REVENUE MANAGEMENT “A typical hotel is spending 20 times too little on promoting its offering. If you are part of a chain it is probably 10 times too little. How many hoteliers use Google Analytics? Probably a lot but how many have looked at it in the past 48 hours? Not many, so hoteliers are not using the data they are collecting to best advantage.”
(l-r): Martin Soler, CMO, SnapShot, Dr Peter O’Connor, Professor of Information Systems at Essec Business School, France, and Dr Des O’Mahony, CEO, Bookassist.
one bite whereas the OTA has multiple bites. It is all about seeing, understanding and using your data because if you are not doing that you can be sure that the OTAs are doing it.” Dr Des O’Mahony, CEO Bookassist
#OTA
penetration
42%
of US online bookings are direct
26%
of European online bookings are direct
36% of bookings worldwide were online in 2015
Worldwide online bookings are expected to grow by
39% in 2017
to make direct business front and centre of your entire strategy and use OTAs for specific aspects and to fill gaps. You have to leverage OTAs appropriately rather than having them leverage you. Also, get visible – you have to maximise conversion and control distribution. This is a good direct strategy but it involves a lot of work on different fronts. Do you have the budget to do all that is necessary? If you move just one booking a day from Expedia or booking.com it frees up money that you can invest in your business. A hotelier is looking at 20,000 over a year which they invest and use to build up more direct bookings that generates the profit they need to grow their business.” He advised the small independent hotels to investigate ways of using their own data to reduce their dependence on OTAs. “Also, you need the best website available, not the best that you can afford, and you need to differentiate your business online and offline,” he said. “Conversion is critical – you have
CONTENT DRIVES SEARCH Peter O’Connor gave the hoteliers some advice on how to compete more effectively. “Search positioning remains the critical issue,” he said. “28 is the number of pages that Google claims a typical hotel customer looks at before they make a booking. Less than one third of consumers start searching by using a name. So what drives search? Content drives search, it causes conversion and earns engagement. If you have the right content on your page in the right format you will get searches. You must produce detailed, unique, organised and topical content.” He was critical of most hotel website content, and demonstrated how unfavourably the content on a typical hotel website compares to the content for a hotel on booking. com. “Financial controllers in hospitality need to change the way they look at their budget processes and consider spend on a cost per acquisition versus return basis as opposed to a pre-defined budgetary expense,” he said.
USING YOUR BIG DATA Brendan May, VP of Strategy for Snapshot, told delegates that the ‘always on’ guest probably has more data on their hotel than they do. “And they have read all the bad reviews that we were afraid to read,” he said. “Customers want to be treated like royalty, and in order to do that we need to interpret data more quickly and identify trends. The hotelier needs to ask ‘what data do I need to make better decisions? What is the information I need to make decisions 95% of the time?’ Why are we not using the data we have? It is hidden in databases, we have to pay to get it in and out, we have stupid passwords for PMS, Google Analytics and Facebook Analytics, and a lot of boring statistics. The hotelier needs to have access to and understand their data and take some of the advantage away from the OTAs who spend all of their time analysing all of the data that they own. In 2010 there were 10 billion computing units worldwide – one per person – and now everyone has more than one, so the Internet of Things is on the march. It is probable that every industry in the world knows more about their clients than we do. Hotels are the second oldest profession yet we aren’t using the data that we have.” Des O’Mahony told delegates that 40% of Priceline.com’s revenue is coming from loyalty clubs. “The data they are using is already pulling revenue out of your hotel so hotels need to harvest the data generated for their own benefit,” he said. “The loss of customer data to OTAs diminishes your ability to get in front of the customer.”
FEBRUARY 2016 | HOTEL
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