HeBS digital Blog

The following article is Max Starkov’s latest contribution to the “Successful eMarketing” blog on HOTELS magazine’s website.

 

Background

On January 11, 2012 six of the top hotel brands in the world launched RoomKey.com, a “hotel search engine website that facilitates booking on better terms than most online travel agencies.” RoomKey.com offers “meta search” for 23,000 properties spread among the six brands. The founding hotel chains include: Choice Hotels, Hilton, Hyatt, IHG, Marriott and Wyndham, which are equal shareholders in the new venture. Later in the week Best Western announced that their 4,000 properties will be joining RoomKey.com. More hotel chains are expected to join in the future.

The “direct connect” technology platform, similar to Jack Rabbit Systems, was acquired from Hotelicopter.com in an asset deal that closed last year.

“The intent all along was to drive down the cost of distribution and provide consumers with a better experience,” said John Davis III, RoomKey.com CEO. “Allowing them to book directly and become a direct guest of the hotel is a game-changer.”

 

RoomKey.com is Not the Only New Kid on the Block

In late 2011, several other organizations and entities announced the launch of hotel meta-search and direct booking sites meant to circumvent the OTAs:

www.mybesthotelrate.com – Launched by the Asian American Hotel Owners Association (AAHOA), an organization which has over 10,000 members owning 20,000 hotels. The CRS is powered by Citibreak, a reservation technology vendor focused on destinations. The site’s proclaimed objective is to help lessen its member hotels’ dependency on the OTAs. The site will charge participating hotels an undisclosed commission for every booking.

www.globalhotelexchange.com – Launched by Magnuson Hotels, “the world’s largest independent hotel group” with 2000 member hotels. The site will charge a small pass-through fee to the consumer, in the range of $3, to “underwrite the marketing and technology necessary to market and sell rooms without charging hotels a fee. There’s no commission fee charged to the hotel.”

 

What Would It Take For the New “Anti-OTA” Sites to Become Viable Industry Players

Last year over 30% of Internet bookings for the top hotel brands came from OTAs. Overall, 40% of all hotel bookings in North America came from the OTAs. STR estimated that the industry has lost over $2.5 billion in OTA commissions last year alone.

I have been the most outspoken direct online channel advocate for 16 plus years now.  I can only applaud these and any new “direct connect” initiatives by the major hotel brands and other hotel organizations to circumvent the OTA channel and lessen their franchisees’ and members’ dependence on the OTAs. I am rooting wholeheartedly for their success. And yet, I have serious questions and concerns about the viability of these new “anti-OTA” players.

What would it take for the new “anti-OTA” players like RoomKey.com to become viable industry players? In my view there are three main challenges new travel consumer sites like RoomKey.com have to overcome in order to secure sustainability and become real players in the industry:

 

1.    Establishing a Unique Value Proposition in the Marketplace

Let’s talk about the unique value proposition provided by these new anti-OTA players like RoomKey.com. I can clearly see what the value is from hotelier’s perspective: direct connect to the member hotels’ own booking engines at a comparatively “palatable” success fee (commission).

For these anti-OTA players to survive, they have to offer a powerful value proposition from a travel consumer perspective. Obviously, due to contractual obligations with the OTAs for rate parity and the best rate guarantees on the major brand websites, the value proposition cannot come in the form of lower or unique rates.

So what it is the value proposition that RoomKey.com or MyBestHotelRate.com can offer to the traveling public that is above and beyond a typical OTA site?

• Last Room Availability: HotelChatter reported earlier this week that while RoomKey.com and Expedia offered the same rates (rate parity), RoomKey.com showed availability for some hotels which were not available on Expedia. With rising travel demand, this could turn into a serious advantage as long as it is not in breach of existing contracts with the OTAs.

• Earning Reward Points: Currently merchant reservations via the OTAs do not qualify travel bookers to earn points from the major hotel brands. Since booking through RoomKey.com is booking via the major hotel chain’s CRS, travel consumers will be earning reward points, which is another serious advantage.

• Usability: RoomKey.com counts on its easy-to-use search functionality and a clean & elegant look. In addition, the site plans to have independent customer reviews, and the ability to compare, plan and share with friends and family. Would that be sufficient? Travel planning is a very complex process. Hotel bookers need more than hotel location, availability and rate, and peer reviews. Hotels are an integral part of the destination experience hence any hotel booking site needs to offer rich destination information, local activities, events, mapping, etc. In other words it is questionable whether the “clean and elegant” look of these new players will win travelers over the information-rich OTA sites.

• Social Media and WOM: Any new travel consumer site needs to appeal to today’s hyper-interactive travel consumers. Is RoomKey.com or MyBestHotelRate.com ready for these new breed of travel consumers? Only time will tell.

