A few months ago we wrote an article stating that the hotel franchise model is dead. Looking at the innovation of the last year in online marketing and distribution we can take this statement a bit further. 2010 will be the year of the independent hotel and direct sales!
So why will be 2010 be the year of DIRECT SALES and the INDEPENDENT HOTEL?
First of all this is kind of a contradiction. The reason that 2010 will be the year of the independent hotel is partially to thank to the resurgence of the OTA and Travel Merchant model. The current economic challenges in the market have allowed 3rd party travel agency websites to regain a larger % of online travel distribution.
The OTA distribution channels have made the franchise chain complacent. They easily produce the same number of bookings and revenues or more that the franchise chains. Looking at the paid advertising section of search engines like Google and Yahoo, the strong presence of OTA’s reflects this.
Shopping around on any of the travel agency websites, we have started to notice that more and more hotels listed on the first are independent properties, or belong to local or smaller hotel groups. Something tells us that the global chains and larger hotel groups have been pushing quite persistently over the last few years to bring commission levels down over the last few years that the OTA’s prefer to list properties with which they yield a larger margin.
But also on meta-search sites like Trivago and even Bing Travel independent hotels are starting to floart to the top more and more. On some sites and destinations they even significantly outweigh the number of ‘big brand’ chain properties. Just check TripAdvisor for the top 20 hotels in London, Paris and San Francisco. The independents are starting to rule the charts….
And even when doing a search in Google for Hotel London, Hotels Amsterdam, hotels in New York, etc gives comparable results. Independent hotels seem to dominate the online real estate.
So why does it seem that independent hotels have gained the upper hand? It is quite simple actually. Even though chains and large hotel groups offer many advantages (reduced purchasing cost because of scale etc), they also lack the focus to market a particular property or destination. Too many layers of management and difference of interest and priority between internal departments and management steers the chain in another direction. Their online positioning usually is mainly focused on the brand or flag.
Many corporate rules and guidelines within chains and hotel groups prohibit or withhold individual properties to develop their own direct marketing strategy. After all the chain takes care of the marketing side of the business, right? The lack of decentralization and empowerment of the on property hotel management is a huge handicap for them.
The above is all about commissions and marketing investments and efforts. But in this new age of Web 2.0 (or Travel 2.0) there is another factor we have to take into consideration when it comes to marketing.
Yes our guests are making huge efforts to market our hotels to their friends and other travelers. They use websites like TripAdvisor, TravelPost, and IGoYouGo to spread our story. And this word is so important, ‘story’. For your guests to write about their experience at your hotel and post images and video online on hotel review websites, travel communities and social network you have to be remarkable. As Seth Godin simply puts it, remarkable means:
‘worth making a remark about’
The hotels who have the highest scores on review websites and get mentioned often on VirtualTourist.com and TravBuddy.com are the ones that are different. But different in what way?
- Authentic friendliness of the staff
- Amazing location
- Exceptional personal attention
- Impressive original food
- Exclusive service
- Simplicity, no frills
- Unique design
- Warmth and true hospitality
It doesn’t matter, as long as you give your guests a unique experience that they would want to share with their friends and the rest of the world. You need to offer them something special.
So when we are talking about independent hotels or small and local hotel groups, we are not talking about just any product. It needs to be good quality and value for money you offer (please note quality does not equal luxury).
But why do independent hotels get more traction online that similar quality product offered by the big chains? First of all consumers like to be treated as individuals and for their specific needs recognized. This is easier of course for a ‘boutique’ hotel than a design hotel belonging to a chain counting over 1000 properties. It’s simply another world.
This is by the way confirmed by the latest move of Marriot. They have just launched a brand called ‘…..’ which is to exist of flagship properties.
Secondly independent hotels or small groups tend to be more flexible and creative when it comes to marketing. This is born from a need being the ‘underdog’. And with some of the technology and solutions that have been rolled out by search engines like Google and Yahoo, review websites like TripAdvisor, travel communities like IGoYouGo, and Social Networks like FaceBook and micro blogging sites like Twitter there are more tools at hand for guerilla marketing and creative strategies.
This is why the independent hotel will excel in 2010. They will not be hold back by corporate rules and management approval layers. The independent hotelier can and will do whatever is necessary to fill his hotel.
Having read success stories online over the last year from fellow bloggers and from our own experience in designing hotel websites and implement hotel internet marketing strategies this is exactly what is happening. Independent hotels have been quite successful in driving direct sales to their own website and reservations center.
What interesting developments have we seen this year or what tips do we have for hotels? Here is our 2010 punch list;
- Opensource CMS: For more flexibility in managing the content of your website you should use an opensource content management tool. It will allow you to launch new pages and change structure without depending on your web designer. (Joomla / WordPress / Drupl)
- SEO: pick your keywords carefully, in your meta-titles and description focus on search behavior and not on product and brand. Sell what your potential guests are looking for!
