In-Depth: Interview with Barbara Pezzi, director of Web Marketing & e-Commerce, Fairmont Raffles Hotels

"The whole last-click attribution debate is slightly overhyped"

IN-DEPTH: Interview with Barbara Pezzi, director of Web Marketing & e-Commerce, Fairmont Raffles Hotels

By Ritesh Gupta

Search engine marketing is complex but it is luring simply owing to the fact it can be measured to a large extent.

Barbara Pezzi, director of Web Marketing & e-Commerce, Fairmont Raffles Hotels, says she doesn't find SEM any more complex than offline advertising, which is basically just "faith based".

Search is considered to be an option for its ability to target at a very granular and specific level. Search as a standalone channel is known for delivering tight cost-per-acquisitions.

Pezzi, who is scheduled to speak at the forthcoming two-day Online Marketing and Social Media Strategies for Travel Summit Europe 2010 (5-6, October) to be held in Prague, spoke to EyeforTravel's Ritesh Gupta about online advertising, search as a branding tool, bid management and lot more. Excerpts:

Firstly, with the development of technologies such as social media, rich media, dynamic creative and online video, there is no shortage of ways in which travel advertisers can build brand awareness and brand loyalty. Do you believe that travel advertisers have evolved to completely see the benefits of branding online? Do travel advertisers still hold online advertising to an ROI metric and not a brand metric?

Barbara Pezzi:

It depends on the size of the advertising budget. If budget is tight, ROI will probably be the main goal of the campaign. Social media can be very cost effective, but it does require a dedicated human resource to make it work and that is not always available. I would not agree that online branding is not seen as important. I just believe that the travel industry as a whole, excluding a few players and of course the OTAs, is still not very advanced when it comes to online marketing and is still figuring out where to best allocate budgets and resources. Hotels in particular are very traditional in their sales and marketing approach. Things are changing, but possibly not as fast and widely as they should.

Overall, what makes search an attractive marketing tool in today's context?

Barbara Pezzi:

I love search. It is quick to set up, 100 percent accountable and such a good source of consumer insights. I spend hours looking at our search queries to identify trends, understand what consumers are looking for these days, what is driving them to our competitors' sites, testing different ads, price points, landing pages and so on. I do not think there is any other tool out there which gives you this amount of information, on both your customers and your own performance, and can be continuously refined, tested and measured.

An ad in a glossy magazine can be somewhat measured with a dedicated phone number and vanity URL, but in reality, you never really know if customers liked it, saw it or even remember it a week down the line. With search, you can test a few ads and landing pages all the time and as long as there is good measurement in place, you know what worked and what did not. And of course, the added bonus is that, when done right, the ROI is great too.

Specialists also point out that as a branding tool, search is not so efficient and depending on the industry, an advertiser's ability to convert high core generic activity may actually depend on their brand being recognisable outside of the search environment. What's your take on this?

Barbara Pezzi:

I agree to a certain degree. Good brand awareness certainly does help with clickthrough rates and often results in higher conversion on generic terms. On the other hand, I think it is still quite an even playing field. If your ads stand out, your landing page is well designed and your site works, you have every chance to get that 1st click. It is then up to the advertiser to convert potential customers. If budgets permit and you can afford to be highly visible on 80-100 percent search queries, constantly, then search could be seen as an awareness tool, but it would be a rather costly exercise and not necessarily the best option. I see it more as an effective tool to find and convert new customers, rather than brand building.

Often, the online industry attributes the last click to search. Though search is a key component in any travel marketing plan, there could have been a number of other media driving a consumer to search for a particular brand or destination. Specialists like Greenlight say when combined with display, search can have significant lift in brand awareness, message recall and purchase intent. What do you make of this suggestion?

Barbara Pezzi:

I think it very much depends on the ad network, the country of booker and quality/size of the display campaign. We had good successes in North America. I am probably in the minority here, but I do believe that the whole last-click attribution debate is slightly overhyped.

There are still many companies out there who just measure "hits" or "page views" and don't do any real analysis or testing. To me, this is more of an issue than the even figuring out what the best mathematical percentage should be when it comes to success attribution. I am not saying that search should get the credit for everything, and we do track all the touch-points involved in the purchase path, but there is yet no way of knowing if the original query was initially driven by other external factors, such as having seen the hotel on an OTA page, on a friend's Facebook status or in some travel guide. I think the focus right now should be in having the best accurate measurement and testing in place to establish which media model mix works best within the available budget, rather than dwelling on what percentage of credit should be given to the 1st, 2nd or 3rd click. Display or even search might not always be the answer.

Regarding SEM, an executive mentioned that considering that two hotel properties are so different -- yet they are often held to the same ROI metric, have the same bid or fall under the same business rules at the bid management firm. This approach could be better, if it was possible to micromanage ROI on a per property, per day, per customer, per search basis; getting there in a scalable manner will improve SEM for the travel industry. What's your take on this?

Barbara Pezzi:

I agree. We do not have a blanket approach when it comes to SEM and ROI targets are set based on each property needs, budget, location, and other unique criteria. Portfolio bid management (same bid rules for a group of properties) would only be in place if the same person owns a set of properties and has requested for the campaign as a whole to have a certain ROI target.

An executive from Expedia pointed out: The long tail is just getting longer. To manage it, you have to have significant ability to scale your programmes and the ability to manage bids through ambiguity and data sparseness. It's difficult to set a bid for keywords that get a click every other week or month. It's even harder to bid millions of keywords like this. Oversimplifying, suppliers have two choices -- spend on salaries & marketing dollars directly against acquiring these more expensive conversions or allow resellers to bear the burden and cost. How do you assess the situation?

Barbara Pezzi:

The long tail is indeed getting longer, but I see it is an opportunity to gain conversions at much more reasonable CPAs, rather than an obstacle. Bidding on "hotel+ city name" is hardly viable in most cases, due to very high CPCs and low conversion rates, and those are the terms which we would often leave to the OTAs to bid on. 3-5 words searches allow for more cost effective bidding and better targeting. It is slightly more time consuming to set up, but at long as the campaign is structurally well built, with tight ad groups, it is much more effective than sticking with a few generic terms, or even worse, a few generic terms set on broad match. I do not see it as an either/or situation. OTAs definitely bring value when it comes to promoting the hotels online, as long as they do not bid on the hotel's brand terms, if not simply for the fact that in many cases their site offers more language options and therefore allows hoteliers to promote their properties in markets where they are not active online. However, this does not mean that hoteliers should give up and just rely on resellers to manage their online presence. It is still very feasible to have successful online campaigns at margin lower than the average OTA, even taking into account bid management and/or vendor fees.

Online Marketing and Social Media Strategies for Travel Summit Europe 2010

Barbara Pezzi, director of Web Marketing & e-Commerce, Fairmont Raffles Hotels is scheduled to speak at the forthcoming two-day Online Marketing and Social Media Strategies for Travel Summit Europe 2010 (5-6, October) to be held in Prague.

For more information, click here