical details: Recorded using a Shure SM57 microphone
through a Mackie Onyx Blackjack USB recording interface into Logic Express 9 for the Mac.

Running time: 15m 18s

You can subscribe to Thinks Out Loud in iTunes [iTunes link], subscribe via our dedicated podcast RSS feed (or better yet, given that Google has now killed Reader, sign up for our free newsletter). You can also download/listen to the podcast here on Thinks using the player below: