Do you know the individual profitability of the channels you use to acquire and convert your guests? Are you able to calculate the impact of shifting traffic from one channel to another? Are you making distribution decisions based on fact, or received wisdom? With the industry going through a transitional period as Google grows in prominence and metasearch becomes a defining factor in attracting direct traffic, it’s more important than ever to take another look at your hotel’s distribution strategies.
In the first Hotel Heroes webinar, Triptease’s Chief Tease, Charlie Osmond, was joined by three of the program’s founding members, who each shared their experiences of running some of the world’s most successful hotel brands. Our expert panel guests included:
Inderpreet Banga, VP of Channel & Distribution Strategy at Wyndham Hotels and Resorts
Joe Pettigrew, Director of Revenue Maximization, Europe Hotels at Starwood Capital Group
Justyn Hornor, Senior Product Manager at Las Vegas Sands
Over the course of the webinar, each of the Hotel Heroes made their own case for a new approach to distribution, as well as giving practical advice for successfully planning, operating and implementing their philosophies. You can watch the full recording of the webinar below, or keep reading for a wrap-up of the key points that Inderpreet, Joe and Justyn shared with us. While our Heroes fielded questions during the webinar, they’re still happy to help with any problems, challenges or concerns that your hotel has been facing on our ‘Ask the Heroes’ section.
“The brand that guests are most interested in is the one Google tells them about first.”
Justyn kicked off the discussion with his latest attempts to take a ‘Google-first’ approach to the user experience on his hotel’s website and booking engine, with the aim of creating a frictionless experience for prospective guests arriving from the search engine giant. Justyn revealed how “guests from this channel are the most lucrative for us in terms of conversion rate optimisation, ROI and ROAS”, and so his new booking engine has taken design inspiration from Google, alongside ensuring the likes of the calendar functionality mirror what the guests may already be familiar with.
Alongside his new design ethos, Justyn outlined how he has been taking advantage of the direct channel as not only a place for conversion, but also as fertile ground for testing optimization hypotheses on different segments of his audience. By taking advantage of A/B testing (watch his previous webinar for more on making the most of evidence-based design), Justyn found that removing the need for a billing address on his booking engine’s credit card form had a huge impact on mobile conversion rates, with an uplift of 20% over the course of his trials. Justyn sees the agility of the direct channel as a particular strength when it comes to testing as, in his own words, “good luck doing that on Expedia and telling them what to do on their forms!”. While he does acknowledge that this may not be applicable for all hotels, Justyn emphasises how “for [his] brand, direct is a great tool to drive certain segments” into his focused tests.
“Study how your customers are behaving on all of your channels”
While Joe agreed that the direct channel can be a major asset for hotels, he underlined the fact that the hotel’s overall performance must be a priority before focusing on a specific channel. Joe explained how, especially for hotels that may not be able to access detailed data from their own PMS or booking engine, OTAs could actually be the best place to discover how certain demographics interact with listings. For example, if you notice an increase of family bookings on an OTA, this may be because they reveal more detail than your own booking engine on something as granular as your children’s breakfast policy.
Joe highlights that “you should be looking at making more from OTA strengths, as well as trying to fix your own weaknesses.” This can be achieved by taking a deeper dive into the data available to you, and - crucially - always analysing it in multiple dimensions. Look at the volumes you are driving on each channel, but don’t stop there - how do they vary in terms of the room types they sell or their ADR? Download your PMS data and understand what bookings are coming from your specific distribution channels, and use this to determine why your online marketing is most effective. If you have a channel that is outperforming for a specific segment, “keep on making sure you’re getting that demand from the OTA, and then work out how to drive that from your direct channel”.
“Everywhere is becoming a marketplace”
Last up to the plate, Inderpreet brought his wealth of experience to bear on his argument that profitability must be the primary metric for assessing the success of a hotel’s online marketing. The information that a STAR report shares is not enough - Inderpreet emphasises how hoteliers must dive deeper into each channel and segment and see what’s really driving activity, as booking journeys and the forces impacting them can be incredibly complex.
Inderpreet also described the need to “test whether certain channels make sense for your business based on cost”. For example, the 60% off a static rate that may be given to wholesalers could be redirected through other channels, or even minimized by booking window or room types. Rerouting certain revenues, even through OTAs with better rates, would lead to a dramatic improvement in profitability, potentially “allowing you to optimize or drive revenue direct”. Beyond all this, though, lies the importance of ensuring parity: “you need to be cautious about any low rate that comes in”, and utilizing insights from a holistic view of your parity data can greatly assist in determining channel shift.
Do you have a burning question you’d like to suggest to our Hotel Heroes that they didn’t have time to discuss during the webinar? From distribution to conversion rate optimization and everything in between, suggest a topic on our Ask a Heroes page and receive a direct response from one of our industry leaders.