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Demystifying hotel metasearch

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The world of hotel searching and shopping is evolving… …

The world of hotel searching and shopping is evolving…

This FREE webinar by Tnooz and Travelport will demystify how metasearch relates to the hotel industry and clarify the opportunities and challenges in this ever-evolving and cutting-edge business model.

Webinar presenters are:

Max Rayner – partner, Hudson Crossing
Doug Aley - VP of product and corporate development, Room 77
Tracie Carillo – global head of hospitality sales, Travelport
Kevin May - editor and moderator, Tnooz
Gene Quinn – CEO and producer, Tnooz

Published in: Travel, Technology, Business

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  • Mobile = smartphones + tablets
  • Sea of sameness – self included
  • Stand outs innovated on the model and the overall CX. Speed, comprehensiveness/best price, all undifferentiated table stakes.
  • Transcript

    • 1. Demystifying Hotel Metasearch K Webinar October 31, 2013
    • 2. Your hosts K Kevin May Editor & Moderator Gene Quinn CEO & Producer
    • 3. Your panelists K Tracie Carillo Global Head, Hospitality Sales Travelport Max Rayner Partner Hudson Crossing Doug Aley VP, Product and Corp. Development Room77
    • 4. Poll no. 1 K
    • 5. Poll no. 2 K
    • 6. Demystifying Hotel Metasearch Max Rayner Tnooz - Travelport Webinar October 31, 2013 6 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 7. Contents: Demystifying Hotel Metasearch  How do you make a buck in this town anyway? A little about meta  Hotel metasearch answers a vital need, but not so well  What stands in the way, and how to get around it  Next up 7 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 8. How do you make a buck in this town anyway? A little about meta 8 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 9. What is hotel metasearch?  Push & Pull APIs  Search & Book  Extranets  Inventory  Descriptions  Rich media Meta search  Coverage  Conversion rate  Acquisition cost 9 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC  UX  Algorithms  Analytics  CPA  CPC  CPM  Traffic  App installs  Brand awareness
    • 10. What is hotel metasearch? Key activities go both left-to-right, i.e. supplier to consumer… Contract Hotels Get Content Get Availability Caches & Algorithms … and right-to-left, i.e. consumer to supplier: Referral 10 Aggregation & Display Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC Search Inputs Web & App Traffic
    • 11. Who plays the hotel metasearch game? With apologies to all those left out – such as Alexa ranks below 100K 11 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 12. How do they make money? Metasearch products have a few sources of revenue (actual numbers fudged to protect the guilty):  Commissions from contracted hotels  Annoying compare-a-site tick boxes CPC ~ 35¢ to 15¢ pre-checked  CPC items within results pages CPC ~ 95¢  CPM if any CPM ~ $9  GDS Financial Assistance (FA) and/or API provider Rev Share 12 CPA ~ 15% of booking value Let’s ignore those for now Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 13. So what does the metasearch funnel look like? Gross oversimplification to make a point (actual numbers fudged to protect the guilty):  Ignoring multi-channel effects  Lumping loyalty/return visits and media costs into effective costs for traffic 1,000,000 visits cost $1M (with an allowance for loyalty and SEO/organic returns) 1,400,000 searches (2 searches per visit, 30% abandonment) Checks and pre-  You paid $1M, you got back $1M checks net $50K  Now you have to cover tech and SG&A costs? Internal  Maybe it’s better than it looks… pages CP-X net $50K 20K bookings $900K 13 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 14. We thought you said it was a good business? You have different levers, and if you optimize each it can get much better:  Acquiring loyal users whose return visits don’t cost you much  Suppose you pay $2 per user acquired (whether for an email or app download)  But you can expect an annual value of revenue per loyal user of $7-$10. So as you grow return traffic costs you less and makes you more than the 90¢ per general visit  Top destinations can be quite expensive but you can optimize niche/long tail  $2-$3 CPC for top locations, but with higher ADR & LOS than average  You could manage down to $1.50 CPC, with a maximum 33% on returns… ~$1/visit  Conversion rates and brand awareness can fix most ills   14 Range all over from 1% to 4%. Conversion & loyalty can make or break your day! If you got the money, you can carpet bomb on TV until you’re a household name Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 15. Hotel metasearch answers a vital need, but not so well 15 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 16. Why we’re not there yet Despite massive computational power, metasearch is dumber than a thermostat 16 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 17. What could be better? Many traditional metasearch solutions look no different than OTAs  Just one enormous matrix of names, costs and reviews by random people Some of course offer a little more: Room 77 17 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC Hipmunk
