How Hotels Can Bridge the Conversion Gap
By Kelly Robb, Director of Business Development at Revinate
Data can help
Hotels have a wealth of data at their fingertips - browsing and purchase patterns, past stay history, guest preferences, online reviews, survey responses, and loyalty program data, just to name a few. The challenge is that leveraging all of these data elements can be a daunting task for any marketer, particularly marketers at smaller hotel brands and properties with far fewer resources and capital than the larger chains.
Engagement to conversion
Generally, the world of hotel software breaks down into two primary segments: Conversion and Engagement.
Conversion is all about driving bookings. It includes areas like advertising, websites, booking engines, channel management, and revenue management.
Engagement is all about maximizing the value of the hotel-guest relationship after the initial booking has been made. It's where a lot of the emerging action is in hospitality tech, given the changing nature of guest expectations. It includes areas like pre-stay/in-stay guest communications and experience, reputation management, surveys, and loyalty marketing.
The critical dimension that has traditionally been missing in this vision is connectivity, or the conversion gap, between Conversion and Engagement initiatives. Historically, guest insights have not been used effectively to drive new business acquisition or booking conversion. How might this virtual barrier be broken down? Three examples to consider are website optimization, customized pricing, and look-alike advertising.
A hotel's website is a cornerstone of marketing operations. Not only should it define and reflect your brand, it should be highly functional and easy to use. Some hotels go one step further by optimizing the browsing and booking experience for specific guest segments. You have a short (and diminishing) window to capture guest attention and mindshare, with so many booking options available in the marketplace.
Some companies are helping hotels use data to optimize booking conversion by integrating wide-ranging data elements, such as device, browser tabs open, cookie data, and even location, to help inform the optimal conversion experience.
The Revenue Management space is also evolving, with Revenue Management Systems (RMS) and Revenue Managers getting smarter about the inputs used to inform pricing decisions. For example, many hotels are starting to use a reputation-adjusted Best Available Rate (BAR) to identify and take advantage of opportunities to raise rates when outperforming competitors. Some RMS are also starting to ingest CRM data to help hotels use customized pricing to incentivize their best customers to come back and book direct. For example, a hotel could offer a known customer a rate 10% below BAR, or offer a top on-property spender a rate 20% below BAR. Rich guest profile data could even drive smart pricing for room upgrades and ancillary revenue (spa, restaurant, etc.) based on guest preferences and spend.
Hotels often turn to retargeting to generate bookings. But, retargeting only reaches customers who are already familiar with the brand and have recently been on site. So, how does a hotel find new customers? One option is look-alike advertising in which hotels, or media companies they work with, identify customers that look most like their loyal and valuable guests.
However, just because someone has similar attributes to those that a brand cares about doesn't mean he or she is looking to travel in the near future. "With intent-based advertising, you can reach people already in market for your property that may never have directly interacted with your brand," says Melissa Stein, Senior Vice President of Product at ADARA, a travel intelligence software company. "By leveraging global proprietary travel data, brands can drive efficiency and increase their business performance."
In summary, there are new, lucrative opportunities emerging across the hospitality tech ecosystem. As a hotelier, starting to connect what you know about your existing guests can help unlock new segments and drive higher booking conversion. Software platforms can help stitch together both engagement and conversion data to maximize the value of your guest knowledge and relationships. An initial booking is just the beginning of a much greater opportunity to optimize everything you do for your guests, including your website, your pricing, and your marketing/remarketing efforts.
Director of Market Intelligence - Revinate