• Lots of Luck: Any new industry player in the current economic environment needs a ton of “economic luck” in the form of good timing, a business model that is in tune with the times, quick adoption by consumers, ability to take advantage of social media and word-of-mouth (WOM), etc.

 

 2.    Securing Serious Ongoing Revenues Needed to Establish a New Travel Consumer Brand

It is prohibitively expensive to establish a new travel consumer brand. The last two major travel brands to be successfully established were Orbitz (2003) and Kayak.com (2004). In addition to the initial investments for technology, website design and architecture, hosting and analytics, there is a serious need for ongoing operational and promotional expenses.

I doubt any RoomKey.com founding member is going to promote RoomKey.com on their own since this site features 5 of their biggest competitors.  No AAHOA member hotel will promote MyBestHotelRate.com wholeheartedly, since this site features concrete competitors to the member’s own properties.

RoomKey.com and the other “anti-OTA” players need to promote themselves – in other words, they need to generate revenue in the form of commissions or “success fees” in order to pay for the sites’ operational expenses, advertising, etc.

How much of a commission would suffice? RoomKey.com earns a commission from the booking, which as described by the company “is at a more supplier-friendly rate than what third party OTAs are offering, as it redirects users to the hotel company’s website for a direct booking.” Magnuson’s Global Hotel Exchange will be offered “at no cost to hotels struggling with economic instability” and will charge travel consumers a small “pass-through fee in the range of $3.”

In my view, any commission below 10%-15% would generate too small of a revenue stream for a site that is making baby steps and is trying to divert bookings from well-entrenched OTAs.

 

3.    Overcoming the Reaction and Legal Challenges by the OTAs

If history is any indicator (remember Orbitz?) as to how the OTAs would react to the launch of RoomKey.com and similar industry sites, I believe the OTAs will ask the Justice Dept to look into these new services because they  “smell of collusion” by and among major industry players.

 

A Word About MyBestHotelRate.com Initiative by AAHOA

I am fully aware of what AAHOA stands for as an organization and respect AAHOA’s objective to help lessen its member hotels’ dependency on the OTAs.  In my humble opinion, creating a new AAHOA consumer brand website does not solve the main underlying issue: lack of understanding among AAHOA member hoteliers about how to take full advantage of the direct online channel, what are the best practices, and ROI-centric initiatives. How to make sense of this very convoluted online travel marketplace?  Is Google Hotel Finder good or bad for me? Are flash sales sites like Groupon and Living Social good or bad for my hotel? Why is it detrimental for my hotel to use open-discount last-minute sales sites like HotelTonight.com?  What is the correct use of social media – is it a distribution channel or a customer engagement channel? How to take advantage of Google Places?

This is where AAHOA can play a crucial role by educating its members on direct online channel strategies, vanity website best practices, SEO, SEM, social and mobile marketing, online media and re-targeting, email marketing, etc.

Diverting online travel consumers from the OTAs to a new consumer website MyBestHotelRate.com is not only prohibitively expensive, but it does not help AAHOA members help themselves fight their addiction to the OTA distribution channel.  Instead, AAHOA should spend its organizational funds to develop robust educational and professional development programs for its member hotels, focused on the direct online channel, hotel digital marketing, and industry best practices and notable trends.

Click here to read the entire blog article on HOTELSMag.com, as well as a full selection of Max Starkov’s blog articles on hot industry topics and latest trends in the online channel in hospitality.

 

About the Author:

Max Starkov is President & CEO of HeBS Digital (Hospitality eBusiness Strategies), the hospitality industry’s leading direct online channel strategy, full-service digital marketing and website design firm (www.HeBSdigital.com)

 

The following article is Max Starkov’s latest contribution to the “Successful eMarketing” blog on HOTELS magazine’s website.

Back in early 2011, in an interview article “Another look at flash sales sites,” for HOTELS Magazine’s successful eMarketing Blog, I argued social buying and flash sales sites such as Groupon Getaways with Expedia, Living Social, SniqueAway.com, BloomSpot, etc. were a recessionary phenomenon, and not a new, emerging distribution channel that was here to stay. There is no doubt that as the economy improves, some of these flash sales sites will go away, and the remaining players will have severely diminished roles in hospitality.

Since 2001 we have witnessed a similar “countercyclical” increase and decrease in OTA market share: the better the economy, the smaller the OTA market share. As an example, the OTAs’ share of CRS reservations for the top 46 hotel brands increased from 11.8 percent in 2008 to a height of 17.1 percent in 2010 and shrank to less than 16.5 percent in 2011 (eTRAK, HeBS Digital Research). All trends point out that the OTA share will decrease to well below 15 percent in 2012.

