Myths and Hard Truths About Hotel Metasearch
Recently I saw a statement claiming that 75% of travelers use metasearch at some point during the planning process, which made the channel crucial for driving direct bookings.
There are three glaring inaccuracies in this statement:
1. No, 75% of travelers DO NOT use metasearch to plan their hotel stays.
Travel consumers do not know of and do not use the term “metasearch”! “Meta what? Isn’t this the new name of Facebook?” Most of them have not even heard the term.
Metasearch is a made-up term by Wall Street analysts, originally used for online retail from the early 2000s (remember ShopMania, Shopzilla, etc.?) when Amazon still wasn’t the powerhouse it is today. Later, the term was adopted by hospitality digital marketing agencies and hoteliers. Google doesn’t call their Google Hotel Ads (GHA) program “metasearch”, nor does Tripadvisor, etc.
Most travelers use Expedia and Booking to shop around and compare hotel rates. Asked “Do you use hotel rate comparison sites when planning your hotel stay?”, most of them would reply YES! This doesn’t make the OTAs to be metasearch sites since OTAs don’t feature rates from other hotel intermediaries.
In the last “normal” year in travel - 2019 - Google reported that travelers planning a hotel stay had over 45 touchpoints in their Digital Customer Journey before making a hotel booking. These touchpoints include OTA sites, hotel sites, customer reviews, social media sites, etc., sometimes visited multiple times and via various devices: smartphones, tablets, laptops, desktops. The picture will become even more convoluted going forward with the emergence of Airbnb and Hopper as full-fledged OTAs!
This type of traveler planning behavior is not metasearch, this is travel consumers shopping around like crazy!
2. Metasearch is no longer a DIRECT online channel
From a purely advertising channel, using typical ad formats like CPC and CPA, over the last few years metasearch has become a commission-charging, intermediary distribution channel, like the OTAs, bed banks, traditional travel agencies and tour operators.
Hotel metasearch has existed for over 20 years now (SideStep, acquired by Kayak), but has been elevated in importance ever since Google launched its Google Hotel Finder product back in July 2011, which later became Google Hotel Ads (GHA).
For many years metasearch players used predominantly the CPC (Cost-per-Click) model (Trivago, TripAdvisor, GHA, etc.). Later, most metasearch players introduced the CPA (Cost-per-Acquisition) model, in other words charge a fee in the form of a commission when a booking is done.
Responding to the travel slump, due to the pandemic and hotel cancellations reaching 50% because of ever changing travel restrictions, Google introduced its Pay-per-stay (PPS) model i.e. Google charges a commission only if the booker actually stays at the property. Recently Trivago followed suit and introduced its Net CPA program, which is a copy of Google’s PPS.
Why was this move by Google significant? Google now controls the lion’s share of metasearch, larger than all other metasearch players combined. Therefore, the commission-based Google's PPS, Trivago’s Net CPA, etc. should be treated not as an advertising channel, but just as another distribution channel like other intermediaries like OTAs, traditional travel agencies, etc.
In addition, Google now controls 91.42% share of the global search engine market (January 2022, Hootsuite). Google literally “owns” the travel consumer and has become the “shepherd of the digital customer journey” by positioning itself at and making money in the form of referral, CPC, CPM, CPA and CPS fees from each of the five phases of the Digital Customer Journey: Dreaming, Planning, Booking, Experiencing and Sharing Phases.
There is another wrinkle to the story: last year Google introduced free hotel booking links in its Google Hotel Ads (GHA) program. Google has been trying, quite unsuccessfully, for 11 years now to lure more independent hotels to join the GHA program. Now Google has resorted to its masterful freemium model: give every hotel a free booking link listing, flooding each destination with booking options thus forcing hotels, OTAs and other booking sites to compete for visibility.
Example, if Google lists for free all 700 hotels in New York City in its GHA, what chance does your property have to be noticed, unless it bought a sponsored listing i.e., a paid GHA listing? Nil.
The same underlying principle is used in the Google Ads Program (GA) and its sponsored listings (paid search) vs free/organic listings. Or by Expedia and its Travel Ads sponsored listings. Google's latest move is nothing more than returning to the old Yellow Pages business model: every business gets a free listing, so to stand out from the competition, you need to buy a sponsored listing.
3. Metasearch is a viable, but NOT a crucial channel.
And finally, how important is metasearch to hotel occupancy? The fact of the matter is that the much talked-about metasearch contributes to LESS THAN 5% of hotel roomnights!
The OTAs dominate metasearch with their multibillion-dollar marketing budgets so most referrals from Google HPA, Trivago, Tripadvisor, Kayak, etc. ultimately reach the property in the form of OTA bookings.
