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Digital Marketing Directions 2020

Tim Peter
Tim Peter

Curious about the future of hospitality marketing and distribution? This presentation to HSMAI's Washington, DC chapter explains why the future of hospitality marketing for independent hotels and brands alike starts this year.

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DIGITAL MARKETING
DIRECTIONS: 2020
Why the Future of Hospitality Marketing
and Distribution Starts This Year
What are the top trends in
hospitality marketing?
Digital Marketing Directions 2020
Artificial
Intelligence
Conversational UI
Quantum
computing
5G
Self-driving cars
Metasearch
Privacy
Millennials
Mobile
Blockchain
Artificial
Intelligence
Conversational UI
Quantum
computing
5G
Self-driving cars
Metasearch
Privacy
Millennials
Mobile
Blockchain
+
Digital Marketing Directions 2020

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Digital Marketing Directions 2020

  • 1. DIGITAL MARKETING DIRECTIONS: 2020 Why the Future of Hospitality Marketing and Distribution Starts This Year
  • 2. What are the top trends in hospitality marketing?
  • 7. More people own mobile phones than own toothbrushes 7
  • 8. Trend #0: We need to stop talking about mobile as a trend… It’s a way of life 8
  • 9. More page views on mobile than desktop… starting in 2016 Greater than 65% of all digital media time… and growing Over half of all searches on mobile Over 20% of mobile searches on voice 5G started testing in 2017 – 1,000x faster than 4G © 2018 Tim Peter & Associates - Proprietary and Confidential 9
  • 10. Mobile changes behaviors © 2018 Tim Peter & Associates - Proprietary and Confidential 10
  • 11. Mobile changes business models © 2018 Tim Peter & Associates - Proprietary and Confidential 11
  • 13. They’re Not “Millennials” They’re “Adults Under 40” • Largest single demographic category (~73m vs. 72m Boomers vs. 66m Gen X)… and growing • Largest share of business travelers • More travel days than any other demographic (35 travel days/year vs. 27 for Boomers and 26 for Gen X)
  • 14. And now the bad news… • Adults under 40 spend significantly less per year on travel than any other age group (~$4,400 vs. $6,600 for Boomers and $5,400 for Gen X) • The Great Recession is the gift that keeps on taking from this segment
  • 16. Metasearch is a feature, not a product or company
  • 17. Significant changes coming in search may further pressure ranking/performance Duetto calls Google, “Your most important hotel distribution channel”
  • 18. “Google is our biggest competitor. The internet has been littered with the bodies of companies put out of business by Google.” Mark Okerstrom, Expedia CEO
  • 19. What are you going to do?
  • 20. Smart hospitality organizations ignore“mobile-first” – focus on “guest-first” instead
  • 21. Response #1: Content is, was, and always shall be King © 2018 Tim Peter & Associates - Proprietary and Confidential 21
  • 22. Even voice – which is growing significantly – relies on content to work Worry about the website and what powers that customer experience Focus on “the painting,” not just “the frame” © 2018 Tim Peter & Associates - Proprietary and Confidential 22
  • 23. 23Source: “Demystifying the Digital Marketplace,” p. 45, Kalibri Labs/AHLA, 2016
  • 24. Content attracts and converts guests • Customers who start on OTA’s have only a 7% chance of booking on hotel website1 • Customers who start on brand website have almost 10x percentage of booking through brand direct site • “According to Expedia doubling a hotel’s online pictures can result in a 4.5% take-up and $3.50 higher ADR, while providing a full property description (as opposed to a partial one) can result in a 5% take-up and $3 higher ADR”1 • Key takeaway: We are all publishers now 1: “Demystifying the Digital Marketplace,” p. 40, Kalibri Labs/AHLA, 2016
  • 25. 4.5 billion hours of video watched
  • 29. SNACKABLE SHARP SHAREABLE © 2018 Tim Peter & Associates - Proprietary and Confidential 29
  • 31. 55 100 4,500 5,500 10,000 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 Instagram posts Facebook hours of video watched YouTube videos viewed Google searches Snapchat video views Response #1½: Content increasingly means video © 2018 Tim Peter & Associates - Proprietary and Confidential 31
  • 32. Video beginning to influence guests • Views of branded video on YouTube up 118% YOY • 2 out of 3 US consumers watch online travel video when they’re thinking about taking a trip © 2018 Tim Peter & Associates - Proprietary and Confidential
  • 33. Four types of content needed to merchandise and market your properties Destination content. The first rule of selling travel to consumers remains “sell the destination first.” Research from Google shows that travelers tend to start their travel planning by searching destination-related terms. Whether you use blog posts highlighting area attractions, dedicated destination guides offered on your website, email marketing campaigns featuring local hot spots, or themed-content targeting key audiences, guests must first want to travel to your destination; you cannot get guests to consider your hotel if they’re planning to travel to another destination altogether. Property content. Often referred to as “descriptive” content, or less commonly “static” content, this includes information about your property itself, such as the number and type of guest rooms and meeting rooms, available amenities, its physical location and proximity to attractions, property name, brand affiliation, and other necessary attributes. Promotional. Promotional content includes the many offers, specials, and packages your marketing team designs to attract customers to book, enroll in loyalty programs or email lists, or any other call-to-action you can imagine. Availability, rates and inventory (ARI). Finally, availability, rates, and inventory presents guests with information about what they’ll actually book — descriptions and details of the room types, rate plans, and packages your property offers — as well as the dates when guests can book their stay. While ARI typically refers only to room types and suites, additional amenities, add-ons, and upsell items — including such varied items as restaurant reservations, Collab reservations and the like — may also represent inventoried items within your property management system, central reservations system, or booking engine. Google, “The 2014 Traveler’s Road to Decision,” Google, retrieved November 22, 2017, http://storage.googleapis.com/think/docs/2014-travelers-road-to-decision_research_studies.pdf. Also, Caroline McGuire, “Google reveals the top 10 travel searches of 2016 in the US,” The Daily Mail, retrieved November 22, 2017, http://www.dailymail.co.uk/travel/travel_news/article-4047968/Was-listening-geography-class-Google-reveals-10-travel-searches-2016-Grand- Canyon-them.html
  • 34. 34 ● Zoos ● Universities and colleges ● Theaters ● Business (esp. major employers, key accounts) ● Convention center
  • 36. Trend #2: Customer experience is Queen © 2018 Tim Peter & Associates - Proprietary and Confidential 36
  • 37. Just because you say something, that doesn’t make it true
  • 38. Price matters, but value matters more © 2018 Tim Peter & Associates - Proprietary and Confidential 38
  • 39. 39 “...humans rarely choose things in absolute terms. We don’t have an internal value meter that tells us how much things are worth. Rather, we focus on the relative advantage of one thing over another, and estimate value accordingly.” –Dan Ariely
  • 40. Real-world experience illustrates this in practice Achieved top positions in TripAdvisor, Yelp, social channels for multiple hotel clients Occupancy index improved to 95- 105 ADR index improved to 107-180 RevPAR index improved to 109- 169 Growth above comp set Reduced or held OTA share below 10%
  • 41. Adults under 40 represent major upsell opportunity • Upsell: Masters of “bleisure” travel (81% “probably” will add extra time to trip vs. 56% for Gen X and 46% for Boomers) • Speed: 49% put off booking if they can’t do it instantly online… which means mobile • Value: 50% consider themselves “Travel Hackers” able to get deals (vs. 26% for Gen X and 12% of Boomers)
  • 42. Matures continue to represent significant revenue opportunity • Value: Mostly “price” sensitive, but can swayed by experience • Experience: Don’t tend to mix business with pleasure – sell benefits of specific trip • Longer-term? Be conscious of growth trends as Boomers begin to age out of the marketplace
  • 43. 93% of consumers say online reviews impact their purchase decision 1% lift in TripAdvisor Rating leads to ~1% increase in RevPAR Companies with higher NPS grow 200% faster than competitors
  • 44. Review quality leads to increased RevPAR Pricing Power (ADR) Demand (Occupancy) Performance (RevPAR) All +0.8% +0.2% +0.96% Upscale +0.67% +0.19% +0.83% Upper Midscale +0.74% +0.42% +1.13% Midscale +0.89% +0.54% +1.42% Measured change in pricing power, demand, and performance given a 1% change in online reputation Source: Cornell Center for Hospitality Research