I also cautioned hoteliers of the existence of “The Law of Unintended Channel Share Loss,” which stipulates the following: Any booking via the most discounted channel (i.e. Flash Sales Sites such as Groupon, LivingLocal.com or SniqueAway.com or an OTA) is one less booking for the same hotel via the hotel website, call center and GDS (in that order).

Last year, in several articles and industry presentations I predicted that as recessionary phenomena, the social buying/flash sales sites would suffer from an improving economy and rising travel demand. Why? Social buying and flash sales sites such as Groupon, LivingSocial.com, and SniqueAway.com are an integral part of the economy and the supply-demand market equilibrium. For social buying and flash sales sites to exist, there must be market equilibrium (price-quantity) between the demand side (quantity of members/engaged social buyers) and the supply side (quantity of fresh, intriguing deals).

Since travel consumers and customers in general (the demand side) are always open to discounts and deals of any sort, an increasingly important part of any social buying/flash sales site is its ability to convince the supply side, i.e. hoteliers, to run deals and accept the large discounts that are integral to the offers.

Similar to 2011, in 2012, all signs are indicating that the hospitality industry continues to be in recovery mode. STR projects all three of the key performance measurements (occupancy rate, ADR and RevPAR) will enjoy steady increases for the year as a whole: a 0.2-percent increase in occupancy to 60.0 percent; a 3.7-percent jump in average daily rate to $105.29; and a 3.9-percent rise in revenue per available room to $63.18.

As travel demand improves, hoteliers have already become reluctant to participate in social buying/flash sales sites because of their “open discount” business model, and provide the supply side of the equation with fresh, intriguing deals. As a result, both sides of the equation suffer and shrink. Online travel consumers, disappointed by the lack of fresh and intriguing hotel deals, have started reverting back to the traditional booking channels: hotel direct, OTAs, GDS and voice.

Here are only some of the indisputable signs of this weakening and shrinkage in the supply side we witnessed in 2011, which have already weakened the demand side as well:

• Visits to social buying/flash sales sites declined in 2011 by 25 percent since June 2011 (Hitwise), due to:
  • Too many competitors
  • Deal fatigue
  • Not enough good deals
• Groupon was forced to partner with Expedia
• Groupon: Customer acquisition costs are out of control:
  • Advertising costs: $263M in 2010 vs. $4.5M in 2009. $180M in Q1 2011!
  • Revenue per subscriber has fallen by 64.2 percent (06/09-03/11)
  • Number of deals sold per customer have decreased by 34 percent
• Off & Away, an aggressive hotel discounter, was forced to shut down at the end of 2011

 

The most recent developments in early 2012 further support my predictions for “shrinkage” of the social buying space. Groupon, Inc. shares fell more than 7 percent so far in January , 2012 – below the company’s initial public offering price of $20 – on “concern the company may not have as many daily deals to offer as some merchants pull back (as reported by Alistair Barr (Reuters).”

Susquehanna Financial Group and Yipit  (a daily deal industry tracking firm) surveyed almost 400 merchants recently about their experiences running daily deals with Groupon, LivingSocial and other providers. According to the survey, “52 percent of the surveyed merchants are currently not planning to feature deals in the next six months. Nearly 24 percent of the merchants intend to feature only one deal in the next six months, the poll also found.”

I told you so!

Why should hoteliers be wary of using the social buying/flash sales sites? Here are only a few of the reasons that the economics do not work for the hospitality industry:

• Flawed “Open Discount” business model:
  • Discounted rate is out in the open, which is against rate parity/BRG principles
  • Destroys rate integrity: against existing contracts (OTAs, corporate travel)
• Lack of opaqueness establishes new lower market price: Hotel cannot charge rack rate since customer has accepted the discount rate as the new market value
• Cannibalization of existing customer base: 65 percent of daily deal buyers are already frequent (38 percent) or infrequent (27 percent) customers (ForeSee 06/11)
• Deal face value is artificially ballooned to show value: This puts off potential customers by positioning the hotel as “too expensive”
• Steep discounts of 50 percent to 67.5 percent are simply unacceptable

 

Here is a case study clearly showing the true cost of distribution via the flash sales sites:

	A Full-Service Hotel in Washington DC
	Flash Sales [Groupon]	OTA	GDS	Hotel Website
BAR (Best Available Rate) – Two nights	$400	$400	$400	$400
Deal Face Value	$200	$400	$400	$400
Third-Party Commission	35%	25%	12.5%	0%
Net to Hotel	$130	$300	$350	$390
Cost of Reservation	$270	$100	$50	$10
Cost as Percentage from BAR:	67.5%	25%	12.5%	3%

 

As we see from the example, the cost of distribution via the social buying/flash sales site is 27 times higher than the cost of a booking via the hotel own website.