- Landing Pages: Pick themes, launch a page for every special offer and market segment or search. Think niche marketing and search engine saturation! Cater to each potential market segment on an individual basis. The long tail of travel seo works!
- Languages: An easy way to expand your reach. What at the main tourist feeder markets for your destinations? Are you missing any languages?
- Google Places : A great way to improve your listing and traffic. Powerful marketing tool which is only just starting to show its potential. The implementation of Google Maps Favorite Places gives you an idea where we are heading. click here for more info
- Google Webmaster Tools: Register your site map. Ideally you should have an XML sitemap that pushes your menu structure out to the search robot. If you are lucky Google will pick-up your menu structure and show site links below your URL when people look for your hotel specifically.
Click to Call, Chat, Call Back: Be hospitable and available on your hotel website. Assist potential guests to increase the number of bookings. Remember phone conversion is higher than online as it is more personal. So let them call you! You can use a simple service like Skype or look at solution offered by companies like eStara
- Tourist Guide: Become a travel agent instead of a hotelier. Don’t push your product but sell the destination. Use maps, Google loves this!
- Events: What is going on in town while your guests are staying with you. Include it on your home page. Make an event section and show it in confirmation emails. No need to do it all by yourself, pull event calendars in through RSS feeds from your local tourist board website or sites like Eventful.com
- Video: Integrate videos into your website. Shoot your hotel room with your own camera and put the videos on YouTube and list them afterwards on your site. It helps you in 2 ways. We all know pictures say more than a 1000 words. Well videos kind of have a multiplied effect of this. Secondly it is a great SEO move. Make sure you pick your keywords smart in YouTube! Oh yes don’t forget to add the videos to you Google Local Business Center listing.
- Review Monitoring: Make sure you know what people write about you. You can set-up a control panel for free using RSS feeds from review websites, Google Alerts, Yahoo Pipes and Netvibes.
- Review Response: Thank everyone that write something about your hotel, positive or negative. They are your guests. Engage and show them you care and value their feedback. Keep in mind potential guests will notice that you are involved.
- Review Stimulation: Email guests after check-out, ask them to write about their experience on review websites like TripAdvisor or TravelPost and you hotels FaceBook profile. This way they help you to spread the word.
- Review Recycling: Filter out the positive stuff. You can use Delicious and create a feed you can send to FriendFeed, FaceBook and Twitter. Just like the movie companies on their posters, ‘New York Times says: Best Movie of the Year’. Good thing is, you did not write it! This works, we tried it!
- Blog: Integrate the hotel blog into your hotel website and become a tourism journalist. Write about interesting and original things. Cover events in your city or destination. Please don’t write about your hotel’ it’s usually boring. Except of course if you have something really original will spark interest. But it has to be really really special!
- Online PR: Those interesting articles you write for your blog can now be placed on tourism news websites with links to your hotel website. There are also many blog syndication pages. It is one of the most effective SEO strategies. Moreover if you started to get recognized of a provider of great content you will be branding your hotel in the strongest possible way.
- RSS: Use Feedburner to distribute your blog by email and RSS Syndication.
- Listing Websites: List your hotel on as many free listing websites that allow you to put in a link to your hotel website. Please do not participate in link exchange. Start with WikiTravel, Yelp, VirtualTourist.
- Web 2.0 BroadCasting Station: Link all of your profiles from social networks, photo and video sharing websites and book marking website to save time. This way you don’t have to post the same thing over and over again. FriendFeed is the mother of all 2.0 websites. It allows you to link up all the others… You should be on FaceBook, Twitter, Flickr, Delicious, Digg, …
- Mobile: Start with a simple mobile website so you can be found if people look for your hotel. Have picture and click to call button. Simplicity should do the trick for now.
- eCRM: Personalized confirmation emails, pr-arrival and after check-out emails work. But again they need to be personalized. Include weather forecast, events during the guest’s stay, restaurant suggestions etc. Step 1 though is making sure your reservations office and front desk is capturing email addresses! Make sure you build a proper DB and develop a plan for implementing a hotel CRM strategy.
And now the most important point we would like to make. Budget appropriately for online or internet marketing. Your hotel website should generate at least 40% of your sales. So why not allocate the same percentage of your total marketing budget to it. Reduce the spending on traditional sales and branding items like brochures, letterhead, etc. Hospitality starts online and so should your marketing.
You can increase direct sales easily by investing strategically and by using the latest innovations in your hotel website design and internet marketing.
2010 will be the year of Direct Sales and Independent Hotels!
For more information on our thoughts on how to drive direct sales click here: Hotel Internet Marketing.
Patrick - Xotels