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Tim Peter Thinks

Tim Peter

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May 10, 2019

The Hotel Marketing and Distribution Trend You Care About Most This Year

May 10, 2019 | By | No Comments

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Hotel marketing and distribution: Why Google matters

Let’s talk distribution for a minute. Yeah, I know, distribution is one of the least sexy aspects of the hotel industry. It’s also one of the most important, especially for hotel owners and independent hotel operators. Hotel owners, operators, and brands looking for ways to reduce costs and increase profitability need to continue thinking about how they’re going to acquire guests in a cost-effective manner. Also, hotel marketing and distribution are joined at the hip. And the whole topic is about about to get much, much more interesting.

Why? What’s going on here?

In a word, it’s Google. Google is what’s going on here.

The Beast That Scares the 800-lb. Gorillas in Hotel Marketing and Distribution

Google isn’t the 800-lb. gorilla of the hotel industry. No, Google is a much larger and more ferocious beast that has all the industry’s 800-lb. gorillas running for cover. Google is stealing mindshare — and potential margins — from OTA’s and other intermediaries every single day. No less an observer than Expedia CEO Mark Okerstrom plainly stated that Google represents his company’s biggest competitor. In his words, “The internet has been littered with the bodies of companies put out of business by Google.” Okerstrom’s job is to make sure Expedia isn’t one of them.

Okerstrom is right. It’s no secret guests increasingly use Google as the first stop in their decision-making journey. And with recent integrations of Google’s artificial intelligence-powered, travel booking capable Assistant into Google Maps on Android and iPhones alike, expect even greater use of the search giant when guests plan their stay. There are over 3 million searches on Google every minute, with more than half of those on mobile and roughly 20% of those using voice. That’s at least 300,000 voices searches every minute, many of them targeted towards travel. Everyone’s scrambling for share, further driving up the cost of acquiring guests.

For example, Expedia, Booking.com, and others — OK, Expedia and Booking’s subsidiary brands and metasearch channels — recognize this shift, spending more on marketing and advertising with Google to drive more traffic to their direct channels. That’s a switch, huh? But it’s a fact. To drive traffic to its sites, Booking.com paid Google in Q3 alone last year somewhere in the neighborhood of $1 billion.

Nice neighborhood, eh?

At the same time, as Google increases the amount of metasearch and paid inventory in its search results page, it’s also driving up costs for individual hotel owners and operators. Worse, without solid connectivity solutions — which far too many independent hotels lack — hotels can be shut out of Google’s latest product offerings and miss out on direct revenue opportunities altogether.

How to Deal With Google’s Domination of Hotel Marketing and Distribution

So how can you ensure you earn your rightful place at the table and gain booking share without significantly increasing your cost of guest acquisition? Here’s how:

  • Develop a comprehensive distribution strategy that includes both search and metasearch. Search is a distribution channel. And the search landscape gets more and more challenging every day. SEO, paid search, voice search, metasearch, AI, schemas, and whatever else Google rolls out next can’t be considered in isolation. Each plays a role in driving guests towards your direct booking channels and in delivering flow-through — positive or negative — towards your bottom line. Similar thinking should shape your OTA agreements. Do your internal team, website development firm, and marketing agency understand how to best make these work together to deliver the lowest total cost of distribution for your property? This is critical question that your property must get right. Otherwise, you risk continuing to fund OTA’s bidding against you in search, driving up the costs of your hotel marketing and distribution, and further risking your property’s distinct value proposition.
  • Offer destination content to gain guests earlier in their decision-making journey. Data shows that guests who start their research on OTA’s book on OTA’s. I strongly suspect the same will be true for Google before long, most likely in the form of metasearch and partnerships. Already, Google displays a remarkable number of paid listings and metasearch results before getting to organic results. This is a huge problem for hotel marketers. Why? Well, to put it bluntly, guests who don’t come to your website never get the chance to book direct. It’s critical you use content about your destination to move deeper into the long tail of search, getting guests to your site early in the journey and for terms that aren’t flooded with paid/metasearch offerings already. Google’s AI-driven search results place significant value on quality content. Give them — and your guests — something worth finding.
  • Focus on increasing conversion rates on direct channels. Here’s a simple truth: It’s always going to cost you something to get guests to contact you. You’d damn well better make sure they convert when they do. It doesn’t matter whether guests come to your website or call your reservations line; every lost opportunity increases your cost. Take a close look at where your reservations come from, how effective your direct channels are at turning interest into action, and how to improve those results to get the best return on your spend.
  • Ensure your connectivity options support Google — and potential future competitors. Do your direct channels appear in Google’s metasearch results today? Or does your property only appear via intermediaries? The latter is a clear sign you’re paying more for reservations than you should — likely much more. Make sure your team is working towards placing your property’s direct channels front and center in metasearch on Google, as well as on other metasearch partners who offer the opportunity to challenge Google in the future. Or accept the fact that you’re always going to pay more for bookings than you should. But that doesn’t seem like a good long-term plan to me.