Why are some hoteliers still finding the social buying/flash sales sites attractive? There are two types of hoteliers in the industry:

• Smart, sophisticated hoteliers who understand that using social buying/flash sales sites leads to price and brand erosion, and ultimately damages the hotel’s price integrity and overall online revenues in the long run
• Hoteliers who employ a “lazy man’s approach” to hotel distribution and who are more interested in the immediate results, while ignoring or not caring about long-term repercussions

Some hoteliers participate in social buying and flash sales sites merely because their competition is doing so. My advice? Don’t succumb to the devil. A smart hotelier would never repeat the mistakes or dumb moves of a dumb competitor, so why do it now with the flash sales sites? Stick to the fundamentals in hotel distribution and make sure you are covering all your bases in the Direct Online Channel, including website re-designs, SEO, SEM, email marketing, social media, mobile web, online media, the voice channel, and GDS Travel Agent channel.

So, should hoteliers “flash or not flash” in 2012?

The answer is a categorical NO! As mentioned above, the economic model of social buying/flash sales sites does not work for the hospitality industry. The flawed open business model destroys rate parity and establishes a lower market price. The deals cannibalize hotels’ existing customer base while putting off potential new customers with artificially ballooned deal face values

What should hoteliers do in 2012 as far as the online channel is concerned?

The main focus and priority for any hotelier should be to sell as much inventory via the most cost-effective distribution channels that can potentially generate the most bookings while preserving rate parity and price erosion. This is the direct online channel – the hotel’s own website.

 

Click here to read the entire blog article on HOTELSMag.com, as well as a full selection of Max Starkov’s blog articles on hot industry topics and latest trends in the online channel in hospitality.

 

About the Author:

Max Starkov is President & CEO of HeBS Digital (Hospitality eBusiness Strategies), the hospitality industry’s leading direct online channel strategy, full-service digital marketing and website design firm (www.HeBSdigital.com)

By Margaret Mastrogiacomo

With the rapid growth of the mobile channel, SMS marketing is becoming a vital component of a well-rounded digital marketing strategy. Unfamiliar with Best Practices for leveraging this channel, many hoteliers are missing out on one of the most effective ways to connect with customers anytime, anywhere.

With more than 7 trillion text messages sent around the world in 2011, it is no secret that mobile users are hyper-engaged and hyper-connected via mobile messaging. Why is it then that marketers continue to overlook this opportunity to build a relationship with customers?  In a recent Hipcricket survey of mobile users, 57 percent of respondents said they would be interested in opting in to a brand’s SMS loyalty program. Yet, 80 percent of survey respondents said they have not been marketed to via SMS by their favorite brands. Even more compelling, 90% of survey respondents who had participated in an SMS loyalty club felt they had gained value from being a part of the program.  Why the hesitation to include SMS into the marketing mix? Many hoteliers simply don’t know where to start, and are rightfully cautious to reach consumers through this nascent channel.

Despite hoteliers’ apprehension to engage in this channel, many hoteliers understand the potential SMS offers to effectively reach consumers. In HeBS Digital’s 5^th Annual Benchmark Survey on Hotel Digital Marketing Budget Planning, 25% of hoteliers indicated that SMS marketing was an initiative they planned to leverage in 2011.

 

What mobile marketing initiatives are you planning for?	2010	2011
Mobile site	25.9%	37.5%
Mobile booking engine	22.4%	37.5%
SMS Text marketing	27.6%	25%
Mobile banner advertising	19%	12.5%
iPhone app	24.1%	8.9%
I am not planning on mobile marketing initiatives for 2010	32.8%	38.4%

 

What are the Types of SMS Marketing?

There are two basic types of SMS marketing: mobile push and keyword opt-in. SMS push marketing is the sending of a mobile blast via text message in 160 characters or less. Mobile pushes can promote a contest, special, upcoming event, or last minute rates.

Even more important for engaging customers is an interactive keyword opt-in campaign.  A keyword opt-in campaign prompts users to text a designated keyword to a short code (a short series of numbers) to opt-in to a mobile list. Users immediately receive an auto-response marketing message revealing promotion details or announcing successful opt-in. Some creative ways to engage guests via keyword campaigns are mobile trivia surrounding the destination or property, mobile sweepstakes, and allowing customers to “unlock” deals.

Before leveraging SMS in your marketing mix, it is imperative to prepare an SMS marketing strategy in line with Best Practices. From understanding the personal nature of mobile to setting clear metrics to measure performance, HeBS Digital explores SMS marketing Best Practices and the right ingredients for mobile marketing success.

 

Top 20 SMS Best Practices

1. Remember it’s personal.  Just as you respect the privacy of your hotel guests during their stay, it is important to respect the private nature of their mobile phone. A mobile device has become one of the most personal belongings for customers. This device is the gateway to a user’s photos, email, social media profiles, agenda, and more importantly, personal conversations with friends and loved ones.

