March 09, 2016

Getting out from under Expedia


Google’s and Bing's search algorithms are built to serve the most useful and relevant content and ads to consumers. This means that no matter how large OTA budgets are, hotels have a leg up on relevance.

By Andrew Peterson, Iterate Marketing

In today's digitally saturated landscape, maintaining a marketing action plan is the single most important task for hotel managers and owners. As with any business, you can control your operations and facilities, but demand for services will always be an external factor. Marketing methods for business and recreational travel have evolved with the expansion of digital services, and many hotels are unable to maintain margins like they used to.

The Situation

As traditional travel agencies have declined, decision making power has shifted into the hands of the traveler. Online Travel agencies (OTA’s) have stepped in to commanding market presence, and hotels have to play nice if they want a slice of the pie.

OTA’s function as a one-stop-shop for travel planning by hosting transportation, accommodation, recreation, events, and dining options online. Reservations are a few clicks away for the traveller, however the lodging providers are fronting the reservations fees. Hotels love and hate OTA’s at the same time. On the one hand, they are filling otherwise empty rooms, and on the other they are losing revenue to referral fees. OTA’s like Expedia, Travelocity, Trivago, Kayak and Priceline charge hotels as high of 25% for serving them bookings on a golden platter. This can force hotel managers to cut operational costs to keep up with diminishing margins, which then hinders their ability to provide the best service possible.

How Can Search Engine Marketing Save Your Hotel?

Not only are Online Travel Agencies commanding market share with billion dollar ad campaigns, they are in fact undercutting the businesses they host online by competing in AdWords and Bing Ads.

It is now a standard to see advertisements for Expedia and Travelocity in search engine results during your vacation planning. There is a clear incentive for them to maintain traffic numbers to their site, because that's what keeps them afloat, but this brings them into competition with the hotels they are supporting.
Fear not! Even though the Expedias of the world have massive AdWords budgets, there is still hope for individual hotels.

Hotels Have The Advantage

Google’s and Bing's search algorithms are built to serve the most useful and relevant content and ads to consumers. This means that no matter how large OTA budgets are, hotels have a leg up on relevance. A secondary wild card is that OTA SEM management is simplistic, simply due to issues of scale. Online Travel Agencies set up broad match keywords and overbid on poor structure, so hotels have a major opportunity to compete. Now that I have your attention, let's go through some SEM strategies for hotels.

Account Structure

Proper account structure is always the answer to many businesses failed SEM attempts. For hotels, create campaigns with tightly themed ad groups and ad destinations. This means creating a direct alignment between your targeted keywords, ad units and final destination. This gives you the best chance to serving ad units above OTA’s in the SERP without costing an arm and a leg, as a high quality score will keep your cost down for the top slots. The most important structural benefit will be segmenting either campaign or ad group structure by match type, so the account is easier to control and optimize.

Keyword Targeting

Keep your keyword targeting simple and focus on brand keywords with location as a qualifier (hotel name, city). You want to structure your keywords with search intent in mind, because these are the phrases people will use when searching for lodging options. Instead of building out long tail keywords with all match types, launch with an even split between broad and exact match. Start with low quantities of highly relevant keywords and add longer tail exact match keywords over time. You do so by mining the search query reports for your broad match campaigns to find search terms that both triggered your head term keyword and converted.

Remarketing Lists for Search Ads Promotion

On average, people will review 38 digital travel resources before making a final reservation. This desire by travelers to make informed decisions presents a fantastic opportunity to recapture potential visitors. Remarketing Lists for Search Ads (RLSA) campaigns function by layering targeting of previous site visitors on top of current or predefined search ad campaigns. If someone who's already visited your hotel website searches for "Seattle hotels" a few days later, you need to appear right at the top. When people are jumping back and forth between search engines and travel resource sites, hotels should feature unique promotions or CTAs to capture that interest. You can even increase the value of your promotion depending on how close the user is to making a purchase. Remarketing campaigns can have up to 300% conversion rates as opposed to traditional search campaigns.

Dynamic Display Remarketing

Similarly to RLSA campaigns, dynamic display remarketing works by targeting previous site visitors at unique stages of the purchase funnel. Dynamic display differs from traditional display remarketing by featuring unique content to the potential vacationer.

If a user is jumping through your site and shopping for specific date ranges, location, and even room type, you can use Dynamic Display Remarketing to serve them customized ads on other sites. These campaigns require technical integration with both the site and reservation system, but is well worth the investment.

Inspirational Travel Resource Content

OTA’s are so successful because they offer convenience in comparison shopping, friendly user experience - but most important, breadth of relevant content. These sites are filled with images, videos, reviews, descriptions etc. This approach is highly beneficial for OTA’s because people require this content when planning a trip.

Hotel sites have the ability to be a valuable resource for not only their facilities, but the destination in which they're located. The more information you can host about your destination, the more likely users are to stay on your site and book. Hotels are also directly incentivized to sell people on the destination, because that is the reason people are even looking at your hotel.

Have content built out for local attractions, restaurants, nightlife, local events, shopping, and activities. This information allows for even more keyword expansion in your ad account that OTAs don’t have the time or ability to compete on. Be the destination leader for information to capture the highest percentage of occupancy in your area.

In Conclusion

As a lodging manager, you have the opportunity to use intelligent marketing practices to get out from under Expedia's thumb. While you will never be able to dispense with OTAs altogether, any visitor who you can convince to book directly with you is money in your pocket. Search Engine Marketing techniques provide the opportunity to reach your visitors as they plan for travel at a much lower cost.

You can beat Expedia at the marketing game, and attract more visitors, simply by implementing:

- A focused account structure that cuts down on unnecesary costs

- A narrow set of destination keywords that you will expand based off booking data

- Remarketing lists to serve search ads to users who have already looked at your hotel

- Dynamic Display Remarketing to serve personalized ads based on specific travel plans.

Andrew Peterson is a Search Engine Marketing Strategist with Iterate Marketing in Portland, OR. A graduate of Montana State University, he has a passion for travel and the great outdoors, and has worked in destination marketing before shifting his focus to help small businesses with search engine marketing.