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OTAs, Digital Marketing and Social Media, How are their impact into Hotels Business?
 

OTAs, Digital Marketing and Social Media, How are their impact into Hotels Business?

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    OTAs, Digital Marketing and Social Media, How are their impact into Hotels Business? OTAs, Digital Marketing and Social Media, How are their impact into Hotels Business? Presentation Transcript

    • WHAT IS THE REAL IMPACT OF ONLINE TRAVEL AGENCIES’s (OTA) IN HOTELS’ REVENUE? WHAT DOES MEAN SOCIAL MEDIA FOR HOTELS? WHY DOES A HOTEL NEED A RELATIONSHIP WITH OTAs?
      • OTA’s cost: they receive their commission at the point of sale,
      • Their cost are not included in the Marketing budget
      • OTA: Hotels’ Marketing channel, the way to sell hotels’ products.
      • In 2009 : Economic crisis. OTA’s low prices attracted customers for hotels.
      • In 2010 & 2011: Market recuperation, hospitality industry’s crisis recovery.
      • DO HOTELS NEED OTAs ?
    • Analyses of cost OTA’s in Hotels’ Business
      • Different regions
      • July year-to –date occupancies and average daily rates
      • Source: Smith Travel Research
      • Cost range from $22,450 at 10% contributions to $173,881 at 25% contribution level
      • Higher is the OTAs’ contribution, higher are their cost paid by hotels
      • OTAs retain customers’ profile. Therefore, hotels get business, but not customers .
      • Customers are the hotels’ real value: hoteliers want customers to become loyal to their chains
    • Comparison between Reservation costs: directly hotels’ web, GDS and OTA Reservations made through GDS result in 14% less revenue for the hotel than made directly in the hotels’ web and those made through OTAs’ result in 15% less revenue.
      • Invest in their direct website in order to reduce OTA’s cost and
      • increase their revenue.
      • Allocate their savings into Internet Marketing.
      • Make their web friendly user and provide a call to action to book.
      • Develop their Internet Marketing strategies: optimization, pay-per-click, email marketing, social media (Facebook, You Tube,
      • Twitter, Flickr).
      • Improve their customers service in their websites .
      Hoteliers should :
      • Although the booking cost made through Direct Online Channel (Hotel Brand Website) is10-15
      • cheaper than those made via GDS and OTAs, from 2008 OTAs have increased their booking
      • contribution by 45%.
      • Hotels distribution has changed dramatically over the past 16% since the advent of
      • the “commercial” Internet.
      • Independent hotels and resorts have not change their channel distribution very much: some
      • still work with OTA which destroys rate parity and causes price erosion.
      • Those hotels needs to focus on distribution channels which generate the most bookings,
      • protect rate parity and price integrity and reach the targeted customers segments.
      • Those hotels are overwhelmed by this rapid shift from offline to online distribution.
      • They often fail to compete for their fair share of the market.
      • The main reason is the lack of understanding that Internet marketing is not an expense,
      • but an investment in direct Online Channel will provide immediate returns at very high ROIs.
      • /
      Can Hoteliers reverse the OTAs trend and take back control of online distribution channel?
      • Sometimes Hotel brands conclude partnership with OTAs
      • Expedia, Inc. the world's largest online travel company, announced
      • a new multi-year, global partnership agreement with Kempinski Hotels.
      • Reason could be :
      • - hotel brand is not enough big to compete with top hotel brands
      • http://www.prnewswire.com/news-releases/expedia-and-kempinski-hotels-sign-global-partnership-agreement-124413293.html
      • Marriott recently signed an online distribution cooperation agreement
      • with Ctrip.com, China's largest online travel agency
      • Reason could be :
      • - Hotel brand have not reached the target market
      • http://hma.hotelworldasia.com/content/marriott-signs-agreement-chinese-travel-agency
      • Hilton joins Marriott International and InterContinental Hotels Group in making its lowest available rates and complete hotel pricing available through Worldspan, Galileo, and Apollo
      • Reason could be:
      • They want to control the price, impose their rules to OtAs and GDS as those indirect online systems have a share contribution in those hotels brands.
      • http://hotelmarketing.com/index.php/content/article/travelport_users_get_closer_to_hilton_through_advanced_gds_interface
    • Social Media & Hotels
      • The tendency of consumption in Social Media such as Facebook is increasing constantly.
      • Hotels want to be connected to Social Medias which are the biggest trend communication channel.
      • Many hotels brand have recently developed their social media marketing..
      • Hotels are dependent on satisfied guest and customers. Social Media provide a constructive dialogue with their customers.
      • Social Media makes hotels to be in touch with their customers.
      • Social Media represents a smart way to increase hotels’ revenue.
      • Big chains like: Marriott International , The Four Seasons Hotels & Resorts,
      • The Ritz-Carlton, Haytt Hotels, Fairmont Hotels Millennium Hotels have their social media very well developed (Facebook, Twitter, You Tube, Flickr and mobile channel)
      • Customers ask their friends on social network about their opinion of a hotel.
      • Social media is a way to make the guests’ hotels loyal customers. Therefore, more they use hotels’ products, more things they can get for free (like the milles’ program).
    • Facebook & Hotels
      • Facebook has around 800 million users.
      • 70% users are involved with Facebook applications.
      • More than 20 million applications are installed every day.
      • Facebook has a special social media platform : SocialBooker which is easily customized to integrate the hotel central reservation system.
      • SocialBooker is important to increase sales, create the customers profile and their loyalty, decrease distribution costs, provide a better customer service.
      • SocialBooker personalize and make the reservation easier by encouraging the travelers’ social interactions.
      • Hotels are more focused on applications that involve the integrating with Fecabook’s hotels application as it is a way to increase their revenue.
    • Sources:
      • http://www.hotelinteractive.com/article.aspx?articleid=18354
      • http://hotelmarketing.com/index.php/content/article/why_ota_customers_are_not_your_customers
      • http://hotelmarketing.com/index.php/content/article/combating_losses_to_otas_with_a_strong_hotel_seo_strategy
      • http://hotelmarketing.com/index.php/content/article/why_ota_customers_are_not_your_customers
      • http://hotelmarketing.com/index.php/content/article/combating_losses_to_otas_with_a_strong_hotel_seo_strategy