Hotel Industry Blog

Tuesday, October 5, 2010

ROI Is Not Just About Online Marketing

The success of PPC advertising is directly related to the fact that spend can be easily tracked and can show clear and measurable ROI. The results can be even more spectacular when online sales systems are directly integrated with Google’s Analytics tools via the Ecommerce framework, an integration that has been a key and unique feature of Bookassist’s booking engine for the last 2 years for example.

All of this means that more and more hotels have been focusing on PPC campaigns as their primary marketing tool. And this is exactly what hotels should be doing. But this is not the whole story.

To some extent, the easy measurability of online clicks has meant that PPC gets a lot of the credit for what other online and offline factors have in reality contributed to. This so-called “last-click attribution” model, equating the click that led to the sale to the reason for the sale, can lead to false assumptions about how your marketing is really working. Determining the relative contribution of different elements of the marketing process to the final conversion is quite a complex task, but being aware of the way the elements can interact is at least a good first step to improving conversions.

Offline Is Not Dead
PPC is just one key element in a holistic approach that many hotels are not yet fully embracing. Offline marketing, for want of a better phrase, is a necessary support mechanism for online marketing. Offline and online need to share a single coherent strategy, just as they share the same ultimate goal of increasing revenue. To view online marketing and offline marketing as entirely separate, or indeed as competitive, is a wasted opportunity.

Brand Recognition
There is no doubt about the broader and more focused reach of online versus offline marketing in tackling potential new business. The use of targeted keywords and key phrases in search marketing can focus your advert display significantly. However the impact of the advert itself may not be sufficiently strong if the brand represented is completely new to the potential customer. This is where online presence other than PPC, and offline advertising, can help.

To take a simple example: suppose your hotel runs PPC campaigns and an online searcher for hotels in your area sees your advert. Perhaps they have never heard of your hotel, so the advert doesn’t trigger any particular recognition in them. It’s just one of many ads. Now suppose that this same online searcher has just recently heard a radio advert using your hotel’s name and talking about your great online specials. Seeing your hotel’s name in the online ad now triggers some recognition in the customer which makes the advert stand out from the crowd just that little bit more. This brand awareness can contribute to a higher click rate, though measuring the increase is extremely difficult. Certainly we see correlation in our client list between click through rates and radio/TV advert campaigns that those hotels run from time to time.

The nature of search is that it is based in many instances on the final collation of data from various sources, including word of mouth, peer recommendation and offline marketing initiatives. A significant number of searches that lead a user directly to the hotel website are based on variations of the hotel’s name, which increases in direct proportion to offline activity.

Print media, display advertising, radio and television can all be used to plant brand recognition in the minds of potential customers which in turn improves online click-through. In order to help quantify their effect, they need to be coordinated with particular campaigns online so that not just brand awareness, but awareness of a specific offer, is generated. To some extent, this tracking is easier when offline advertising references a specific action which can then be followed online. An example would be print advertising which shows a specific promo code, which when entered in the booking engine gives a specific offer. The tie-in between online conversion and offline advertising is clear and Bookassist’s promo code system has proven quite effective when used in this way.

Three Simple Offline Winners
Online, the key areas that enhance brand recognition and indirectly influence PPC click through rates are high quality web presence, social media use, blogging, video presence on sites such as YouTube and so on. These enhance a potential customer’s perception of quality and customer service and create more trust in the brand. Much has been written in this column in previous months about the benefits of these approaches in aiding conversion.

Apart from print media, display advertising, radio and TV tie-ins with online campaigns, there are many offline activities that can contribute to online success. Here are some simple ones.

1. Use QR codes on all your print media and print advertising to direct people to your website (or better still for your mobile webapp). QR codes are still relatively new, and people are curious about them. Even if people don’t initially know what they are, they drum up curiosity and cause people to think that little bit more about what they are seeing and figure out what they are and how they can access them.

QR codes embedded in your print media and adverts, even on your stationery, business cards and brochures, enforce the link between online and offline. An example QR code generator online is

2 .Segment your arriving guests daily into those that booked directly on your website, those that booked via high-commission third party channels, and those that booked offline. Since direct booking on your website is the lowest acquisition cost for you, offer those guests who did not book directly a simple business card at check-in which contains a promo code for an automatic reduction if they book directly online next time. Include a printed QR code so people can get straight to the deal on web or mobile. In this way you have used the expensive third party channels to your advantage in delivering the first customer, but you have now raised awareness of your website and your preferential rates in the customers’s mind and are now far more likely to generate repeat business directly from that customer at a lower acquisition cost, plus build real lifetime value. This is online sales being driven directly by your reception and reservation staff. If you are one hotel in a group, ensure that your sister hotels are listed on the promo card you hand the guest to further encourage future sales online for those hotels.

3. Personally-addressed postal or snail-mail campaigns also still work provided the offer is compelling, is focused, and the channel is not overused. Postal mail stands out for recipients a lot more than email blasts, since post is usually accessed in a different context - among less items and at a more leisurely pace - than online mail. Once or twice a year, a single focused compelling offer in the post to particular segments of your existing customer database can generate high take-up. The point is to be compelling, so consider again promo codes that give automatic reductions or exclusive specials related to the segment you are targeting and which encourage your customer base online. And of course since you are sending out print, embed your QR codes to bring people straight to the website or mobile webapp.

The key to incremental growth in your direct online business is to keep a multichannel approach and to continually experiment to get the mix right.

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