Industry Update
Opinion Article 5 December 2017

A day in the life of a paid marketing ‘war room’ – Interview with Calvin Anderson

By Jeremiah Magone, Marketing Director at Hospitality Copywriting

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Magone

I got a chance to talk with Calvin Anderson, Senior Vice President and Chief of Revenue Optimization at RLH Corporation, recently.

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Read the following transcript for an inside glimpse into his evolving philosophy of how hotels can win in an era of Big Data and stiff competition.

Jeremiah

Thank you so much for your time today, Calvin.

Calvin

Glad to be here. This is awesome.

Jeremiah

This is our second chance to talk. The first time I followed up after you gave a presentation to the San Diego HSMAI. I love the progressive thought you bring to things. And so I just wanted to catch up and hear more about your average day. What is the 'making money hand over fist' revenue optimizer's day like? Can you tell us about that?

Calvin
Yeah, absolutely. So the unique part of my role, as opposed to maybe a more traditional VP of Revenue

Management, is that I really do run the customer acquisition process for the entire enterprise.

As a brand chain, we franchise a bunch of hotels. We also manage a bunch of hotels and then even owned a series of hotels, so it's sort of three companies in one. And then from that perspective, the goal is to drive really intuitive, intelligent customer acquisition efforts which ultimately include revenue management, sales, distribution strategy and the customer acquisition piece of marketing, which I often call media buying or direct response marketing.

So, ultimately, me and my really excellent team… our goal is to make the most out of what we can in each piece of that for the entire enterprise.

And so, my day actually starts… because right now, I'm an analyst – if you know anyone I'm looking for a super brilliant sidekick – by updating our enterprise data warehouse workbooks and just reviewing the performance for the portfolio in the last 24 hours.

So it's kind of a 'come in, lock the door, find out what trends we're looking at' process. I'll pull up our Google Analytics or Adwords… all of our attribution modeling dashboards… and I usually spend the first hour, hour and a half, each day, really just orienting myself to all the trends that are going on.

We use Tableau as a data visualizer on top of a conglomerate of data sources, from simple things like budget and the use of Star, to market rate shops and to every kind of block group blocking data to raw booking data and of course CRM and marketing analytics data.

And so, I usually start from a world that says, historically we're used to being served up a series of dashboards or reports that confine you to the questions that they have predetermined you should ask, right? The amazing thing with how powerful Big Data is now… I can take our over 1,100 hotels and

start asking the questions I want to ask, starting at a macro level and drilling down uniquely into each area based on the trends I see. So, you could argue, for example, I might look at Google analytics and starts to see how many visitors, how many conversions, and how much revenue is coming to the website in the last couple of days, and what those conversion costs are, and I may transition over to Adwords to see what kind of campaigns we're running… how well they're doing... and what the cost of those campaigns are, and then I'll go measure that by what I'm showing in booking data actually materialized, which sometimes can be balanced by cancellations or whatever it is.

But I want to understand: am I getting more bang for my buck or less, and then from that direction, for example… pretend my booking data showed really heavy conversions through direct channels maybe CRO (Conversion Rate Optimization) and brand.com, but my AdWords shows that I'm not getting my conversion levels really high but I'm not spending very much. What I might say is, "What is giving me that incredible conversion at such low cost?" And then I would immediately reach out to my customer acquisition media buying team and say, "Hey guys, we're killing it with these areas, let's spend a ton of money here until we see this immediately stop."

And so, ultimately, I orient myself with what is really going on in all customer acquisition for the entire

organization and then I go about the rest of my day, which of course is consumed with calls and meetings and organizing to make sure everyone's doing the same thing in the right streamlined direction.

I sometimes joke that I have 30 balls in the air at any time, as if I'm juggling, and so when ball number one comes back from the 30, I just slap it hard and make sure it's moving fast.

And so, the rest of the day is managing people and teams and process, but I refuse to start the day without personally orienting myself with everything, so that I, hopefully, know as much as anyone else in my team about what's going on. How's that for an answer!

Jeremiah

That's a really holistic view and a very strong cup of coffee!

Calvin

Ha ha!

Jeremiah

It has to be really exciting…

So, can you tell me a little bit about what makes the perfect team chemistry for you? What's the excitement level like in the room?

Calvin

So, it is. It's certainly a unique group of people that I really need in order to deal with me... and not everyone is really a fit… hehehe... and it really boils down to; I need people that have a fire in their belly, and they have that 'figure it out' ability; which is to say that everything we're doing is new and inventive and it really is not something your ten years at Hilton or Marriott or Starwood are going to teach you.

For example, our reporting. We generally don't touch Excel, except for data cleansing or background. We use totally new tools. We use totally new applications. It's a totally different mindset for how you need to manage the business intelligence I give you. And it's so complex, in my opinion, that if you don't have a hunger and desire to become great at it and to fully embrace it, you're not going to be a fit because we don't have a secondary option.

Take our enterprise data warehouse. With all this data right now, maybe it's a third of the way built out to the way I want to see it - and it has maybe a hundred plus tabs in it.

So there's a real methodology behind it but, unfortunately, some of my new hires will say, "Oh my God! It's so exhausting... It's so much!" And there's a huge desire to go back to a standard, thirteen-row Pace

Report and my response to them is, "The data has always been there, you just haven't been able to look at it. It's been like having an encyclopedia and all you're used to reading is the glossary. It's always been there, you've always chose to see a summary or an aggregate or a roll-up, right?"

And so the idea - I really believe the future of data management - is not a world where you're going through a series of static dashboards, it's a world where you ask the question. You go into the resource, and create the answer on the spot – and maybe never look at that same resource the same way again.

And so, the tool is kind of an encyclopedia, right? Because if you know what you're looking for you can quickly find an answer.

That's why I'm enormously against the idea of being on a strategy call and saying, "Let me get back to you next week on that..." You shouldn't have to do that. You can answer almost anything you can imagine as long as you know how to navigate it live, on the spot.

Jeremiah

Wow! That sounds very exciting. And you've said that you've set up your office kind of like a paid marketing 'war room'… you used the 'word war' room, which I think is great.

Calvin

Yeah!

Jeremiah

Can you tell me a little bit about that mentality?

Calvin

Yep. It is. Again, it's just this idea - so traditionally a lot of digital marketing... and I don't want to say just the hotel industry... I think it stems far beyond the hotel industry... while my exposure, of course, is mostly hospitality… digital marketing has lived in a world where we put in a strategy that's static, right? ...for

customer acquisition, marketing or media buying… and we come back a month later and we say, "You know what, I really didn't like "Hotel RL near the harbor" as a phrase. It only got us this many clicks, this many conversions, and the ultimate cost per conversion was $37, so let's spend less on that," because we have seven other terms within our budget that we could make more money on, right?

That's the old-school way of doing it. It's 'let's put out a campaign or a Facebook ad and

put five hundred dollars a day on it and watch what happens', right?

And that mentality is so vulnerable to optimization.

And you know, marketing used to be color palette picking, right? And creative. And it still is - I mean a good color palette is good, don't get me wrong... you should see my bedspread… but the reality is that what really matters is if it converts, right? If there's a direct response that really drives your purpose.

And so, even in the way I relate to our creative agencies, I tell them, "If you don't convert... I'm

literally going to measure out how much time you spent into it, what I paid you to create it, and what it got me... and if those numbers are bad there's going to be a vulnerability here."

So, it's a super heavy-pivoting mindset. And that applies to anyone that's an agency for me… anyone on payroll for me. And so I need a super-creative, open mindset that is ready to pull the plugs immediately...

And just like you would be changing pricing and yielding all day long in Revenue Management, it's the same application in marketing and media buying…

And you're also focusing on the need periods, which is, "We're not paying for bookings when we already have strong direct bookings over a compression period. We should be looking to fill the holes more and more, as much as possible."

Or, if there is compression, but it's coming heavily through more expensive channels, we might then fight for our deeper share of that period. But, you know… I do… I like to call it a Wall Street day trading war room. That's kind of the mentality, right? Which is: it should be just as aggressive in pricing and yielding as it is in media buying, and I need inventive people that are on the frontline in order to do all that.

Jeremiah

And can you tell us a story about one day that you had a really fast pace operation with great returns in your 'day trading', as it is?

Calvin

Yeah. So, we've been dabbling in social a lot. It's a remarkable application when it comes to your ability to target, right? And the more you can target, the more you get in a qualified audience which means better conversions at lower costs.

So, a couple of my favorite things with social is pre-loading marketing campaigns based on possible scenarios such as hurricanes or snow storms or fire storms. Events that a clear customer pattern is obvious, right? So, if I already have a relationship with an aid organization where we say, "Hey, we want to be able to donate ten dollars for anyone that books with us, when we decide to turn that on, and there's a hurricane heading for Florida and I can see this makes perfect sense, then I say, "Let's launch a campaign that targets non-Georgia residents on Georgia freeways that are driving north... which likely means they're escaping a hurricane. The city is not going to be so compressed, as far as we can tell, that

it's going to sell out naturally, so we do want to shift share. But we also don't want to be punks, and so what we're going to do is give you $10 off and donate $10 to that aid organization for every room that you book with us… so we have a relevant message.

no matter what would happen. So, those kind of events... when we've already prepped, and we get to use our campaigns for the first time, those are some of my favorite examples of staying ahead of the market.

Jeremiah

Wow, that's great messaging. You're providing convenience. You're doing some social good. You're really helping out your revenues... I love how you have that in the chamber, ready to go.

And now, I want to ask; do you have any words for general managers who might listen to this?

What type of words do you have for them to help them understand how you run your campaigns? And how you do your budgeting..? Anything like that?

Calvin

You mean our general managers, how do we communicate to them, is that right?

Jeremiah

No, I mean, more generally. For example, for San Diego HSMAI hoteliers who might be listening to this, and they love the aggressive take you have on marketing, but sometimes they might be a little hesitant to put a lot of money into pay-per-click... Do you have any words of wisdom that you can give them to show how to work with Revenue Optimizers, like yourself?

Calvin

Yeah. So, you know, it actually sort of reminds me of my personal investment strategy, which I would argue most people should take the same philosophy… which is: you should never invest in something that you don't know anything about, right?

The sum degree, or the total amount of time you spend researching your investments, that's about the same level you should probably invest at, right?

So, Bitcoin maybe sounds great, but if you don't know anything about Bitcoin, I don't recommend anyone invest in Bitcoin until they've done the research to really, confidently be proud of their investment and understand the way it's going to move, so that they know how to manage it from there on.

And so, I don't recommend anyone touch Pay-Per-Click or social advertising unless they're educated in it – because you're probably going to lose a ton of money super-fast – or there's a risk of doing that and you could argue that if you didn't, right away, you might just be lucky.

So, very much like the market, I never tell my friends what they should invest in unless they've done the research themselves. In the same regard, if you want to commit the time to researching it and understanding it, then, by all means! What you should do is look for a couple of awesome resources... this sounds like a great area of resources that you provide, or probably a great way to at least spark people's interest and gain deeper insights... which are podcasts. I am a huge podcast listener. And I've got a few of my favorites… a few people that I follow that really seem to be cutting edge in this arena.

That's the way I educate myself so I'm in front of the curve… I know what's going on… and I know no one is hoodwinking me so I can keep creating the best results with our marketing budget, right?

That budget comes from our franchisees, after all. They all pay a franchise fee, and so I have an obligation to get as many dollars back for them, on their behalf. And we take that really seriously.

And then the only other thing, I guess, I would recommend, if you did educate yourself enough to start playing in that arena is, know that the minute it stops making money you can unplug it.

For example, there are days that AdWords spend literally gives us junk for returns and we will just shut it all off, immediately, and start spending somewhere else. If we can get 10 to 15 channels running... I mean, literally, all day is just choosing who's giving us the most and I don't care. We don't have to buy a term that doesn't return anything. If I'm getting 20:1 somewhere else, and buying "Red Lion Anaheim" gives me nothing, we're going to just shut it off and put that spend somewhere else.

And so, I would say, give preference to what gives a return. Educate yourself, and podcasts are an amazing way to do it. I think those are a couple great steps to help you improve your marketing.

Jeremiah

Awesome practical advice. Any career advice for Revenue Managers?

Calvin

Yeah, I've been saying this for a long time.... and I get booed off the stage for it 50% of

the time… but if you are not absorbing yourself in digital marketing in attribution modeling, in analytics and data visualization tools and other platforms, and how to use them, you're going to be flipping burgers in five years. So, I mean, you've just got to get up to snuff in these arenas.

And we've kind of heard about Big Data, bla bla bla bla bla...

Well, we now have the actual tools to really do stuff with it, no matter what your resources are, in a lot of cases. And so, for a while, a lot of people heard stuff and were handicapped and couldn't do anything

about it… but now we're in a place where you really can.

And so, if you... I mean depends on what your ambitions are, I suppose... but if you want to have a long, happy career in Revenue Analytics and Revenue Strategy, I think it's worth the investment, even if you are funding it somewhat yourself, to self-teach, which is this remarkable resource we have now, right?

So, you can go to college or university... but a lot of these professors... I mean, this stuff changes every month or two… And so, there's this beautiful opportunity to be as educated as the best of them with these applications and tools just by YouTube videos and bloggers and self-education.

That's why, if you're not doing that, you're making an enormous mistake that's going to cost you.

And I'll just tease you with a carrot on the other side, which is to say, really good Revenue talent has been consistently, grossly underpaid. And it is going to become really obvious how valuable that human asset is. And I believe we're going to have a massive swing of higher compensations that's going to draw really aggressive talent.

And that's what I mean when I say, "out of a job." It's not like there's no one going to be working it, it's just going to be the Silicon Valley and the Wall Street talent that's going to come into those positions in the hospitality industry. It's going to be led by ownership groups that all of a sudden wake up one day and say, "Oh my goodness! We have a 200 million-dollar asset being led by someone paid ninety thousand dollars with no experience in high-deep analytic tools!"

And from an investment point of view, you wouldn't do that, right? It doesn't make sense... And it's odd that this is one of the only industries that we still have that pattern in place.

And so, I think people are going to wake up and they're going to find the talent. And that talent is going to run the show and it's going to be really apparent who's using the right talent and who isn't.

So get on board. It's a beautiful time to do it. There's still a little bit of bandwidth and runway, because, I think, in a couple of years we're going to be missing half of the players that are in the game right now.

Jeremiah

Well, you said there's a carrot on the end, it sounds a lot more like a

candy apple!

Calvin

Yeah, no! I'm serious, I think it's... it's going to be really cool.

Jeremiah

Well, we're right at the 30-minute mark, I know you're very, very busy, so I'll

let you go. And I just really want to say thanks so much for your time, Calvin.

It was so cool taking a glimpse at what a day in the life of a really aggressive revenue optimizer, like yourself, is like. Thank you so much.

Calvin

It's a pleasure. Glad to be here.

Jeremiah Magone

Jeremiah Magone is a direct response copywriter specializing in the hospitality industry. His interest in the industry stems from living all over the States, parts of Europe and his most recent 8-year stint in Japan. He is the author of the 300% More Direct Bookings in 30 Days social media marketing system and Hospitality Marketing Synergy, which shows hotels how to improve their group sales results by creating win-win partnerships.

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