Recently I heard a hotelier boasting that most of his property’s online bookings outside of the OTAs came from metasearch. All 5 - 10 of them? I wouldn’t be surprised if this would be the case if you did not invest adequately in your property’s digital marketing and its formats: SEO, SEM, Content Marketing, online media, social media, CRM Marketing, targeting and retargeting initiatives, etc.
Is metasearch worth the trouble?
Yes, and there are two reasons for that.
First, due to consolidation in the online B2C marketplace, there are fewer and fewer online distribution channels left nowadays. Second, because by participating in Google HPA, the property “completes its portrait” on Google and provides an important information to potential guests.
Google has practically monopolized the Dreaming and Planning Phases and creates a big share of the “ready-to-book” customers in the Booking Phase of the Digital Customer Journey.
People use four criteria when searching Google to find the perfect property for their hotel stay:
- Location: Where is the property located and is it near the place I want to visit. Google Maps and Google Search provide the perfect answers to this question.
- Information about the hotel: Is the property boutique or branded, is it 2 or 20 floors, what are the amenities, is there dining, etc. By indexing the property website and outside content sources, which the hotel can vastly optimize via SEO and Content Marketing, Google provides an exhaustive information on the subject.
- Customer Reviews: What did my peers say about their stay: Google today offers more hotel reviews than all of the other review sites combined (not including Booking..com)
- Price: How much is this hotel per night - $100, $200 or $300, etc. By participating in Google HPA, the property provides an answer to this important question in real time!
How should hoteliers handle metasearch?
1. Conduct a Property Presence Audit on Google:
Start by searching your property brand name on Google. Audit, review and optimize your property’s presence on Google:
- Your property Google Business Profile: Is the information correct? When was the last time the profile was updated? Business hours? Amenities? Photos?
- When was the last time your property responded to Google Reviews? Google today controls bigger share of hotel reviews than all other review sites combined (excluding Booking..com).
- How does your property rank in the search engine results pages (SERPs) for the most relevant keyword terms that define your property? If you are not happy with the outcome, invest in website optimization, SEO and Content Marketing.
- Who is bidding on your property’s brand name in Google Ads? OTAs, competitors? Invest in branded keyword campaign for your property to disallow the OTAs to hijack your direct customers.
- Who is dominating your property listing in Google Hotel Ads (GHA)? Is your official site listing live and featuring the best rate? Are there any GHA advertisers not in rate parity?
Do you know how many hoteliers have done the above audit in the last 6 months? In the single digits! This type of review should become a weekly or at least bi-weekly task handled by the property’s RM or marketing team.
2. Join the Free Listings on Google HPA:
If your property hasn’t done so, I recommend you join Google HPA’s free property listings. You should not expect an avalanche of bookings, but this will complete your property’s profile on Google and greatly enhance your presence by placing your “Official Site” in the GHA pricing menu.
Quite often I hear the excuse that Google HPA is too technologically complex, and therefore independent hoteliers are shying away from the program. As a hotelier you don’t have to be technologically-savvy to understand that Google HPA is one of few remaining online distribution channels outside of the OTAs.
Joining Google HPA requires integration between your PMS, CRS, Channel Manager or digital marketing agency with Google’s backend so that Google has real-time access to your property’s ARI (Availability, Rates, Inventory). Ask your tech vendors to do the actual connectivity work. My former company NextGuest (now merged with Cendyn) built its API to Google Hotel Finder, now GHA, back in 2011. Thousands of hotel clients have been able to take advantage of GHA ever since.
Avoid the new Google HPA extranet tool that requires manual upload of rates and availability. Who has the time and bandwidth today to manually maintain ARI (Availability, Rates, Inventory) via an extranet in the back end of GHA? This is so …2003! If you are an independent hotel and your CRS, booking engine or PMS does not interface with GHA - fire them! There are plenty of CRS, booking engine, channel managers and cloud PMS vendors out there that are already interfaced with GHA to choose from.
3. Join the Sponsored/Paid Listings on Google HPA
If your property is in a competitive destination (who isn’t?), consider joining the paid/sponsored Google HPA listings in addition to the free property listing. Why? Paid/sponsored Google HPA listings (“Featured Options”) are served above the free listings and have much higher visibility than the free listings, especially on the small screens of smartphones. Today over 70% of searches on Google come from mobile devices.
In addition, the sponsored listing allows the property to include marketing messaging in the listing, promoting free cancellations, free breakfast, free Wi-Fi, reward programs, member-only perks and discounts, etc. Since all of your competitors already have or will join shortly the free Google HPA listings, you need a paid/sponsored listing in order to stand out from the competition.
Join Google HPA’s commission-based Pay-Per-Stay program and task your revenue management department to monitor and manage it like all other intermediary channels.