When engaging in mobile SMS marketing, it is extremely important to ensure that your campaign provides meaningful content that resonates with your customers. Otherwise, you risk your SMS campaign delivering with the intrusive nature of a telemarketer. What’s the first step in connecting with your customers via SMS on a personal level? Focus less on the use of the technology and more on the people using it. Tap into your customers’ passion points and align with them.

2.  Don’t send a mobile push unless you have engaged with the customer via mobile campaign within the last four months.  A key thing to remember when sending an SMS blast to any mobile list is that your customers must be aware that they’ve opted-in to receive mobile messages, and that they are comfortable engaging with your brand on the mobile platform. As tempting as it may be to export mobile numbers from your email list or a database you’ve collected over time, these customers have yet to engage with your brand via SMS. Sending a mobile blast to users who have not participated in a keyword opt-in campaign will seem intrusive and unexpected in the eyes of the consumer.

To avoid this, engage with your customers with a fun and relevant keyword campaign where they text a keyword to a short code to interact with your brand and opt-in. This will get your customers comfortable and familiar with your brand on the mobile platform. Within four months of this mobile interaction, you can begin sending mobile pushes to the opt-in list. Customers now expect messages from your brand via SMS and will always have the option to opt-out with every message sent.

3. Provide customers with value. Make sure every mobile campaign and mobile push is highly relevant to your customers and provides unique and useful value.  Part of ensuring that mobile messages speak to your customer segments is keeping in mind the immediate, hyper-local nature of mobile that allows us to reach our customers anywhere, anytime.

 First, consider the demographics of your customers and their mobile behavior. A mother who is interested in booking family travel has very different lifestyle behaviors at 10 am on a Wednesday than she does at 12 pm on a Sunday. It’s vital to reach your customer segments at the right time with the right information.

It’s also important when putting together your SMS strategy to consider ways to keep your customers connected and build a brand relationship. How can you reach your customers on a consistent basis and either help enhance their everyday life or make their lives easier? For instance, if your hotel property has an onsite restaurant that you wish to promote, you may want to consider launching a Chef’s Tips mobile campaign where once a month you send cooking tips a few hours before the average dinner time. These messages can include links to easy recipe ideas and fun cooking advice.  This message is immediately relevant to your customers’ everyday life and is a great way to stay connected.

Remember, SMS is a way to reach your most loyal and passionate customers. Allow your customers to opt-in to monthly messages or tips that tap into their passion points such as cooking, family travel, wine, and more.  Sharing recipes from the onsite chef, beauty and health tips from the onsite spa, or even wine recommendations and wine-tasting tips, are great ways to keep loyal customers engaged with your brand.

4. Keep it interactive with mobile keyword campaigns, contests, and trivia. Remember, mobile should be engaging. Including fun and creative keyword campaigns and mobile trivia that speaks to your customer segments is a great way to build a brand relationship and generate revenue.

 Consider running a “Secret Ingredient” promotion featuring a hotel special package that has a surprise add-on or free gift. To redeem the package and find out the secret add-on, customers have to text the keyword to a short code. The auto response message will reveal the add-on and the promo code to book the package. A successful HeBS Digital mobile SMS opt-in campaign generated 76 mobile opt-ins, 23 room nights, and 636% ROAS.

 Other engaging campaigns to consider are fun mobile trivia surrounding a hotel or brand theme. Here is a great opportunity to highlight interesting facts and selling points of your hotel. Don’t be afraid to get creative with your trivia. Fun destination themed trivia tends to perform best.

5.  Make it clear that customers are opting in. When a customer participates in your mobile campaign, always make it clear that by texting a keyword to the short code they are opting in for future mobile messages. To be safe, you may also want to include a double opt-in.

6. Test. Test. Test. With any new marketing channel, it is important that you put your trust in industry experts and develop a clear outline of necessary tests before the launch of every mobile campaign.  Before launching any mobile campaigns, create a test list of mobile numbers to receive your marketing message. If you are launching a keyword campaign, be sure to have 3-5 people text the keyword to the short code and examine the auto-response message.  Make sure that the message is correct with a clear call to action and all shortened links included are properly working.

7. Capitalize on the immediacy of mobile.  The mobile channel allows you to reach customers anytime, anywhere. Take advantage of this immediacy to promote last minute specials to your local feeder markets.

 SMS mobile blasts are perfect for marketing your onsite restaurant to locals. Alert your local customers of happy hour specials, new entrees added to the menu, and upcoming events.

8. Include clear opt-out instructions with every mobile message sent.  Just as customers can opt-out of an email list at any time, every mobile message must include the option for customers to opt-out. Without this option, customers will feel prisoner to your marketing message and it will taint the brand relationship.

