Saturday Essay: Digital Marketing Can Provide A Lifeline To The Hotel Sector
Photo by Belinda Fewings on Unsplash
The hotel sector has been particularly hard hit by the recent waves of Covid lockdown restrictions.
These tough trading conditions have made it even more important for hotel owners to harness the power of digital marketing and Ecommerce, to improve their flow of future bookings, and bounce back as quickly as possible.
Successful operators are discovering that digital marketing can provide a lifeline.
Beware of neglect
With the many demands of running a hotel, it’s easy to understand how websites for independently owned and managed hotels can quickly become neglected.
Slow operating speeds, non-secure technology and a lack of direct online booking facilities can often mean that hotel owners submit to the terms of online travel agents (OTAs) where high commission fees affect margins and profitability.
This is not a sustainable business model and given the urgent need for hotels to balance their books, due to Covid related lost bookings, the emphasis, more than ever, is about occupancy, particularly mid-week occupancy, which historically can languish at 30-40% in off peak times.
I recommend to hotel owners that they stop relying purely on the OTAs and look to generate direct bookings, to enhance their margins.
By becoming more visible, enhancing their websites through simple booking facilities, and automating loyalty-building processes, hotels can take back the impetus and build direct relationships with their clients.
We’re seeing it in the insurance and other sectors: the aggregators hold too much power and generate excessive profits, whilst the businesses that are delivering the service are left with a lesser margin.
Own the booking process.
The online market for hotel bookings has developed dramatically in the past few years. With this in mind, I recommend to savvy hoteliers that they invest in their own online room booking facility and move away from the brochure model.
This enables them to fully control their online reservations process, own their clients’ data, and most importantly, maximise their deserved margins.
At Ascensor, we have been engaged by a number of hotels to drive visitor website traffic and online bookings. These include Raithwaite Sandsend (recently rebranded from Raithwaite Estate), a coastal retreat near Whitby, North Yorkshire, and Burgh Island Hotel, a fully restored art deco landmark on a private island, off the South Devon coast.
We have also recently been commissioned by Gatton Manor Hotel and Country Club, Surrey and Orton Hall Hotel, Cambridgeshire, to deliver new websites and digital marketing.
Staycation scramble: market opportunity
As Covid restrictions ease, hoteliers face a unique market opportunity where customers are desperate to take a well-earned break. However, giving the trading losses experienced through the lockdown period it’s vital to manage occupancy.
In what the press are describing as the ‘staycation scramble’ it’s easy to imagine that full occupancy requires little effort, but away from the peak school holiday season, hoteliers still need to work hard to woo customers.
The opportunity costs for hotel owners are massive. Unlike a market in which physical stock is traded (and can be stored and sold later), the hotel sector has to confront profitability issues on a daily basis. Tonight’s unsold rooms are an opportunity lost and can quickly provide a drag on margins. So, I recommend to hotel owners that now is the time to deliver excellence in their digital marketing.
Understanding customers’ expectations
It’s vital to remember that whilst customer demand is high, so is customer expectation. More than ever, holidaymakers want every aspect of their holiday booking to be seamless and secure. And that includes the booking process. Customers with money to spend still demand value, and hotels which understand how to provide a memorable online customer journey will win out.
With the current demand for staycationing, it’s more important than ever that hoteliers understand the role and value provided by website modernisation and continual optimisation.
Single minded approach
Digital marketing is crucial within any industry, and it’s extremely effective in the hospitality market. We are established in this sector and provide a range of digital marketing services, enabling our hotel clients to rank high in search results, and to be found quickly and easily by their potential guests.
Website design and digital marketing demand a clear focus, and our role is to adopt a single-minded approach, enabling us to drive our clients’ sites forward and improve the conversion of site visits to bookings.
Showcasing the proposition
For example, the luxurious Raithwaite Estate on the North Yorkshire coast, has recently created a new brand identity and has evolved to become known as Raithwaite Sandsend.
To properly showcase and promote their new identity, Ascensor built Raithwaite a bespoke website to ensure that they could convey the message they wanted.
I remind clients it’s vital that luxury accommodation is displayed clearly and effectively online. In this case, we ensured that each style of room had its own page with a standout image and key features listed.
In addition to developing a compelling hotel booking website, we have also recently built the ‘Village’ area of the Raithwaite website to support the owners with the sale of properties, as part of the ongoing estate development that includes a community village.
