Musings from HSMAI Conference
I attended my first HSMAI Revenue Management & Internet Marketing Strategy conference today in Orlando. There was a lot of good information shared but a couple of points have stuck in my mind.
First, the look-to-book ratio continues to grow. This indicator shows that people are visiting more and more sites before they ultimately complete their bookings. People are shopping for travel more than ever before, looking for the best price and checking online reviews to validate their decisions before buying. The fact that people are shopping around also means that PPC advertising is doing less for hotels than ever before. Due to the volume of content on OTA’s, they often come up higher in organic search than hotels and even brands, and OTA’s can spend much more on paid search because the cost is amortized over a far higher number of properties. As hotels and brands spend money to drive traffic to their sites, the purchase is often happening elsewhere.
So what’s the answer? Research has shown that people who read reviews are twice as likely to book than people who don’t. Hotels should be featuring reviews and other social content on their web sites. In addition to helping their SEO results, reviews have proven to be effective in conversion. Additionally, I think that at least part of the budget that would have been spent on PPC might be better spent on programs designed to drive positive reviews, and on ensuring that you are staffed so that you can deal with negative comments in a thoughtful manner and make the appropriate operational improvements to improve satisfaction. (And make sure that the budget you do spend on PPC is spent as wisely as possible, by employing tactics that can give you an advantage, such as utilizing your expertise by focusing on local markets.)
Second, there was a suggestion at one of the sessions that offering Twitter and Foursquare specials cannibalizes sales. “Why lower your price or give anything away when someone is already a fan or customer?” Aside from the fact that competition is fierce and loyalty is low, clearly the people who made these comments have never experienced the glee of going to the mailbox and seeing that Zappos has shipped your next-day-air, for free, even though you selected for 5-7 day shipping. They have never received a complimentary upgrade on an airline for smiling and being polite. They have never walked into their corner bar and gotten a drink on the house. How am I so sure? Because anyone that has experienced ‘surprise and delight’ knows how great it feels and how loyal you become to the brand that bestows the favor.
As you have read in some of my other posts, I am a huge advocate of using social media to strengthen relationships with existing customers and drive buzz. It’s the perfect vehicle for treating customers as individuals, not categories. Try it. You’ll see.