Allocating the appropriate amount of your property’s overall marketing budget to online marketing can be more of an art, than science. Here’s why you need a significant investment in online marketing to increase direct bookings and key areas to focus your efforts on to realise the highest digital ROI.There are more channels than ever to reach travel shoppers. The online channels travel shoppers use to research and book travel continues to grow. From the traditional channels such as direct websites with engaging search engine optimised (SEO) copy and pay-per-click (PPC) advertising campaigns, to the growing channels like social media and mobile websites, Internet marketing is complex – a maze of branding and promotional messages from properties mixed with user generated content and reviews from travellers. With a more fragmented way to reach consumers, more resources must be allocated to reach them.
The industry is seeing steady recovery. According to STR, during the week ending August 20, overall U.S. revenue per available room grew 7.6 percent from 2010 to 2011. Furthermore, PwC’s latest research shows 2011 is on pace to have a 4.6 percent growth in lodging demand over last year. No matter how bright the horizon though, you’re likely still working with a limited budget - but that doesn’t mean you can’t make it work exponentially in your favour, especially in regards to online marketing.
Internet marketing produces the highest ROI with the most accountability. The Internet easily produces the highest ROI and best value in hotel marketing and is the only growth channel in hospitality. Unlike other areas, the results of marketing efforts are measurable and transparent. Smart hoteliers can use this information to their advantage to track, modify, and reinvest with confidence in revenue producing efforts.
SO, HOW MUCH SHOULD YOU SPEND?
The question of how much exactly a hotel should invest in Internet marketing is still up to the individual property, since each faces unique market segments and has unique goals and objectives for growth. For example, if you’re a select service brand with meeting space, you may need more budget allocated to creating or updating your proprietary website and SEO. If you’re an upscale independent resort, you may need to increase the amount allocated to PPC advertising.
A general rule of thumb focuses on proportional spending.
If you have a goal that 30 percent of your total sales be Internet generated, roughly 30 percent of your budget should be Internet allocated. Now this is by no means an exact science (some brands have more marketing support than others, some independents rely more heavily on independent websites, etc.), but serves as a good starting point for most properties.
It’s crucial that online marketing is a priority when planning your 2012 marketing budget. The Internet and travel shopper buying process is far too complex, and your competitors are far too aggressive to put online marketing on the back burner.
September 05, 2011 | © Hotel Marketing
