Boutique hotels and independents are banking on CRM-savvy website investments and personalization to drive direct bookings. Many are seeing remarkable payoffs as a result, and claim they are stealing chain-loyal customers away with enhanced personalization.
REPORT FROM THE U.S.—For hotels, it is often about location, location, location. But digital, digital, digital is now a vital mantra particularly for independent hoteliers when it comes to winning over customer loyalty and wooing direct bookings.
From Washington, D.C, to South Carolina to Santa Clara, California, many independents are counting on complex customer-relationship management systems and profitable upselling to convert potential guests with a customized experience.
By doing so, some properties have seen up to 30% increases in transactions, 40% hikes in website-fueled revenues and 20% conversion rates.
James Karabelas, VP of marketing at Aqua-Aston Hospitality, which has hotels throughout Hawaii and in Florida and Costa Rica, claims web investments have sparked a booking revolution in terms of hikes in website-fueled revenues and conversion rates.
“The newly redesigned website and booking experience has driven a 300% increase in mobile conversion, 69% year-over-year revenue growth, a 20% jump in rooms booked directly, and 50% hike in the average length of stay,” he said.
Karabelas claims the Honolulu company’s new digital showcase and booking engine is “an industry first,” aimed at boosting customer engagement with a deeply personalized online experience.
“We know travelers spend five months on average planning a trip and conduct approximately 50 searches across 700 digital touchpoints during that time,” he said. “The new site is much more than a hotel booking site, because it allows consumers to shop for travel based on the type of trip they want.”
“We developed a portal experience with extensive visual content, proprietary algorithms and expert information to help travelers through the dreaming, planning and booking phases, and curate trip itineraries based on their specific travel preferences,” he said, adding that it is very mobile-friendly.
The design of the website was built to “create a platform travelers could engage with in multiple ways, ultimately resulting in booking a vacation,” he said.
The intuitive, comprehensive approach generates consumers trust, Karabelas said, “encouraging them to book directly with us.”
Karabelas added that the site overhaul has been part of an overall rebranding, since Aqua Hospitality and Aston Hotels & Resorts merged in 2015.
“We have been working to maximize visibility while creating cohesive branding to elevate brand awareness,” he said.
By doing so, Karabelas said he feels he is gaining a competitive edge on big global brands by standing out from the crowd.
“We believe it’s becoming necessary for today’s hotel brands to stay ahead by enticing travelers in new ways,” he said. “By offering a flexible cancellation policy and exclusive benefits to guests who book direct with us, we can better cater to specific needs and improve upon the guest experience. Our guests love being appreciated with added values that enhance their stay, especially when it’s something they can’t get somewhere else – such as free scuba diving lessons at Aston Kaanapali Shores on Maui; or free cultural activities at Aqua Kauai Beach Resort on Kauai.”
Johnathan Capps, VP of revenue at South Carolina-based hotel operations management company Charlestowne Hotels, said website investments and a sophisticated digital strategy are now vital for independent hotels to counter the slipping profit margins caused by escalating commissions for online travel agencies, rising workforce costs “and costlier outputs on amenities and services expected by consumers.”
“When it comes to average value per booking, nothing beats booking direct - even accounting for online marketing and other expenses,” he said. “But in order to compete with OTAs, hoteliers must give potential guests reasons to book on their lowest cost channels. By integrating pricing strategies with loyalty programs, they can regain control of distribution, lower costs and provide a more satisfying booking experience to their guests. OTAs may have the advantage of quantity, but hotels have the advantage of quality.”
Capps said brands use complex customer relationship management systems to provide guests with “a customized experience with profitable upselling that ultimately allows the hotel to segment customers by lifetime value.”
“If done correctly, hotels could consider offering exclusively custom discounted pricing based on the profitability of their guests,” he said.
On joining the company, Capps said all properties get a new custom website “fully equipped with a proprietary analytics dashboard where corporate teams, on-property staff and other key stakeholders are able to review website performance in real time.”
“In 2017 alone, our internal marketing team developed more than 25 independent hotel websites,” he said.
Again, the payoffs have been significant.
“The majority of them have enjoyed major improvements to the profitability of their sites. As a result of our various digital investments and strategies, our independent hotels earn direct bookings at three times the national average,” he said.
In specific cases, Capps said The Spectator Hotel in Charleston, South Carolina, witnessed a conversion rate of +7.91%, a hike in transactions of +16.39% and revenue gains of +15.10%. For Charlestowne’s French Quarter Inn in Charleston, those figures respectively were +11.16%, +40.45% and +50.36%; at The Sewanee Inn in Tennessee, +19.83%, +27.10% and +37.46%.
The use of strong imagery is crucial, Capps said, and becoming more so with the astronomic rise in global internet users and marketing.
“This is one of the most important investments your hotel can make and is routinely ranked among the highest influencers of a consumer’s purchase decision. In fact, pages with images or video draw, on average, 94% more views than their text-only counterparts,” he said.
“According to an Expedia Media Solutions Study, today’s consumer visits as many as 38 travel sites before making a booking decision, which dramatically increases distribution costs,” he said.
But that digital power also been advantageous, Capps said.
“Enhanced consumer awareness has also led to the niches within in the industry, some of which Charlestowne Hotels excels in: boutique and lifestyle hotels, university markets and adaptive reuse projects. Equipped with research, travelers can be more adventurous in their lodging selection, allowing independent hotels more room to differentiate themselves through innovative programming and amenities,” he said.
The ten-year-old Jefferson Hotel in Washington, D.C., is aiming for web traffic hikes after launching a fresh site last year, said Meredith Goldberg, director of marketing and communications.
Pivoting on a complete revamp of the site, the hotel aims “to tap into a new market comprising a mix of millennials and baby boomers,” she said.
"In the first year of launching the new site, we’ve seen an increase of web traffic of over 15% and a 1% increase in our conversion rate,” Goldberg said.
She said the web refresh has seen page views spike by 35%, yet time on the site is down 20%, meaning time savings for a predominantly business clientele.
This tells us “that guests are logging on, finding what they need and booking without having to click around," she said.