Success In Internet Marketing

INTERNET MARKETING SOLUTIONS
for the international hotel industry

Success in Internet Marketing

TravelCLICK Webinar
May 2007

Jerome Wise
VP - eCommerce “there is a better way”


Agenda
• The importance of the Internet to the hotel industry
• How to impact the bottom line
• Taking a strategic approach to Internet marketing
• Building an Internet marketing plan
• The value of measurement and analysis


TravelCLICK’s experience
• Developed and hosting almost 200 hotel web sites
• Managing online marketing campaigns for over 300
hotels
• Clients range from individual 2 star hotel to worldwide
major luxury brands
• Delivered approximately $12 million in incremental
business to our customers over the past 12 months


The importance of the web
• Online is no longer a niche channel worthy of
investment for the future.
• It is a significant channel now and should be actively
managed.
• Worldwide online travel sales is valued at $147 billion
in 2007*
• Forecast to grow at 17% per year over the next 3
years*

*source PhocusWright Inc 2006


• Online travel sales will represent 41% of total travel
sales by 2008*
• A further 38% of consumers make their decision
online, but purchase offline**
• This means that almost 80% of travel sales will either
be made online, or strongly influenced by online

*(Europe) source eMarketer
** Forester Research 2006


• Supplier sites are fighting back against the OTAs and
in 2005 57% of online hotel sales were made on the
supplier site, up from 53% in 2003*
• This is forecast to grow further as suppliers catch up
with the OTAs in terms of technology, customer
service and marketing

* comScore Networks, April 2006 (US)


Where are the opportunities?
There are three main opportunities that online sales
present:
1. Incremental revenues
2. Reduced cost of sale
3. Enhanced brand loyalty and client relationships


Incremental revenues
• The internet is a level playing field in terms of sales
and marketing
• Everyone can attract new clients through very targeted
and measurable marketing
• Global distribution reach is available to all, not just the
major brands that have global networks


Reduced cost of sale
• A brand web site has the lowest cost of sale
• Enables business to be “channel shifted” from more
expensive channels, such as travel agency or call
centres
• A strong brand web site enables the reliance on OTAs
to be reduced and relationships to be renegotiated in
order to bring down the overall cost of sale


Consumer
Spend $150.00 $275.00 $275.00 $275.00

Travel
Agent

Booking
Engine
GDS Provider

Pegasus
Brand / Brand /
Rep Co. Rep Co. *
Brand or
Rep Co

Net $250.00
Revenue*
$90.00 $206.25 $235.50
Develop strategies and employ specific tactics to
*industry averages shift business mix to the most profitable channels


Enhanced loyalty and client relationships
• A direct client should be retained for future marketing
and relationship building
• A customer booking through an OTA is likely to remain
loyal to the booking channel
• Actively seek to build relationships with clients
delivered through OTAs for future, cheaper marketing


How to drive incremental revenue
• What are the various marketing opportunities?
• What is each of them good for?
• Where should the focus be?


The marketing opportunities
• Before looking at the opportunities, one should
consider the four stages of customer interaction:
– Conversion
– Acquisition
2. Acquire
– Retention
1. Convert
– Analysis
• Focussing in each of these areas
4. Analyse 3. Retain
will create a solid action plan


The marketing opportunities
• Equal focus and specific activities should be deployed
to address each of these key areas:
Convert Acquire Retain Analyse
Web design SEO CRM Web analysis
Booking engine PPC Web design
Content Linking Customer service

2. Acquire
1. Convert

4. Analyse
3. Retain


Site conversion is key to success
• Before investing in marketing efforts, a web site should
be “fit for purpose” to convert at the highest rate
• Increasing the conversion ratio of visitors to bookers is
the single best investment
• Once the site is optimised, then marketing activity to
deliver incremental consumers should start

1. Convert


What does an optimised site look like?
• Does it represent the brand in a clear and compelling way?
• Is the navigation easy and logical?
• Are there overt booking arguments (best rate guarantee, online-
only offers, exclusive promotions)
• Is the content fresh, up to date and compelling?
• Is the “book now” button clearly displayed on every page?
• Is the booking process simple, quick and efficient?
• Is there an easy process for capturing email addresses, with
clear rationale for consumers to provide their details?
• Is the most relevant information displayed “above the fold”?
• Are online security fears addressed?
1. Convert


