FIRSTEVER HSMAI HOTEL INTERNET MARKETING STRATEGY CONFERENCE HSMAI January 19, 2004 FIRSTEVER HSMAI HOTEL INTERNET MARKETING STRATEGY CONFERENCE DELIVERS INDUSTRY PERSPECTIVE, ISSUES & ADVICE ON TOP ISSUES Featured Keynotes from Branding and Legal Experts; Executives at Leading Hospitality Companies, Intermediaries and Search Engines as Panelists MCLEAN, VA (Jan. 19, 2004) – The firstever Hospitality Sales & Marketing Association International (HSMAI) Hotel Internet Marketing Strategy Conference held recently in Miami exceeded expectations in its objective to deliver an intensive, informationrich program of the important and timely issues impacting hotel Internet marketing. Debating hot topics, such as keyword bidding and pop ups and pop unders, was an impressive lineup of panelists representing executives at major hotel brands, leading search engines and third party intermediaries as well as keynote speakers addressing the consumer perspective, legal issues and brand protection. “The worldwide web and Internet marketing is undoubtedly the hottest topic that should be top of mind for all engaged in the sales and marketing process,” says Robert A. Gilbert, CHME, CHA, president and CEO of HSMAI. “What this debut conference delivered was a wealth of information, advice and lively debate about Internetrelated issues that have a huge impact on the way hotel products are marketed, distributed and sold.” “As the mission of the HSMAI Hotel Internet Marketing Committee is to increase awareness of issues, opportunities and trends, as well as develop and recommend standards and ethical guidelines as it relates to hotel Internet marketing, we have already seen positive reactions from search engine companies as well as some of the Internet merchant models. This is a first step in the right direction to leverage the Internet as an effective marketing medium for the hospitality industry,” says Jens Thraenhart, director of Internet strategy at Fairmont Hotels & Resorts and global chair of the HSMAI Hotel Internet Marketing Committee. The following are highlights from the day’s agenda: In the opening keynote, Brian Murray, author and vice president of client services, Cyveillance, addressed: “Defending the Brand: Aggressive Strategies for Protecting Your Brand in the Online Arena.” Key points: Defending the brand can protect the customer experience, reduce the cost of fulfillment, and drive incremental revenue.
Hospitality brands are abused prolifically online to divert customers and capture revenue. With diversion tactics such as cybersquatting, typopiracy, mislabeled links, false advertising, and search engine manipulation, diverted customers are converted into revenue through competitive offerings, referral fees, commissions, and affiliate programs. Brands continue to be affected by the same tricks, from capturing customers that type in the wrong destination, to spam email and mislabeled links send customers to the wrong place and search engine manipulation stealing search traffic – all undermining the customer experience. To take action on paid placement and adware offenses: Include compliance guidelines in partner agreements; prioritize the most actionable infringements (deceit, use of trademark in title, partner violations); contact the bidder/advertiser; contact the host/facilitator (Overture, Google, Claria, WhenU, etc.). To manage risk and maximize ROI: Prioritize brand abuses to determine where you should target monitoring efforts; prioritize infringements with direct revenue implications (high traffic, hospitality sites, direct competitors, etc.); communicate property guidelines and enforce compliance (improper branding, mislabeled/broken links, competitor, etc.); brands whose core values are family/trust oriented should monitor aggressively for fraud and association with objectionable content; implement programs that leverage and reward stakeholders, such as employees, partners and customers, to report on issues such as spam and pricing in terms of lowest rate guarantee. In each of the two panel discussions, keynote speakers set the stage for issues as they relate to the consumer marketplace, followed by a panel of industry experts representing hotel brand Internet marketing executives, intermediaries and search engines. The sessions were moderated by Dr. William Carroll from the School of Hotel Administration at Cornell University. ISSUE 1: Trademark Protection To address “Trademark Protection and How it Relates to Consumer Perception” Peter Greenberg, The Travel Channel and NBC Today Show travel editor, talked about full disclosure, truth in advertising and truth in pricing. Greenberg said the challenge in the hotel industry is not to follow the lead of the airlines, which have become a commodity and therefore consumers don’t value the brand. Airlines have lost control of their CRM, and below a certain price point, travelers are not interested in the experience but only care about going from point A to B. It’s all about the math, says Greenberg, and while initially consumers are price driven, it will ultimately be about credibility. He believes websites should be free of pop ups, keyword diversions, or other placements or links for ads. If you want to sell a commodity all you need is price. It’s not just about selling, but returning. If you deliver on the promise, and do the math, consumers will respond, notes Greenberg. In a related panel on “Trademark Protection & Keyword Bidding on Search Engines,” participants included: Gino Giovanelli, vice president, eBusiness solutions, Carlson Companies; Michael Menis, director, global marketing services, InterContinental Hotels Group; Don Smith, vice president of sales, Worldres; Scott
Hyden, general manager, Travelweb.com; Jeff Johnson, search media director, iCrossing; John Moran vice president of operations, FindWhat.com. Panel observations, issues and comments: Managed correctly, keyword bidding can be extremely effective to generate sales as you only pay when someone clicks on your site and is delivered to your property (Moran). There’s no better cost effective way to advertise as you don’t pay until traffic comes to you. (Johnson) It’s an art and science; an incredibly powerful tool that will drive business but it can be expensive if you don’t know what you’re doing or monitoring it well by analyzing ROI and track bookings. Highly sophisticated, it takes a dedicated person to manage. (Moran) Tracking ROI is imperative to see what is working and which keywords should be used to optimize a campaign. Aside from having people dedicated to the process, outside support is available from third party software, programs from intermediaries or outside experts (Johnson). In 2002, 40% of traffic to the Radisson brand site came from search engines, and keyword bidding ranked the highest accounting for 20 to 25% of traffic. In 2003, other means of search engine tactics proved better, such as direct submissions. To round out a threepart optimization strategy, initiatives now include emphasis on natural submissions (Giovanelli). Issue: A concern is that consumers intending to go directly to a branded site but through a search engine get routed to a third party – the highest cost of sale channel. The idea of intermediaries is to drive incremental business, not take away sales that were meant to be booked directly (Menis). Issue: When searching for a brand site, such as Radisson, and the result is a third party site, if you click on that page there is a spectrum of competing hotel brands as opposed to the desired brand’s page within that site (Giovanelli). Issue: Advertising claims that don’t represent the full inventory. For example, if you enter a brand name the result may be brand advertised as 70% off. When choosing that, if those few rooms that were allocated are no longer available, it will indicate sold out and offer a different brand (Menis). A suggestion was made, and a poll of attendees confirmed a strong interest for search engines adding logos/seals to identify official sites. Have concrete agreements with your distribution partners and suppliers on what they can and cannot do, such as prohibiting search engines selling branded keywords to third party sites (Moran).
We’ve migrated from keyword buys because the ROI is not there, and consumers are figuring out that sponsored listings aren’t delivering the results they’re looking for. To track performance and monitor ROI: tag keywords and see what people are doing when they enter the site and monitor keyword buys (Giovanelli). ISSUE 2: Pop Up and Pop Under Marketing Andrew Sherry, USA Today.com offered “A Consumers View on Pop Up and Pop Under Marketing.” Recognizing firstoff that it is “the most annoying form of advertising” according to the Internet Advertising Bureau (IAB), he notes that there is a narrow area where users will tolerate it and it can be effective. Though if you step beyond those boundaries there can be a backlash. Sherry says that consumers want to feel in control of what they want, when they want it, particularly in their personal space results, and the intrusion sparks a negative emotional reaction. However, he notes there are times when something “pops” that is useful and won’t produce the same consumer reaction. It’s about finding the right zone, and for USA Today it is to only serve pop unders, and to limit that to two per session. “If travel advertising is presented in the right manner, it can be valuable content to the consumer,” says Sherry. “Pop ups may be effective and will add value when the information is relevant and valuable without being too obtrusive, particularly if it comes when you would be looking for it.” In the discussion on “Pop Up and Pop Under Marketing,” panelists included: Michael B. Wylie, vice president eCommerce, Wyndham Hotels & Resorts; Jens Thraenhart, director of Internet Strategy, Fairmont Hotels & Resorts; Pete Haggerty, director of sales, Claria Corporation (formerly Gator); Jacques Hart, Travelzoo; Emily Schubert, director, search and content operations, Travelocity. Panel observations, issues and comments: Pop ups are effective when they are relative. Being a behavioral marketing company, Claria’s approach to pop ups is that we provide target users with messages that match their behavior. It’s all based on permission, attribution and control (Haggerty). It’s the type of pop up and the accompanying message – be it branding or transactional with specific offers – that makes it effective (Hart). Travelocity no longer uses pop ups and we only dedicate a small budget to pop unders, focusing on branding, packages and the total travel experience. We monitor it very closely and if the ROI isn’t there, we prefer to spend it on search or offline (Schubert). It’s all about success metrics, effectiveness and return. With the apparent success of companies like Orbitz using pop ups and pop unders, we decided to do a small test with pop unders. We excluded competitor sites and tested it several ways. Interestingly enough, experimenting with adding an 800 number on a pop under for an
Orlando property has yielded excellent returns; however, it is too early to tell if we will continue using this medium (Wylie). We don’t use pop ups and we are mindful that this practice can potentially dilute the brand – Fairmont is a luxury product and popups have the perception of being budget oriented (Thraenhart). We’ve invested significant money creating an online experience at Fairmont.com and it’s very troubling when pop ups appear on our home page or deeper in the site, interrupting the experience and attempting to lure away potential customers. It also becomes a consumer trust and confidence issue (Thraenhart). Pop ups on one’s own home page can be quite potent when the information is relevant to the user – Carnival Cruises has had great success with this (Hart). With pop ups, we’ve taken the partner angle and when products invade our space we’ve approached those companies with success (Wylie). A growing concern and