An Initiative Team helping hoteliers to grow together with Digital Ideas & Technology
Management of World Choice Hotels Private Limited - An Initiative Team helping hoteliers to grow together with Digital Ideas
Innovations to the hospitality industry over 2015 are making a substantial impact on the outlook for hotel marketing in 2016. One of the largest and most obvious shifts in the industry stems from the creation and success of the sharing economy. Forbes estimates the revenue flowing through the share economy directly into people’s wallets will surpass $3.5 billion this year, with growth exceeding 25% (Forbes.com).
Aside from this phenomenon, online bookings now accounts for more than 40% of total travel sales. This has undoubtedly paved the way for online travel agencies to take off, making it more difficult for brand hotels to generate on-site bookings. Expedia and Priceline are at the forefront of bookings with revenues now reaching $35 billion. With the majority of the global population being online users, OTAs will look to untouched international markets like Italy, Spain, Germany and Mexico (MarketRealist.com).
These changes have been heavily influenced by the shift in customer behavior in the market. Customers are now researching and booking much differently than they were five years ago. They are expecting hotel sites to be easy to use, responsive and to interpret and predict their needs. The rise in millennial and business travelers plays a large role in the digital shift hoteliers will begin to see, so keeping their expectations at the forefront is critical.There are three common themes that have continued to be a large focus in the hotel marketing community over the past year. We believe that these will become critical aspects to digital marketing over the next year.
A hotel partner of ours has seen their direct bookings grow from 4% to 38% in the last 3 years. This was achieved by putting direct booking and digital marketing strategy at the heart of their business strategy rather than viewing it as an add-on to their strategy.
Direct booking is now the single largest online segment, with the largest single OTA delivering 30% or less of their online bookings monthly. A good balance between direct and OTA distribution has been achieved, and direct revenues are generating significantly increased margin.
Your multi-channel approach must include the full digital toolkit including your core, proven revenue-generating marketing initiatives, like SEM, SEO, email marketing, display, retargeting, and Dynamic Rate Marketing, as well as seasonal or business need-focused campaigns. A luxury hotel should choose a marketing message that speaks to its ideal audience, and broadcast it through all of these relevant channels.