Measuring site conversion is essential
• Site conversion should be measured every month to
ensure optimum site performance
• Measuring Visits, Persuasion and Conversion will give
an accurate picture of site performance
Total site visits

Total number of
availability enquiries
Total number of
completed reservations
1. Convert


Driving incremental traffic to the site
• Now the site is optimised and performance
measurement is in place, it is time to deploy marketing
efforts.
• Two distinct plans should be put into place to target:
– New and incremental customers
• Search Engine Optimisation, Pay-Per-Click, Linking
– Existing customers
• Email Marketing, Offline Marketing, Customer
Service
2. Acquire


Why are search engines important?
• 89% of Internet users regularly use a search engine
• In Europe, Google accounts for 76% of all searches
• In Asia Pacific Google accounts for 67%
• In the US Google accounts for 49%
• It is important to know where users are searching to
adjust the approach accordingly


New and incremental customers
Search Engine Optimisation:
• Definition: the process of improving the volume and
quality of traffic to a web site from search engines via
"natural" ("organic“) search results
• SEO is the single-most important online marketing
activity
• The benefits of a well “SEO’d” site will be dramatic
• This is a strategic activity, that will deliver significant
long-term benefit
2. Acquire



Natural search results

PPC Results


• SEO does take up to 4 - 8 months to make a
significant impact
• The best results require an iterative process, not a
one-time effort
• Ensuring high-quality incremental traffic is delivered is
vital
• For short-term, tactical, traffic deploy Pay-per-click
marketing as a complimentary activity
2. Acquire


• PPC is a fantastic medium for turning on traffic
immediately
• A well-researched PPC campaign will deliver
significant returns and will quickly become an ongoing
activity
• PPC campaigns compliment SEO activities
• Running SEO and PPC side-by-side, ensures that you
own the page
2. Acquire


Top left is the most valuable area of the page


TravelCLICK PPC Campaigns
• In 2007 we are running approximately 40 campaigns
• Forecast to generate:
– $8 million incremental revenue
– 13,000 incremental reservations
• Year to date, we are delivering a 8:1 ROAS


Existing customers
• Existing customers are often overlooked in the fervour
to find new ones
• If managed effectively they can:
– Reduce the overall cost of sale through channel shifting
– Increase their loyalty and value
• Communication of the online proposition in an offline
environment is vital
• Regular, and relevant, email communication will build
loyalty and reinforce the brand
3. Retain


Existing customers
• Building the customer database is very important and
can be achieved relatively easily:
– Sign-up process on web site
– Run online promotions / competitions
– Sign-up at check-in / check-out
– Ensure offline communication encourages email sign-up
• A communication calendar should be developed to
ensure regular emails are sent with compelling offers
3. Retain


Measurement and analysis
• Online offers unparalleled measurement and tracking
opportunities
• There are three key areas to measure:
– Site conversion
– Site performance
– Marketing return

4. Analyse


Measuring site conversion is essential
• Site conversion should be measured every month to
ensure optimum site performance
• Measuring Visits, Persuasion and Conversion will give
an accurate picture of site performance
Total site visits

Total number of
availability enquiries
Total number of 4. Analyse

completed reservations


Site performance
• Correct use of the web site analysis tool will show:
– Where are customers visiting from
– Where are they leaving the site
– How long are they staying
– Which search engines are delivering the traffic
• This information will assist in changing the web site to
meet the customers’ needs 4. Analyse


Marketing return
• Return on investment (ROI) or return on advertising
spend (ROAS) are the most common metrics
• Equally important is the contribution that marketing
efforts make to the overall business
• Other performance metrics to consider are:
– Cost-per-acquisition
– Number of email sign-ups 4. Analyse


A simple spreadsheet gives a dashboard view:

4. Analyse


Why TravelCLICK?
TravelCLICK is your ideal online marketing partner
• 21 years experience in hotel electronic distribution
• Specialist Internet Marketing Services team working
only within the hospitality sector
• Offers a full service suite of Internet marketing
solutions
• Ongoing relationships with over 12,000 clients
worldwide
• Shared interest in your success


Summary
• Today up to 80% of all bookings are influenced by the
web
• A strategic, planned, approach to online marketing will
produce far better returns than tactical activity
• Investing in existing customers, as well as prospecting
for new ones, is crucial for overall success
• Measuring performance and adjusting campaigns will
produce stronger returns

Success In Internet Marketing

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