controversial issue is when pop ups invade a competitive domain. We’re concerned with users being swayed by discount offers popping up, but more importantly, it diminishes the online experience, may interrupt the booking process and the user thinks it was generated by us (Thraenhart). All our agreements address predatory marketing tactics and the bigger online partners have stopped when we bring it to their attention. It gets more difficult when working with their affiliates as there’s less control (Wylie). The consensus was there needs to be a coming together as a group to define and communicate ethical standards and guidelines – a common voice to address the space and keep the dialog continuing. Closing the program, Peter Ripin, attorney at law, Davidoff & Malito LLP, advised on “Domain Name Piracy.” “There are many different strategies to deal with domain name piracy, but there are also a number of pitfalls, so weigh the pros and cons carefully before embarking upon a particular solution,” says Ripin. The AntiCybersquatting Piracy Act prevents a party from registering in bad faith a domain name which is identical or confusingly similar to an established trademark. To protect domain names, Ripin recommends registering all business and domain names used with the Patent and Trademark Office, across as many top level domains as possible (.com, .net and .info, etc.) and those doing business abroad should register in appropriate foreign countries. Also, register slogans and variations of the hotel’s name as well as natural misspellings and grammatical alternatives to deter typosquatters. Also, use a track and monitor system to see if your names have been registered by others. If someone has, the action depends on the circumstances. First see if you can strike a deal with the domain name owner or offer paying some money to the owner
(the obvious disadvantage is it puts you in a position of “rewarding” a cybersquatter which may set a bad precedent). Failing that, send a ceaseanddesist letter. If that is ignored, there are two options for a legal challenge. First, bring a lawsuit alleging violations of the Anti Cybersquatting Piracy Act and the other trademark infringement statutes, or take the quick and inexpensive approach with a specialized type of arbitration proceeding specifically designed to deal with domain name piracy disputes – file a complaint under 10 pages, pay a filing fee of approximately $1,500 per domain name, and the other side then has 20 days to file an answer and you have the option of filing a reply within five days thereafter. The arbitrator issues his ruling two weeks later and, if you win, the domain name is transferred to you within 10 days of the decision. Sponsors of the HSMAI Hotel Internet Marketing Strategy Conference are Hotelrooms.com, a major web based search engine; VFM Interactive, a leading provider of interactive content solutions for the lodging and travel industry and RealMagnet, a prominent email, fax, survey company. Attendees represented eight countries with participants from the U.S., Canada, Australia, England, Japan, Mexico, the Bahamas and Spain. Earlier in the year, Internet marketing specialists from leading hotel companies united under the auspices of HSMAI to form a committee dedicated to the most pressing and topical issues facing the industry as it relates to Internet marketing. Prior to the Strategy Conference, which was organized by its Advisory Board and HSMAI, the committee held monthly phone forums to debate and address pertinent issues. Resources for Hotel Internet Marketing professionals can be found at the group’s website: www.hotelinternetmarketing.org. The committee’s Advisory Board members for the Americas are: Jens Thraenhart (global chairman), director of Internet strategy, Fairmont Hotels & Resorts; Michael B. Wylie, vice president eCommerce, Wyndham International (chair, Americas); Gino Giovannelli, vice president, eBusiness strategy, Carlson Companies; Michael Davis, director of interactive strategy and development, Ian Schrager Hotels; Michael Hayward, director, marketing planning and automation, Four Seasons Hotels and Resorts; Michael Menis, director of global marketing services, InterContinental Hotels Corporation: James Zito, manager, interactive marketing and development, Affinia Hospitality; and Bill Carroll, Ph.D., visiting assistant professor, School of Hotel Administration, Cornell University. The committee is also currently organizing an advisory board for Europe/Middle East, which will be headed by Euan Mitchell, director of eCommerce, Thistle Hotels, and Peter O’Connor Ph.D, associate professor, IMHI/Cornell. In 2004, HSMAI will step up its interest in the strategic solutions business by holding five Strategy Conferences, each serving unique markets and industries within travel and hospitality. They include: AirlineHotel Contracting (February 1921 in Miami), Hotel Internet Marketing (April 21 in New York in conjunction with Travel Commerce Expo; May 12 in London in conjunction with HEDNA and December 10 in Los Angeles in conjunction with HEDNA); Revenue Management (June 21 in Dallas in conjunction with HITEC); Industry Outlook Strategy Conference in partnership with NYU (September 23 in New York).
********** HSMAI is an organization of sales and marketing professionals representing all segments of the hospitality and travel industry. With a strong focus on education, HSMAI has become the industry champion in identifying and communicating trends in the hospitality industry, while operating as a leading voice for both hospitality and sales and marketing management disciplines. Founded in 1927, HSMAI is an individual membership organization comprised of nearly 7,000 members from 35 countries and 60 chapters worldwide. For more information on HSMAI, contact the Hospitality Sales & Marketing Association International, 8201 Greensboro Drive, Suite 300, McLean, VA 22102, phone (703) 6109024; fax (703) 6109005. You can also visit the website at www.hsmai.org.