    • 18. What could be better? The taboo about meta not taking payment details needs to go  Many metas have wisely concluded that distributor mobile Web sites are often so sketchy that they’d rather conclude the payment on their side…  And moreover that helps with overall loyalty and UX, though of course a higher customer service expectation goes with the territory 18 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 19. What could be better? Sell me customer delight, not in-and-out click churn  For once it would be great to see a recommendation that feels just right for me rather than leave me grouchy  Open the doors to an experience, not a bed with way too many dusty pillows  Address mobile and tablet first… if those are good, so will be your traditional Web  Hide all the annoyances from me: latency, bad hotel site UX, excessive choices, waste of time in general 19 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 20. What stands in the way, and how to get around it 20 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 21. Content (descriptive and rich), and Availability are a blocking factor The pipes to deliver content and to get push or pull availability and rates have been historically underwhelming…  … but some bright lights such as Travelport’s Universal API (UAPI) are opening new realms by merging GDS and non-GDS content and making it accessible at scale Universal Record (Super PNR)  So are new entrants in rich content delivery such as IcePortal.com 21 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC GDS and non-GDS Universal Profile UAPI
    • 22. Source systems are sketchy, too Few of the mission critical systems for hotels were created anticipating Web scale anything…  … but we are getting much better at engineering around their limitations and creating caching layers elsewhere  … and getting better at integrating third-party signals critical to personalization from systems such as Acxiom’s Audience Operating System (AOS) CMS Rev. Mgt. CRS PMS Wholesale Distrib. Campaigns Channel Mgt. 22 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 23. How to make it better? If it’s better for users it will be great for your business. Four areas: Reduce Enhance What current pain points/costs could be reduced well below industry standards? What elements of customer value could be enhanced well above industry standards?  Semantics gaps: “Left bank Paris boutique hotels” shouldn’t be just text index entries  Personalization: I’m not always the same me, and sometimes I don’t even know who I am Eliminate Create What are current pain points/costs taken for granted by the industry that could be eliminated? What elements of customer value could be created that are not available now?  Mobile UX and payments: Not so hard to do right, and so painful when wrong…  Machine 2 Machine & Person 2 Person: Add human curation and direct engagement to machine based search "Value Innovation – The Strategic Logic of High Growth". Harvard Business Review 75, January–February 103–112 23 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 24. What does success look like? 24 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 25. Success might look like this… Massive aggregation with dynamic personalization: Watson won Jeopardy, why can’t you?  “Cheers” meets Web scale data  Know who I am (now, and also later, and when I may be a different “me”)  Supplement machine-to-machine exchanges with UGC, including dynamic human-to-human exchanges  3Cs: Coverage, customization, curation 25 Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC
    • 26. Thank You! Looking forward to Q&A Hudson Crossing 112 West 34th St. New York, NY, 10120 United States of America Confidential ̶ All Rights Reserved | Copyright 2013 - Hudson Crossing LLC info@hudsoncrossing.com talent@hudsoncrossing.com
    • 27. Poll no. 3 K
    • 28. Who will win in mobile? Doug Aley, Room77 VP Product & Corporate Development
    • 29. 51% 50% 2013 time spent on internet is mobile 2014 US population with smartphone 70% Of 2013 new connected devices sold
    • 30. The question is no longer “is mobile important?” But “who will win?”
    • 31. JERRY SEINFELD You know the message you're sending out to the world with these sweat pants? You're telling the world: "I give up. I can't compete in normal society. I'm miserable, so I might as well be comfortable."
    • 32. So who will win?
    • 33. Poll no. 4 K
    • 34. Q&A K
    • 35. Thank you! Replay and presentation from today’s webinar will be available at www.tnooz.com K Please send your questions to kevin@tnooz.com