Conclusion

Distribution funnels through a limited number of chokepoints and gatekeepers. And, at least for the foreseeable future, the number of gatekeepers continues to shrink towards just one: Google. If Expedia worries about Google eating its lunch, you might want to given the search giant some thought too. And then you want to put those thoughts into action.

Google may be the beast that 800-lb. gorillas fear. That doesn’t mean it should scare you. Individual property owners and operators may not be 800-lb. gorillas. But unlike the big guys, they can run through the jungle much faster. Think about your hotel marketing and distribution strategically and you’ll be able to outrun the big guys for a long time to come.

Past Insights from Tim Peter Thinks

If you’re looking to learn even more about how changing customer behavior will shape your marketing going forward, be sure an 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 want to check out these slides I had the pleasure of presenting recently about the key trends shaping marketing in the next year. Here are the slides for your reference:

Finally, you might enjoy some of these past posts from Thinks to help you build your e-commerce strategy and your digital success:

A version of this article originally appeared on Hotel News Now as "The Distribution Trend You Care About Most in 2019"

Tim Peter

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August 14, 2016

10 Great Hotel Direct and OTA Distribution Posts: Hospitality Marketing Link Digest

August 14, 2016 | By | No Comments

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10 Great Hotel Direct and OTA Distribution Posts: Hospitality Marketing Link DigestHowdy, Big Thinkers! Super hot here in the wilds of New Jersey today, so I’m going to skip the setup and get you straight to this collection of these 10 great hotel direct and OTA distribution posts from the past week. Enjoy:

  1. Leading off, we’ve got these “3 Myths About Hotel Direct Revenue You Must Stop Believing” for you. Great stuff.
  2. You also won’t want to miss these “8 Outstanding Insights: the Top Travel Marketing Posts of Summer, 2016.” Definitely worth your time.
  3. One of the reasons you’ll want to pay attention to the tips outlined above comes from Business Travel News, who report that “Hotel Occupancy Flattens Across Global Regions.” It seems like the good ol’ days are starting to come to an end. Most of the RevPAR growth in the past year has come more from rate than occupancy. While that’s a good way to gain growth, it’s also a sign that demand for rooms is beginning to fall, the supply of rooms is increasing, or, most likely, a bit of both. Definitely time to get ready for a tougher market ahead.
  4. Inc. Magazine looks at “3 Travel Hacks Millennials Use and You Should Too.” Interesting insight into how millennials — and many consumers, really — actually shop for travel and well worth your time.
  5. In other less-welcome news, HotelMarketing says that “In Search of Hotels, More Travelers Turn To OTAs Than Hotel Websites.” That’s not great, really.
  6. EyeForTravel looks at “OTAs vs Hotels: Why ‘An Old and Tired Story’ Keeps Running.” Well, for starters, there’s things like this: “OTA’s vs. Chain Brands: Expedia Comes Out Swinging.” Though, I suppose, we also ought to consider “A Fair and Balanced Look at Balancing Direct and OTA Business” too. OTA’s have their role to play in your distribution strategy. It’s your job to ensure you use them correctly.
  7. Before moving on, Director in the UK explains how “Booking.com Envisions the Future of Travel.” Absolutely something you should check out, if for no other reason than “know your competition.”
  8. And on a highly related note, TheStreet says “Here’s Why TripAdvisor Is Becoming the Facebook of Online Travel” that you should take a look at too.
  9. If you’re looking to grow your direct business, these “5 Helpful Hospitality Marketing Stories for You” from our Hospitality Marketing Link Digest are worth a look.
  10. And, finally, pay attention to these “Four Key Elements of Modern Hospitality Marketing” to help you reach and attract more guests to your hotel. You’ll be glad you did.