9. Define clear metrics of success. The success of an SMS campaign can be a hard thing to measure. Before launching any SMS campaign, set goals that you want the campaign to achieve. If the SMS campaign includes a link, click-through rate is a great way to measure the effectiveness of your mobile blast. Other metrics include number of mobile opt-ins for a keyword campaign, redemption rate for promotions utilizing mobile coupons or promo codes, contest sign ups, increase in mobile website traffic, and brand awareness.

10. Include a clear call to action or instructions to redeem in the mobile message. Reaching customers with your mobile marketing message isn’t enough. For a mobile marketing campaign to be successful there must be a clear call to action. Once you set goal metrics for your marketing campaign, include a call to action in your marketing message that helps you achieve your metrics of success. Whether it be texting a keyword to a short code, booking a package, or signing up for a contest, make your call to action clear with no more than two steps for customers to reach your end goal.

11. Utilize mobile coupons. One in ten mobile users redeem mobile coupons (emarketer).  Mobile coupons are a great way to drive bookings and increase incremental revenues.  Consider utilizing mobile coupons for up-sells and add-ons to special packages. Allow users to text the add-on of their choice to a short code to receive a mobile coupon to redeem by presenting at check-in.  Mobile coupons are also a great way to drive foot traffic to your onsite restaurant or spa.

12. Utilize the mobile channel for your most loyal customers. Keeping in mind the personal nature of mobile, you want to utilize this channel for your loyal customers and Brand Ambassadors. Consider integrating mobile into your hotel’s loyalty program, or create a mobile loyalty program if one doesn’t already exist.

The mobile loyalty program can grant members access to exclusive offers, insider updates, and travel tips. You can even consider rewarding members with a mobile coupon valid for the month of their birthday or special occasions.

13. Segment your mobile lists to send more targeted messages.  A highly targeted mobile marketing strategy means a higher campaign conversion rate.  There are creative keyword opt-in campaigns you can implement to segment your mobile list based on interest and location.

To better target your mobile customers by interest, consider creating segmented deals for customers to “unlock” by texting a keyword to a short code. These deals can be segmented by spa, dining, hotel, and events. Website visitors will be prompted to text the category of their interest to the short code to receive mobile alerts for that particular category.  This helps ensure that mobile messages are highly relevant to the customers who receive them.

To better target your local customer segments, consider a landing page on your website dedicated to locals where they can opt-in to receive mobile alerts for dinner specials, last minute rates, and news on upcoming events.

14. Direct users to a mobile landing page. One of the biggest mistakes that marketers make is sending a mobile blast that doesn’t link to a mobile landing page. When executing any mobile campaign, always keep the user experience in mind.  If a customer follows a link on their mobile device and it leads them to a landing page that is hard to navigate or read, this is going to dramatically affect your conversion rate.

15. Remember that mobile is just one touch point in a multi-channel strategy.  For true SMS Marketing success, you must integrate SMS into the comprehensive marketing mix. You can promote keyword opt-in campaigns to your email list, highlight your mobile promotions on your hotel website, feature your mobile promotions on your social media profiles, and even integrate SMS into your banner campaigns.

Don’t overlook the utility that SMS messaging provides. On the Maps & Directions section of your hotel website, include a “Text to get Directions” option so website visitors can easily access directions to your hotel from their mobile device.  Other great website utilizations of SMS are a “Text Event Details” on your hotel website’s Calendar of Events, a “Remind Me When This Special Ends” alert on hotel special packages, and a “Text Reservation Details” on hotel reservation confirmations.

16. Include images when possible. Just as rich imagery on your hotel website sells your property and destination, including an image with an SMS blast helps to increase conversions. Make sure your image corresponds with the details of your offer to enhance the effectiveness of your campaign. For instance, if you are promoting a summer special, rich imagery of a hotel’s rooftop pool will make the package more enticing for customers.

17. Ask customers to register their preferences. The frequency in which a customer receives a mobile marketing message can mean the difference between an opt-out and a life-long mobile subscriber. Send customers a mobile survey asking them how often they would like to hear from you and what topics interest them most. This way all messages are highly targeted and your mobile marketing strategy is in line with customers’ preferences.

18. Learn from the results. Simply measuring the success of your campaigns is not enough. Analyze the results to shape future SMS promotions to better target your customer segments and increase conversions. Some key questions you should ask yourself: What is the best time of day to send a mobile blast based on past results? What types of campaigns have the highest number of opt-ins? Which customer segments are most engaged with my brand via mobile, and how can I provide these customers with more value?