This work demonstrates how we were able to achieve significantly higher levels of website traffic, increased room bookings and significant interest in the adjacent village development.
Most importantly, we have helped Raithwaite Sandsend to achieve more than 90% occupancy in May and June, including strong mid-week bookings.
Breadth of approach is important
Of course, digital marketing is a wide discipline, and is not confined to website presence and performance. It can also include online advertising and promotional activity.
A recent example of taking a broad approach is Burgh Island Hotel, an architectural gem, located off the coast of Devon. It is an iconic landmark that has been welcoming guests including Agatha Christie, Noel Coward and many other pre-war luminaries since 1929.
Our role was to drive more bookings for Burgh Island Hotel with the main focus on improving brand awareness through paid ads, increasing bookings by driving high quality traffic via a promotional offer, and reducing the cost per acquisition of online advertising by using an alternative to booking websites.
ROI is imperative
Burgh Island Hotel
Hoteliers have always had to have a laser-like focus on costs, and their marketing investment needs to drive commercial benefits. We helped Burgh Island Hotel to achieve a return on investment of almost 550%, with a return on advertising spend of more than 800%, helping them move to fully booked status.
So, by increasing the number of direct bookings for our hotel clients, we have also reduced the role of online travel agencies and so improved their acquisition costs. It’s crucial to remember that whilst booking volumes are important, so is profitability.
Hoteliers who own an increasing proportion of their booking through direct reservations on their website have control of more than just their revenues and margin. They also build their own database of customers.
So, rather than relinquish control of customer data to an online booking service, they can build loyalty and engage with their customers directly, using social media, e mail and direct marketing.
By creating a series of midweek and out of season offers, they have the ability to own the customer relationship, build loyalty and optimise long term profitability from repeat business.
Social media is powerful for hoteliers
Well planned social media, delivered consistently well, is key to generating brand awareness for hoteliers.
I recommend to independent hoteliers that they choose the social media platforms their guests are most active on. For example, if their target audience includes millennials, then Instagram and Pinterest will probably provide more reach. If they are offering leisure breaks for retired guests, then Facebook is likely to be a more relevant channel.
Our role is to help by developing testing, so that we can optimise the best performing social media channels.
Engagement is key to digital marketing
Engaging with future and previous customers is vital for the success of a hotel’s brand and its flow of bookings. I advise hoteliers to regard their social media channel as a form of online concierge service, with well delivered content on local attractions, events and reasons to visit.
Social media is a recommended channel for the continuous communication of upcoming hotel offers, activities and events. These can be mid-week accommodation packages, seasonal celebrations or exciting changes to food and beverage offers. Variety is important.
Managed well, social media can provide a valuable channel for creating and building a strong, personal connection with future and previous clients. In this way hoteliers can direct guests back to their own website, to book directly, bypassing OTAs in the process.
And because strong social media content is shared within friendship groups, it means that satisfied customers are frequently given the opportunity to recommend their favoured hotel to their family and friends.
Most importantly, social media is cost effective direct engagement, where messaging can be planned in advance, as part of your overall online plan, and also delivered at speed, if tactical accommodation packages need to be marketed at short notice.
Our work for wedding venue Thief Hall, Northallerton, demonstrates the pivotal role of customer engagement through social media.
With well devised content on Instagram, TicToc and Pinterest, we have created brand allegiance and helped to make this a first-choice wedding venue for couples planning their small scale Covid-safe wedding, or a larger scale wedding following the easing of restrictions.
We work with our client to include practical tips on how to plan a small wedding and make it Covid safe, at a time when many of the larger hotel chains’ wedding teams have simply closed shop. This is a great example of how digital marketing can be adapted to meet tough trading conditions, engage customers and achieve profitability.
I’ve focussed on the challenges faced by the hotel industry as we emerge from Covid lockdown. I hope that my advice has been helpful in demonstrating that now is the time to deliver excellence in digital marketing and website engagement, to drive direct bookings and retain the maximum amount of profit to maximise the bounce-back.
Good luck to all our regional hotel and hospitality businesses as the lifting of lockdown continues.
Andrew Firth is the MD of Ascensor, a digital marketing agency in Leeds, that has been offering website design, development and digital marketing services from large global companies to start up enterprises, and everyone in between, for 13 years. In January 2021 the firm won Best Large Digital Agency of the Year in the Northern Digital Awards.