By Max Starkov
Yes, it is that time of the year again. Next year’s marketing budget is on the line and hoteliers are frantically trying to pick the top revenue-generating initiatives to focus on during 2013.
This year, Google says 94% of travelers are accessing hotel information online, and PhoCusWright says 55% of all leisure and business travel bookings will be done online, so, the online channel is where your potential guests are. No wonder Starwood Hotels & Resorts Worldwide announced earlier this year that 75% of its brands’ marketing would be spent in the digital space.
Yet, this year U.S. marketers will over-spend some $20 billion (according to KCPB) in print advertising, and under-spend the same amount in Internet and mobile advertising initiatives.
The never-ending stream of new online “next-big-thing” business models, travel sites and networks can make it difficult to decide which initiatives will help your business and which are wastes of money. Below I have provided guidance on how to structure your property’s digital marketing budget in 2013. The budget should focus on driving direct online bookings by channeling your initiatives into one of three “silos”: core marketing campaigns, business needs-driven marketing campaigns, and capital investments, consulting and operations.
1. The core digital marketing campaigns (recommended share of the 2013 digital marketing budget: 50%-60%):
This portion of the budget should include year-round digital marketing initiatives, which are proven winners regardless of the economy or latest trends.
Search-engine marketing on Google and Bing/Yahoo;
search-engine optimization initiatives, such as new content creation or inbound linking initiatives;
cost-per-click programs such as “show prices” CPC program on TripAdvisor;
soLoMo (social, local and mobile) allows the hotel to deliver personalized content to guests and customers in real time;
mobile website and mobile marketing has earned a spot in the core initiatives, with U.S. bookings via the mobile channel expected to exceed $2.16 billion in 2013, according to PhoCusWright;
remarketing and retargeting. The Google Display Network offers the ideal balance of re-targeting text ads and banner ads;
online videos of your hotel and its amenities influence travel decisions and increase conversions on the hotel website; and
online reputation management and presence in leading social media and review sites.
2. Business-needs driven multi-channel digital marketing campaigns (recommended share of the 2013 digital marketing budget: 20%-25%):
Business-need campaigns help the property tackle business and occupancy needs that arise because of seasonality, group cancellations, occupancy issues or other customer segment needs.
Multi-channel marketing campaigns are the most effective way to address a business need, increase reach, and boost bookings and revenue for a need period.
For example, say Property X needs to drive leisure bookings for the upcoming month because it just realized the hotel is only at 60% occupancy. The hotel could create a campaign with a limited time offer and drive consumers directly to the property website via SEM; SEO; online media; email marketing; travel consumer deal alerts; mobile marketing; social media; and interactive initiatives, such as generating buzz with contests or sweepstakes.
3. Capital investments, consulting and operations (recommended share of the 2013 digital marketing budget: 25%-30%):
This silo in the 2013 budget includes initiatives that are necessary to keep your website healthy, such as website redesigns, enhancements and technology upgrades, as well as initiatives that don’t produce direct revenue yet are essential to the success of your property (consulting, analytics and hosting). Scrimping on these initiatives can jeopardize the performance of all other budget line items.
Naturally, maintaining the hotel website remains of paramount importance to hoteliers—anything you do online today leads back to the website. In addition, hoteliers need to tackle a major new challenge: creating and managing digital content throughout three distinct distribution channels (desktop, mobile, tablet).
It is not just about having any hotel website. Today's hotel website needs fresh content, rich media and current promotions. The hotel's special offers, promotions and packages need to be marketed across all channels, from the desktop website to the mobile site and social media. Your old and tired 1- to 2-year-old website cannot possibly meet the new requirements and most likely has dropped off the map, experiencing deteriorating conversions, bookings and search rankings.
In 2013, the hotel’s digital marketing budget should be separated into three silos. The core of the budget should focus on return-on-investment-driving basics; include flexible funds for unforeseen challenges and business-driven needs; and set aside a portion for website upkeep and operations.
Max Starkov is President & CEO of HeBS Digital, a full-service digital marketing and direct online channel strategy firm based in New York City.
HeBS Digital has pioneered many of the best practices in hotel Internet marketing, social and mobile marketing, and direct online channel distribution. The firm has won over 200 industry awards for its digital marketing and website design services.
Max has spent 30 years in hospitality and travel, with an extensive Internet marketing and online distribution experience. He co-founded and served as CEO of three e-commerce travel companies: Travelbreak.com, WhaleMedia.com and HeBS Digital. Max received the HSMAI “Top 25 Most Extraordinary Minds in Sales and Marketing” in 2008 and since 2010 has been serving on the HSMAI Digital Marketing Council. He has an MS in Economics of International Tourism & Hospitality and an MBA degree, Beta Gamma Sigma Honors, from Fordham University in New York.
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