The addition of third-party intermediaries as well as search and social experts is complicating the booking process, leaving hotel marketers to ponder the value of partnerships.
MINNEAPOLIS, Minnesota—Selling a hotel room directly to a traveler is a pretty simple and straightforward process. But the addition of third-party distribution, search-engine optimization and social media is complicating the process and leaving hotel marketers wondering how they can best take advantage of partners.
Representatives from Google, Expedia and Facebook shared how the respective companies help sell hotel rooms during the Hospitality Sales and Marketing Association International’s 10th Revenue Optimization Conference this week.
Lee McCabe, head of the global travel marketing vertical for Facebook, said there is a lot of business model crossover between the three parties. Specifically, “travel search will become more social and become more personalized,” he said.
SEO and SEM practices
Ed Tapan, account executive at Google said Google sees the travel funnel in five steps: dreaming, research, booking, experience and sharing.
“We now know social is a big component to travel,” he said.
Therefore, Google has taken a number steps to integrate user-generated content into its search results. Recently, the company introduced what it calls a “carousel” in hotel search results, which is a stream of photos that appears at the top of the page along with addresses and user-review information. The presentation is meant to capture eyeballs, Tapan said.
“It’s organic, meaning there is nothing you could do to get your hotel listed in the carousel,” he said. “If you have any marketing behind Google then the user will see an ad for your hotel (underneath). Right below that there’s paid search and also organic search and Google Maps is integrated as well.”
Tapan said travelers visit Google during any one of the five phases of search, but probably most often during the research phase. Then they go to the booking stage, he said.
Recently, Google found a way to put Hotel Price Ads—which offer real time inventory and rates—directly into Google Maps. Along with YouTube, tying hotel content into Google Maps will be a near-term focus for the company.
Another continuing focus for Google Travel will be mobile, as the company has seen 56% year-over-year growth on mobile hotel queries, Tapan said. With Google Now, the company has the ability to deliver boarding passes directly to travelers’ phones.
The company also will focus on last-minute bookings, which it sees as a “no-brainer,” Tapan said, although he admitted that HotelTonight is “dominating the space.”
How can hoteliers work more closely with Google to ensure they are taking advantage of the search giant? Provide data, particularly loyalty data, Tapan said.
“If we can marry data together, we can bring a ton of personalization and hit home on the five points of the travel experience.”
As confident as Google is that its social strategy will work with Google+ being integrated into all other aspects of the company’s efforts, other companies are clearly paving the path.
Travel has never been more open and travelers have never been more connected, said McCabe of Facebook.
“Facebook and social have disrupted the paradigm,” he said. “Sharing is now at the heart of every stage.”
McCabe said Facebook sees another stage to the travel process: a final stage he refers to as “reflect.” The reflect stage, he said, is a huge catalyst to enticing another travelers’ dream phase.
Facebook is beta testing two travel projects currently: Graph Search and Nearby. Both serve up personalized search results that integrate friend reviews and recommendations into search results. A Facebook Graph Search will show users hotels friends have stayed at and hotels friends have reviewed.
While Nearby is “pretty good,” McCabe said, it’s still in ramp-up stage. “I test it in every city I go to and now the top five hotel results are hotels in my interest,” he said.
McCabe said the most interesting challenge facing travel marketers today is the evolution of brand loyalty.
“Price is becoming harder and harder to use as a marketing lever. With location, users need to research more,” he said. “But branding—just ask millennials how they feel about brand loyalty.”
Facebook’s immediate focus will be on creating targeted advertising opportunities for hoteliers, McCabe said, adding: “You can really target very specifically.”
Facebook Exchange, which is a retargeting option that serves up advertisements to users who searched a hotel but did not book, is leading the way for retargeting campaigns, he said.
“The key to retargeting is getting that message to that person as soon as possible. It’s no good two weeks after,” McCabe said. “Because people are very frequent users of Facebook, the majority of those ads will be seen within an hour. If you get targeting right and the message is right, you’ll see the results.”
OTAs driving results
The traditional online travel agencies continue to play an important role in hotel room distribution.
“We have invested heavily in the mobile space,” said Nick Graham, senior director of global market management at Expedia. “This isn’t just a local trend, this is a global trend.”
Graham said Expedia expects mobile usage to triple by 2014. He said 18% of all Internet transactions will be done on a mobile device, which includes smartphones and tablets, over the next year.
On top of that trend, Expedia is placing a large emphasis on its global demand. More than 50% of the hotel bookings in New York alone are coming from global travelers, Graham said.
“The way you distribute to an international customer is different,” he said. “They stay longer, they book further out, they’re more likely to book through packages and they’re more likely to buy a more upscale hotel.”
Graham cautioned that the number of metasearch players in the hotel industry is likely to grow.
“TripAdvisor moved from strictly advertising to metasearch,” he said, as an example. “Meta is really growing in the face of the customers. They offer more depth of inventory than any single OTA can.”
Graham said hoteliers should be present in any channel that’s popular today; however, that can be both costly and difficult.
“You want to look at how you surface in these channels,” he said. “You want to make sure the prices that appear are the prices you want to appear.”