19. Know your competitive set.  Just as you know what services the hotels in your comp set provide guests, it is important to understand how your comp set is engaging with customers via SMS marketing.  If available, consider opting-in to your competitors’ SMS lists to understand how they are staying connected with customers. What are they doing well? How can you differentiate your hotel’s SMS marketing strategy?

Browsing a competitor’s website is a great way to see if they are running any SMS promotions.  If you find the majority of your comp set isn’t running any SMS campaigns, this presents an even greater opportunity to own this channel with your customers.

20. Find a trusted partner. Finding an SMS marketing vendor that has a secure, intuitive platform and expert advice in SMS Best Practices is not always easy. Make sure you do adequate research to find the right vendor who meets your needs. Aside from exploring the vendor’s SMS platform capabilities, ask for case studies, client testimonials, and details regarding their client assistance services. The right vendor won’t just help you launch SMS campaigns; they will assist in executing a successful SMS strategy.

 

Conclusion

The immediacy of SMS and the opportunity it presents to build a deep connection with customers can no longer be ignored. Mobile is a way of connecting with your audience, tapping into their passion points, and allowing your guests to welcome your brand into their lives.

With any new channel, a well-executed strategy that understands its audience is key. For true success, no channel can exist as an island and should be integrated into a comprehensive marketing mix including multi-channel campaigns and promotions.

Remember to set goals and define metrics of success before launching any SMS campaigns.   These metrics will guide your SMS strategy and campaign execution. Learning from the results of your campaigns is the true secret to SMS success, and with Best Practices and professional consulting, you can watch your SMS strategy soar.

 

About the Author

Margaret Mastrogiacomo is Manager, New Media & Creative Strategy at HeBS Digital.

by Sue Wiker and Will Jerome

Every year, Google makes more than 500 updates to its search algorithm. The most significant update in 2011 was the Google Panda Update, now in version 2.5, which made most hotel websites obsolete by introducing very strict requirements for content, interactivity, and page download speeds. This required sites to generate engaging and unique website content (as opposed to bland, old and tired content) that would intrigue users and increase the site’s “stickiness.”

After frustrating hospitality digital marketers with the seemingly never-ending Panda update saga, Google went a step further by releasing the broadest, most-impactful algorithmic change to date, just to keep us all on our toes. Last week Google announced that they had rolled out an update now known as the “Freshness” update, which was said to affect 35% of total searches and would allow for more relevant, current information to be displayed for a bevy of high-volume search queries.

Why are these updates important for the hospitality industry? Between 50%-70% of hotel website visitors and website bookings originate as leads from the major search engines.

The update, essentially, is an amendment to the “Caffeine” update Google rolled out in 2010, whose sole purpose was to make general search queries 50 percent “fresher.” So when you were searching for a sports score or who won last night’s election, for example, you would be delivered the most up-to-date articles and commentary. Problem is, in only a year’s time search queries have risen in number and the amount of online media continues to grow. Each story – each topical event – is being discussed, reported on, and dissected hundreds and thousands of times over, simply because the platform is available and the medium, the Internet, is effective. This is what spawned the rise of this new “freshness” update that has set off alarms from Palo Alto to the burgeoning tech hub that is New York.

So who does this new “Freshness” Update affect?

Every online entity. No longer can we truly separate a blog, a news site and a content site that offers up-to-date “local news” in the form of local events, happenings or promotions such as a hotel website.

Let’s use the news sites as a case study. Articles discussing political news, global news, sports news, celebrity news – things that change at the drop of a hat – will be refreshed within SERPs more than ever before. For example, the night before this blog post was written the Philadelphia Eagles lost to the Arizona Cardinals. Here is what the first page SERP looks like for the query “Arizona Cardinals beat Eagles:

 

As you can see, a search with no defined publish date (note: the search was set on “any time”) returned only results that were published within the last 24 hours, some as recent as an hour! And what makes this more amazing is that this isn’t the news feed, this is the organic listing as it appears. But, of course, this is a sports score, an instrisically topical item with an extremely low shelf life.

How does this latest Google algoritm update apply to hotel queries?

Traditionally, hotel websites are content rich vs. news rich, with descriptions and information featuring and explaining in detail every facet of the hotel business and service, from the bed linens to the capacity of a meeting room. The “static” content is there, but the “fresh” content is certainly lacking, and this is the main issue with current hotel websites after the latest Google algorithm updates.

So if hotel websites aren’t intrisically fresh, then how do hoteliers respond to the latest Google “Freshness” Update?

