Q1 In Review: What We've Learned About the Changes in Hotel Marketing
By Beth Harvey, Marketing Manager at Spring Engage
Over the course of the first few months of 2016, hoteliers around the world have noticed a shift in the industry. Throughout our research, we have highlighted four topics have been at the forefront of many independent and branded hotel's market discussions- the home sharing and OTA competition, business versus leisure traveler preferences, how to optimize loyalty programs, and the need to increase direct hotel bookings.
Home Sharing Economy
Two of the biggest factors affecting the hotel industry have been the rise of the sharing economy and the prominence of OTA's in the online travel market. With 60% of all hotel bookings now done digitally, Expedia and Priceline are leading the pack with revenues reaching $35 billion (failteireland)(MarketRealist.com).
Airbnb has created significant competition for lodging services, bringing in an estimated revenue of $900 million in 2015. It's growth is projected to continue as more millennial travelers are attracted to the unique housing options. With this new market, independent and boutique hotels must inform guests of the perks and amenities they will receive only from a hotel.
- Reliability: When guests book with a hotel, they have the luxury of knowing exactly what to expect when they arrive; no fear of cancellation, and more importantly no fear of fraud.
- Amenities: Many guests love the perks that only hotels can provide: room service, quick and on call maid service as well as the facilities like pools, workout rooms, and coffee shops.
- Location: Many times hotels hold better location compared to home sharing services as 74% of Airbnb properties are outside the main hotel districts.
- Rewards: Loyalty programs and stay rewards are one of the best ways to encourage visitors to choose an independent hotel over a home sharing service. Personalizing these programs to guests preferences can lead to an even better guest experience.
Business travel has been on the rise, projected at 480.5 million in 2015 (inc.com). Hotels need to take this unique opportunity into account for their marketing strategy. Targeting working travelers may be in the increase in bookings that your hotel is looking for. The trick is first knowing the preference differences between business and leisure travelers and then marketing to those guests accordingly by highlighting relevant offers. Here is what we found:
2. Internet Access
3. Loyalty Points
4. On-Site Amenities
5. Mobile Booking
2. Reviews & Recommendations
3. Comfort & Amenities
4. Nearby Attractions & Food
5. Packages & Specials
Loyalty programs are also on the rise, but only 41% of hotel chains reward customers for at least one form of engagement (Cap Gemini). More attention to personalization will be the key to a program's success, as 82% of consumers said loyalty programs would be better if they allowed them choose the categories of reward they wanted (Collinson Latitude). Forty one percent of millennials say they joined a hotel loyalty program because the rewards were easy to earn, proving simplicity is another important factor for customers. Millennial travelers are a crucial demographic to the hospitality industry with their increased travel spending and attraction to loyalty programs, as 63% of millennials said they had joined a program within the past year, versus 55% of the general population (Colloquy).
3 Ways to Faster Engage your Guests and Help Increase Loyalty Programs for Hotels:
- Specific Targeting
- Email Capture
- Initial Offers
When guests choose to come directly to a hotel's website to search and book, they are looking for a more personal experience. Independent properties should take advantage of the expertise of a hotel representative who can provide more flexibility in terms of a room choice, reservation changes, and price negotiations. The hotel agent knows the facility inside and out to provide the best recommendations for local restaurants and attractions, and accommodations for the guest.
Successfully deploying a direct booking strategy means increasing website personalization to ensure visitors are gaining access to direct booking rewards when it means the most. With site personalization, when a website visitor comes directly from an OTA or third party, hotels have the opportunity to give them a unique and targeted experience that encourages them to book direct.
Beth Harvey is the Marketing Manager for Spring Engage, a real time targeting and personalization solution that allows hotels to build better relationships with travelers. Beth graduated from North Carolina State University and resides in Raleigh, NC with Spring Engage.More from Beth Harvey
Focused on intentionality, the Spring Engage platform holds the tools for hotels to give site visitors the most meaningful and relevant expereince each time they're on site.