  • 45. In other words, your brand is only as good as your last review “…64% of leisure travelers and 52% of business travelers said they are not loyal to a particular brand. Sixty-nine percent of travelers tell family and friends about travel products and services, and 46% rely on those recommendations.”1 In essence, your brand is only as good as your last review 45 1: http://www.travelweekly.com/Travel-News/Hotel-News/Study-says-personalized-service-key-to-hotel-customer-loyalty
  • 46. “Speed is the new currency of business” - Marc Benioff Chairman and CEO, Salesforce.com © 2018 Tim Peter & Associates - Proprietary and Confidential 46
  • 47. Your mantra: “Instant gratification isn’t fast enough” © 2018 Tim Peter & Associates - Proprietary and Confidential 47
  • 49. Leverage guests to create and curate a positive brand story • Guests during peak periods create opportunity to reach over 6.5 million potential guests • Punch through Facebook filters with content from “friends and family” • Test Flip.to platform or equivalent 49 Total rooms 150 Occupancy 60% Days occupied 365 Average friends on Facebook 200 Potential addressable audience 6,570,000
  • 50. Leverage guests to create and curate a positive brand story • Guests during peak periods create opportunity to reach over 6.5 million potential guests • Punch through Facebook filters with content from “friends and family” • Test Flip.to platform or equivalent 50 Total rooms 150 Occupancy 60% Days occupied 365 Average friends on Facebook 200 Potential addressable audience 6,570,000 You want influencer marketing? You have a house full of them
  • 51. Trend #3: Data is the Crown Jewels © 2018 Tim Peter & Associates - Proprietary and Confidential 51
  • 53. OTA’s moving into hotel services: Expedia Powered Technology Expedia launched Expedia Powered Technology including MICE booking solution – “he first tool that truly automates the booking process for meeting organizers and hotels in real time” – “free” Rev+ revenue management tool and more Expedia hired VP, owner strategy and services (October 2016) “...focused on growing relationships with, and developing new services for, hotel owners and management companies”1 Starting to address the “in-stay” experience with keyless entry trials taking place with a partner in Norway Investment in Alice On-Property guest experience management tool 1: https://www.traveldailynews.com/post/mark-morrison-joins-expedia-inc-as-vice-president-of-owner-strategy-and-services#sthash.MEi0HPx0.dpuf
  • 54. “We are working to ensure we can not only provide distribution and new audiences for our partners, but also help solve for other challenges they may have. As we make the shift to strategically focus on needs of evolving business solutions, we are committed to using our resources and technology to create new product offerings that help our partners reach their goals.” - Cyril Ranque, president, Expedia’s Lodging Partner Services 1: https://www.traveldailynews.com/post/mark-morrison-joins-expedia-inc-as-vice-president-of-owner-strategy-and-services#sthash.MEi0HPx0.dpuf
  • 55. “You can never have too much data. Bigger is definitely better.” Werner Vogel, CTO, Amazon
  • 57. Welcome to the post- GDPR and CCPA world of marketing
  • 58. Visual Information Specialist Jason Johnston/U.S. Army Practice does not make perfect
  • 60. THANK YOU © 2018 Tim Peter & Associates - Proprietary and Confidential 60 Web timpeter.com Phone +1.201.305.0055 Email tim@timpeter.com Twitter @tcpeter
  • 62. Develop paid media budget as percentage of sale 62 Metrics ● Cost-per-click (CPC) or cost-per- impression (CPM) ● Clicks (or impressions) ● Total cost (CPC * clicks) Metrics ● Visits ● Conversion rate Metrics ● Conversion rate (conversion actions/visits to page) Metrics ● ROI or ROAS ● Cost per conversion (Total cost/conversion rate) Metrics ● Cost per conversion as share of sales revenue
  • 63. Which is better? 63 Scenario A Scenario B Cost-per-click $1.00 $2.00 Conversion rate 4% 8%
  • 64. Scenario A Scenario B Cost-per-click $1.00 $2.00 Conversion rate 4% 8% Cost-per-conversion $25 $25 Which is better? 64 They’re exactly the same Focus on cost-per-conversion, not just cost-per click
  • 65. Channel is irrelevant –same model applies to all 65 Scenario A Cost of labor $25/hour Hours to produce content 40 Total cost of content $1,000 Clicks received 500 Cost-per-click $2.00 Conversion rate 5% Cost-per-conversion $25