Case Study: HeBS Digital CMS Plus and the Google Panda & “Freshness” Updates

HeBS Digital’s proprietary website content management system (HeBS Digital CMS Plus) was specifically conceptualized and built to accommodate the stringent Google Panda and “Freshness” updates by allowing hotel marketers to maintain fresh content on the hotel website in the form of:

• Promotional landing pages for timely specials and packages (e.g. a March Madness package as opposed to an Advanced Purchase package valid for all of 2012)
• Event landing pages for events and happenings at the property and in the destination
• Promo tiles and banners on the website for featured specials and events
• Marketing and sales messages in the main image window on every page focusing on various aspects of the hotel product: room and dining promotions, complete meeting packages, wedding promotions, etc.
• New content pages on various topics: from seasonal and sports events, to local festivals and customer segment-specific content (family travel, seniors, weekend travel, romantic getaways, etc.)

Each local promotion or event page has “micro-formats” applied to it, which are rich snippets of data that signify to a search engine that these events are in fact stand-alone, current events, with exact starting and ending times associated. These ensure that all of our events are viewed as “current” rather than repetitive or stagnant.

Schemas codes are also incorporated on all time-sensitive landing pages: local promotions, special offers or events at the property and in the destination, as well as on a variety of pages site-wide: dining, accommodations, hotel services and amenities, etc.

The result?  A typical single-property website has 40-60 pages of content indexed by Google. The HeBS Digital CMS allows clients to build a multitude of new landing pages and fresh content over time, and typically has over 2,500 -4,500 pages of relevant and deep content indexed by the search engines.

What else do we recommend hoteliers do?

Blog, Blog, Blog!

Oftentimes, we incorporate a blog onto a hotel website. This serves as a section of the site that constantly and continually provides new content about both hotel-related information and regional topics. It offers quality content – content people want to link to and share – for a website that is not in the content-creaton business. Blogs allow hotels and restaurants to highlight specials and events as well as general hotel news. Talk about local events, highlight someone’s stay, discuss seasonal activities in the area, or feature infographics about your hotel or region that deeply engage users. Blogs allow hotels to spread a message they otherwise couldn’t, and spread it instantly. We recommend blogs to hospitality websites that are concerned about new content creation. There is simply no better platform.

Focus on Social Media Interaction

We also recommend incorporating real-time Twitter feeds and Facebook interaction information in the hotel website to ensure that interaction is recorded, up-to-the-minute, and relevant. The transparency of our actions boosts our standing in accordance with the new standards in place from the “Freshness” update.

Having a strong presence on Twitter and Facebook are excellent steps to take to ensure that you  are constantly broadcasting news about your brand, whether it’s new promotions and vacation packages, group travel deals, sweepstakes and giveaways, or upcoming events at the property or nearby. This type of topical messaging can generate frequent interaction with your business. This messaging should be deeply intertwined with your website, meaning your website should reflect your usage of social platforms, whether that’s a live Twitter feed, Facebook “like” buttons site-wide, or even Google+1 buttons. Interaction is certified fresh.

Make Sure Your XML Sitemap is Up to Date

XML sitemaps are vital in allowing search engines to gauge the true depth of a given site and quickly crawl the pages that you are displaying. Oftentimes, however, sites can fall prey to the viscious affliction known as apathy: they don’t update their XML sitemaps when new pages are developed, new events are displayed, or new specials are pushed live. Make sure you stay on top of XML sitemap updates and Google will see only the freshest backend view of your site.

For every update we apply to a website we ensure this is reflected in the XML sitemap, so that when a search engine crawls our XML sitemap to gauge a site’s depth, there are no missing pieces or erroneous information. It will appear as up to date as the visible content suggests it is.

A Word About the Schema Code

“What’s a schema?” Schema code is a relatively new code-based element that Google released at the end of June 2011. In simple terms, they can be viewed as augmented meta data. They allow you to describe, in depth, details about a given page, sale, or event that otherwise wouldn’t be included on the website. For every dining page, packages page, event  page, our hotel page, and any other content-rich page on the site, Schema codes allow you to embed in the code exact information such as geographical location, start and end date, author or host, sale paremeters, sources about a subject, and a litany of extra granular points of information. These back-end bits of code enhance each page from an informational standpoint, and allow search engines to better understand what a page is all about and what exactly the page is targeting. It’s all about context and intention, things that topical search queries are framed around.

Conclusion:

• The Google Panda Update made most hotel websites obsolete. Bare, sparse copy stuffed with keywords can no longer sustain a respectable SERP ranking.
• The latest Freshness Update created the need to add fresh content to the website on an ongoing basis.
• In order to react to these two algorithmic updates, hoteliers need to re-evaluate their website re-design strategies and budget for website re-design or an optimization overhaul in early 2012.

Be proactive when dealing with your content and the various assets you own. Highlight what’s great about you and make sure that whatever you’re proud of is reflected on the back end of your website, on social media, and within blogs and press releases. Success will continue to come, especially if you stay ahead of the curve.

Sue Wiker is Lead Copywriter and Will Jerome is SEO Specialist at HeBS Digital.