If you’re looking for even more travel marketing goodness, you might also want to take a moment to review the slides from my recent seminar, “Digital Marketing Directions 2016: The Key Trends Driving Your Hotel Marketing Next Year” here:

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

Tim Peter

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November 29, 2015

6 Spectacular Marketing and Distribution Insights: Hospitality Marketing Link Digest

November 29, 2015 | By | No Comments

6 spectacular marketing and distribution insightsHey, Big Thinkers, hope you’ve had a fantastic holiday weekend. Not much setup this time around, but I bet you’ll like these 6 spectacular marketing and distribution insights from the past week. Enjoy:

  1. Tnooz uncovers why TripAdvisor excels at product. Key takeaway? Test, test, test. Want to know how to do that? Well, for starters, check out our coverage of A/B testing.
  2. We took a look at why Priceline believes in the death of search engine optimization (SEO)—and why I don’t. As it happens, according to Search Engine Land, Google just released the full version of their search quality rating guidelines. So it seems Google isn’t giving up on search either.
  3. Of course, that doesn’t mean Google has put its eggs solely in the search basket. As Travolution notes, Google showed off its new destination experience at Phocuswright 2015 but denied its OTA intentions. Yeah, right. If Google isn’t becoming an OTA, we need to have a serious discussion about what an OTA is anymore. Google definitely has its sights set on owning a piece of the hotel distribution pie—specifically, the dollars hotels now spend with OTA’s. Happily, there’s a fairly straightforward playbook you can use to prevent intermediaries from driving up your costs—no matter who they are.
  4. On a highly-related note, we examined the hidden factor OTA’s use to get between you and your guests and, more importantly, how you can use the same trend to your advantage.
  5. PSFK talked with Airbnb’s Head of Product about the future of travel experiences while Mobile Commerce Daily reported on Airbnb’s digital platform upgrades that place a bigger focus on hosts. Each of these stories highlights the need for driving brand intimacy in hospitality.
  6. And, finally, you won’t want to miss these mind-blowing mobile stats for hotel marketers from Google we rounded up the other day. Really useful information as you’re finalizing your budgets and plans for next year.

If you’re interested in more insights and information about travel marketing and distribution, you’ll definitely want to check out these “4+ Fantastic Travel Marketing Posts: the Top Posts Of October, 2015” and be sure to check out this list of “4 Tremendous Travel Marketing Trends From the Past Week,” a great set of “7 Key Insights: The Top Travel Marketing Posts of August, 2015” and a terrific round-up of “7 Brilliant Insights into Mobile Travel E-commerce” from our hospitality marketing link digests (part of the ongoing E-commerce Link Digest series).

And if you’re looking to learn even more about how changing guest behavior shapes hospitality marketing, e-commerce, and distribution, be sure an 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 want to take a moment to review the slides from my recent webinar, “Digital Marketing Directions 2016: The Key Trends Driving Your Hotel Marketing Next Year” here:

Finally, you will definitely 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

By

April 16, 2013

Booking.com just announced something amazing

April 16, 2013 | By | No Comments

The growth of mobile So, I don’t normally cover press releases, but this one’s worth mentioning:Priceline subsidiary Booking.com reported late last week that their mobile booking revenue tripled last year. Which would be impressive, until you consider that it tripled to $3 billion from $1 billion in 2011. That’s billion. With a “b.”

Um… wow.

I gave a talk this morning to a group of travel and hospitality companies about how big mobile’s going to be. And I referenced items like the growth of the millennial market, how to handle the iOS/Android debate, and all that jazz. But, by any standard, those are some impressive results. I’m thinking there might be something to this mobile web business after all.

Interested in more? Sign up for our free newsletter and get more information on how to build your social, local, mobile marketing strategy. And, if you’ve got a minute, you might enjoy some past coverage of mobile, including: