Industry Update
Opinion Article29 August 2019

America or Asia? The surprising truth of metasearch success

By Rob Funnell , Content & Product Marketing Executive at Triptease

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The potential customer's searcher region is a particularly unique variable when it comes to a metasearch auction. It's one of the few factors that doesn't just increase the value of your guests, but actually impacts who visits your hotel. We've previously looked at the significant impact that ad position, device type and the day of the week can have on acquisition strategy, but the region of the searcher is a substantially bigger challenge for hotels. Not only must the individual impact to your specific hotel be constantly calculated through new and historic guest data, but wider global political, social and economic trends must also be carefully considered.

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Unlike other metasearch multipliers, region also requires the most hands-on approach in order to ensure success, and must also be analyzed in a slightly different way. Between February and August 2019, we compared the cost per click, click through rate, conversion rate and return-of-ad-spend (ROAS) for Triptease customers across five regions on Google Hotels Ads. This includes the Americas (consisting of both North and South America), Europe, Africa, Asia and Oceania. Compared to the other factors we've considered so far, as region consists of a fixed number of qualitative categories we are unable to draw any long-term trends beyond the six-month snapshot of the data set. As a result, hotels must be proactively looking at region data on a regular basis to truly understand how it can impact their metasearch bidding strategy.

Exploratory research or real intent to book?

Firstly, comparing click through rate with conversion rate tells us about a region's particular approach to metasearch - are they often using it as a point of exploration, or are they only clicking on an ad when they are genuinely likely to convert? It's immediately clear that the Americas are a particularly strong region when it comes to metasearch - with the highest click through rate of 4.80% and an equally high conversion rate of 6.07%, American searchers see metasearch as a crucial part of their booking journey. With the astonishing growth we've witnessed on Google's metasearch platform over the past two years, this result is hardly unexpected.

However, it's Oceania that provides the most interesting set of results across our data analysis. While their click through rate of 2.99% is relatively standard compared with the other regions, the conversion rate is by far the highest at 7.08% - over 1% higher than the Americas. While this dataset may be heavily skewed by Australian users, this could potentially mean that people searching from Oceania have far greater intent to book when they click on a metasearch ad, or maybe that they are more likely to be decisive upon reaching the direct site. This can only be determined through comparing metasearch acquisition analysis with a hotel's unique on-site conversion data and guest information, and is a crucial part of meta success.

Across the other regions, it's interesting to note that Asia is the only area where click through rate exceeds conversion rate. This is potentially because the metasearch landscape is more varied in this region, and as this analysis consists of findings from Google Hotel Ads, we may be seeing this specific platform being used more as a research tool than strictly a booking mechanism. As the metasearch platform evolves, adds more features and becomes even more integrated into Google's travel plans, this could change overnight - hotels need to be monitoring both their data and wider meta industry trends to ensure the most accurate bidding.

That said, Asia did receive over double the number of impressions than Oceania did, underlining the importance and scale of metasearch within the market. At the other end of the spectrum Africa had both the lowest click through rate and the lowest conversion rate of 1.41% and 1.61% respectively. With a substantially smaller sample size of impressions and conversions than the other regions, it's hard to draw solid conclusions from this. As a result hotels should approach their regional strategy based on their own unique conversion rate data across all distribution channels.

Does a high ROAS result in more bookings?

A fundamental trend that governs acquisition strategies around the world is that as cost goes down, ROAS increases. The reality of metasearch is not that simple. Not only does a high ROAS not necessarily lead to a high volume of bookings, but our analysis also does not show the inverse relationship between cost and return that we would normally expect. To easily compare ROAS across regions, we've given each country a ROAS Index Score. This shows the relative return on ad spend compared to the best performing region - in this case, the Americas, which has a score of 1.

What we can see from our short-term data study suggests that when cost per click goes down, ROAS also decreases. Across Europe, Africa and Asia, the ROAS Index Score declines by 0.1 as cost per click also falls by $0.34. Africa is particularly noteworthy, with a ROAS Index Score of 0.87 - only 0.02 off that of Europe - whilst having the lowest conversion rate and click through rate. This has to mean that the actual value of bookings made by searchers from Africa are far greater than that of Europe or Asia, although the smaller sample size and regional variance means a more focused approach within your own data is needed to be sure this runs true for your own hotel.

However, the Americas subvert this trend, as they top the charts for both cost and return. An average cost per click of $3.10 is more than double that of Europe, Africa or Asia, yet the Americas also have the highest ROAS. With such a relatively high cost per click, this is unexpected, and defies the trend we have seen across other regions. However, when taking into consideration the region's relatively high click through rate and conversion rate, it makes much more sense. This is the clearest example of how metasearch data should never be taken out of context, and how one metric cannot be viewed in isolation. Spending more on each click can still provide a greater return if those clicks are resulting in a significantly higher number of conversions.

It's interesting to note that, while Oceania had the highest conversion rate in the previous graph, it also has the lowest ROAS out of all of the analyzed regions - with a ROAS Index Score of only 0.76. Oceania has the second-highest cost per click at $2.71 - only $0.39 off that of the Americas - so why doesn't it have an equally high ROAS? While there are many factors in play, it's likely because Oceania doesn't get the same volume of conversions as other regions. Even if each metasearch auction in Asia is significantly less likely to lead to a booking, the cheaper cost per click means the same number of conversions could be achieved with even less of an investment.

How to reach the next level of metasearch sophistication

End-user country or region is a fascinating way of looking at macro trends over large areas. It can have a far more tangible impact on not only the number, but also the actual demographics of guests who are staying at your hotel. Even beyond the acquisition stage, regional data can have a dramatic effect on every aspect of your hotel - from your on-site conversion strategies to the offline experience you provide for each guest. Broader regional data can be a powerful tool but you need to continuously analyze how guests from each individual country - or even city - interact with your hotel's online distribution channels, and dynamically alter your metasearch bidding strategy based on this.

Above all else, all bid multipliers and success metrics must be viewed as part of the greater metasearch puzzle. No one factor looked at over the course of this article series - whether that's ad position, device type, day and month or searcher region - is useful on its own. Each of these elements is entirely unique to your hotel; each must be monitored constantly as they change over time, and each factor must be balanced when deciding how much to bid. The analysis we have conducted should be what your hotel looks at on a daily basis. While a great strategy can take considerable time and effort, metasearch is the most powerful online acquisition tool you have at your disposal. It's time to start making the most of its potential.

This is the third entry in the Surprising Truths of Metasearch series of articles - if you'd like to read more, see how other factors such as ad position, day of the week and more can impact your meta strategy.

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Rob Funnell

Rob is a Content & Product Marketing Executive with Triptease, and loves helping hotels attract and convert direct bookings, cats and loud music.

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