This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies.  Find out more here  Close
Hotels’ new land grab via retargeting
June 5 2014

The new land grab in the hotel booking journey is an increasingly heated strategy of customer retargeting, and it threatens to leave many behind.

Highlights
  • Retargeting involves reaching guests who leave online searches without making bookings.
  • Hoteliers are urged to formulate retargeting strategies or risk losing even more control of room stocks.
  • Facebook and other online giants use big data to learn even more about their customers.
 

GLOBAL REPORT—In the complex world of reaching potential guests and converting marketing into roomnights, the new land grab is a strategy of formulating retargeting strategies.
 
And the space is getting increasingly heated, according to sources and attendees at the recent advertising, search and trends data provider Adara’s Europe Partners Conference held in Barcelona last month.
 
Retargeting is the science of reaching guests via tailored ads, usually on mobile or tablet, that follow online searches that do not end with conversions. If conversion does not occur during an online search, Java script-installed websites produce “cookies,” or small pieces of data sent from a website that store a user’s Web browser history. Ads for hotels can then be enacted on future sites those consumers visit.
 
For instance, a potential customer searching for a hotel in Croatia on Website A who does not book anything will receive targeted Croatia hotel ads when he or she then surfs to unrelated Website B. This keeps potential conversion front and center in Web browsers’ cognizance, which is important considering only 2% of browsers will convert on their first visit, according to sources.
 
Retargeting also is known as conversion rate optimization, or CRO. With retargeted ads also being person-specific, the issue of rate parity does not exist.
 
The goal, sources said, is to make sure the right product is in the right place at the right time. The process is helped by travel providers getting as much data as early as possible, said Nick Monaghan, sales director for strategic partnerships at Booking.com.
 
“Guest reviews and human interaction also remain central to growth,” he added.
 
The prizes and numbers are sizeable.
 
Scott Garner, chief commercial officer for Adara, said the company saw “13.5 billion bid requests daily that must be answered by an algorithm that then decides if that person can be contacted profitably.” His colleague Bernie Yu, senior VP of marketing, added that “consumers who see ads in multiple channels convert 24% more often.”
 
The metasearch and search-aggregator companies concentrating on retargeting, sources said, threaten to distance themselves from hotels far more rapidly than the online travel agencies ever did in regard to other recent distribution channels.
 
Big data players
Potential behemoths in the CRO game are Google and Facebook, which are amassing large amounts of “likes,” purchase histories and other personal information, which drive more targeted, tailored advertisements than do cookies that use guesswork stemming from website choices.
 
“Unless the cookie is absolutely relevant, I’m not so interested. What instead we want is to have the right, relevant message against the data we have,” said Alex Gisbert, chief marketing officer of travel provider lowcostholidays.com.
 
Conference attendees said Google still is learning how to better use its data to offer more targeted ads to advertisers.
 
“That’s a 10-year play in my opinion, but there has to be a paradigm change between maximizing revenue and (Google and other such companies) providing more value to advertisers before these advertisers run out of margin. Companies now claim it is cheaper to get a new customer through an indirect method than it is via a pay search,” said Bobby Healy, chief technical officer for car-rental booking system CarTrawler.
 
While Google is largely viewed as a sales channel, Facebook is not, Monaghan said. Healy suggested Facebook’s role for hoteliers and other travel providers is as a pure marketing tool to attract future guests.
 
Lee McCabe, head of travel for Facebook, during a telephone interview with HNN said that Facebook’s much-touted, personalized search capabilities Graph Search and Nearby Friends will transform how users book and do so using real data, not cookies, via “semantic” search. This uses previous online searches to better target what customers are interested in. Both initiatives are live but in testing.
 
According to eMarketer, which tracks online and digital developments, $17.96 billion was spent globally on mobile ads in 2013. It predicted that Facebook’s percentage of that spend would rise to 21.7% in 2014 (from 5.4% in 2012). Google’s percentage will dip as a result, according to eMarketer, but still will be approximately 47%. Facebook has more than a billion users.
 
Eighteen months into a newly created post, McCabe, too, encouraged hoteliers to put revenue into retargeting. He said hoteliers should be developing apps and mobile strategies with the goal of installing technology on as on many devices as possible.
 
“Personalized search is a huge opportunity and will only get bigger and more sophisticated. Most search engines do not know you, but that will change,” said McCabe, who declined to share traffic numbers for the initiatives.
 
Social media can be an effective marketing platform, but hoteliers often are guilty of putting too much emphasis on it to generate good reviews and thus sales, while  the businesses that do well do so because they have concrete, usable data on their customers that they can tailor and measure, McCabe added.
 
Don Birch, a partner in Travel Innovations Partners and an investor in booking technology, said during the Adara conference that content is getting deeper and the landscape more fragmented.
 
“The industry via big data now more than ever is in the position to generate relevance and increased value across the booking journey,” he said.
 
COMMENTS   Show All
Login or enter a name   Post Your Comment  Check to follow this thread via email alerts (must be logged in)
(4000 characters max)

Comments that include links or URLs will be removed to avoid instances of spam. Also, comments that include profanity, lewdness, personal attacks, solicitations or advertising, or other similarly inappropriate or offensive comments or material will be removed from the site. You are fully responsible for the content you post. The opinions expressed in comments do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Please report any violations to our editorial staff

TRENDING
How to get to No. 1 on TripAdvisor
5 changes coming in hotel financial reporting
Baha Mar’s setbacks point to larger issues
5 trends in hotel F&B profitability
5 performance trends in the top 25 US markets
Group business is back but changing
VIDEO
HDC attendees discuss revenue strategies
Hotel Data Conference: Day Two in review
Hotel Data Conference: Day One in review
NYU Investment Conference Recap
Hunter Hotel Conference postgame wrap
LATEST NEWS
Hoteliers react to sharing-economy competition
5 things to know: Alternative accommodations
The impact of the sharing economy on hotels
Top destinations crack down on Airbnb, others
Airbnb is an old idea with a new tech twist
An inside view of Airbnb in New York City
Contact Us
Hotel News Now
18500 Lake Rd.
Suite 310
Rocky River, Ohio 44116
        
Copyright © 2004 - 2014 Hotel News Now, a division of STR, Inc. All Rights Reserved.   Privacy