Category Archives: Hotels

Vacation Rentals: A Growing Travel Market

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The vacation rental industry has experienced tremendous growth for more than a decade – nearly doubling in size from 1999-2011 (98%), and that trajectory should continue if recent travel trends offer any insight into the future.

Current travelers are planning their trips further in advance, staying longer during these trips and often making those trip in larger groups (despite the transient segment still leading the way in travel growth).  Let’s take a look at how each of these factors influences the vacation rental industry.

Planning Ahead of Time

Why is it important to vacation rental managers that travelers are now planning trips ahead of time (35% of travelers surveyed by Sojern booked their vacations more than 30-days in advance during Q3 2013)?

A rushed traveler booking at the last minute will typically choose more traditional accommodation options including hotels and motels.  However, travelers with more time to plan tend to be more creative, no doubt contributing to the ever-increasing trend of Americans who stay in vacation rentals each year.

Longer Stays

Sojern’s data also revealed that over 60% of leisure travelers searched for vacation stays of six days or longer in the third quarter of 2013.  The economics of vacation rentals, and their superior convenience with all the amenities of home, become more pronounced during a longer stay.

This trend was not limited to the leisure travel market.  Business travelers stayed at their destination for six days or longer 40% of the time, signaling that business travelers may be attracted to many of the same benefits vacation rentals provide.

Larger Groups

Large group travel trends tend to fluctuate depending on seasonal travel patterns, but in general hotels simply cannot compete when it comes to the convenience offered by vacation rentals for large groups.  The ability to keep an entire family under the same roof, especially groups with young children, without the headache and hassle of room roulette.

Vacation Rental Industry Growth

A recent PhoCusWright report shows that vacation rental revenue totals nearly $55 billion.  Market penetration is estimated at only 4-6% leaving ample room for growth within the industry.  Here are some other intriguing numbers that will make vacation rental owners and managers happy:

-From 2007 to 2012, the percentage of vacation rentals booked online increased from 12% to 24%.

-By 2014, it is projected that 3 out of every 10 U.S. dollars spent on vacation rentals will be booked online.

-Vacation rental management companies are quickly moving toward online listings.  In 2008, less than half of VRMCs offered live online booking.  That number has increased to 70% since that time and is still growing.

Report: Transient Channel Leads Hotel Growth in Q1 2014

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According to a recent TravelClick report, the North American hotel sector started the first month of 2014 with moderate increases in room rates and bookings.  The transient segment (individual business and leisure travelers) was the group leading the way in occupancy growth.

“After strong group sales pace early in the fourth quarter of last year, it is a bit disappointing that group bookings have lost some steam heading into the New Year,” said Tim Hart, executive vice president of business intelligence at TravelClick.  “That being said, the group segment is still ahead of where it was this time last year, and strong transient demand and ADR growth continues to drive a positive overall outlook for the first part of 2014.”

Here are highlights of some of the key numbers and statistics presented in the report:

-Transient bookings are up 5.3 percent year-over-year and the Average Daily Rate (ADR) for this segment is up 5.2 percent.

-When examining the 12-month outlook more closely (January 2014 – December 2014), it shows overall committed occupancy has increased by 3.3% compared to the same time last year.  This is also an increase of one percent from TravelClick’s July 2013 survey measuring the same information.

-The 12-month outlook also shows that ADR are up 3.9 percent based on reservations currently on the books.

The read the TravelClick report in its entirety, click here.

Push Mobile Marketing – What You Need to Know

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Are you getting the most out of your marketing campaign?  Do you have a portion of your marketing budget dedicated to mobile marketing?  Is it making a difference or are there improvements you could make to increase your ROI?

A recent Marketing Land column takes a closer look at the difference between push and pull mobile techniques, and how push mobile marketing may be the answer in connecting with guests both on- and off-site.

Defining Pull Mobile Techniques

When customers or consumers are proactively trying to attain the goods or information they need, this refers to a pull mobile technique.  Accessing a responsive mobile website or mobile application allows a traveler to compare availability and rates, but this is not the only way they can acquire this information.

Effective Push Mobile Marketing Techniques

If pull mobile techniques involve a user-driven model, than it makes sense that push mobile techniques originate on the business side of things.  It is important for companies to develop a conversation with consumers, hopefully allowing this to blossom into full-blown brand loyalty.

Mobile applications are a great way to send push notifications to travelers who have already downloaded your app, and getting users to download your app successfully is the first step.   App alerts are a great way for brands to inform consumers of any new app updates or features, as well as notifying users of promotions or other activities.

One thing to keep in mind with app alerts is that all push notifications can be turned off.  Consumers with dozens of apps on their smartphones tend to avoid being inundated with annoying alerts by disabling one or two push notifications.  Depending on the smartphone, push notifications could be disabled as a default setting.  Unless consumers are enabling this feature on their own, your message may not reach them.

Another way to reach consumers is the use of mobile messaging.  Here are three keys to building the right mobile message for your brand:

-Decide whether your message requires a short message service (SMS) involving just text or a rich message service (RMS), which also includes some type of media (photo, videos, etc.) as well.

-Make sure your message is timely (90% of text messages are read within three minutes of delivery)

-Include a strong call to action.  If you are offering a deal or promotion, include a deadline to increase the urgency of the consumer.

Regardless of what type of push mobile marketing your business is using, the key to its effectiveness will be a continued development of a more personal relationship with potential buyers.  This will help to increase brand loyalty, and should result in future business down the road.

Amplify Your Hotel Story on Instagram

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One of the most rapidly growing social media channels, Instagram, is taking advantage of the idea behind this famous Walt Disney quote:

“Of all our inventions for mass communication, pictures still speak the most universally understood language.”

Taylor Short, who reviews hotel management products for Software Advice, was interviewed by the Leonardo travel blog and gave some insight into how hotels can use Instagram to amplify their story online.  After all, storytelling is one of the oldest forms of human communication.

Why the popularity surge?  Why should hotels care?

Short discusses Instagram’s appeal in its strictly visual nature.  People love taking pictures, and smartphone cameras make the process quite simple to accomplish.  Recent improvements in technology have enhanced the quality of the cameras in these phones.  Because of this, a platform based on photo sharing is, by looking at Instagram’s 75 million daily users, a platform people want to use.

Hoteliers have the opportunity to reach millions of potential guests by frequently posting quality content and engaging users with strategic campaigns that call for participation.

How to maximize your Instagram impact

There are three keys to creating an Instagram post that will attract potential travelers:

1) Be Creative

2) Be Genuine

3) Post Frequently

Engaging other users and gaining followers will help grow a hotel’s presence on the platform.  Make your communication authentic and avoid communication that constantly feels like a hard sell.

Instagram vs. other social media channels

Short explains that each platform should be viewed as an individual opportunity to tell your hotel’s story.  Facebook is a great tool for gathering guest feedback, while Twitter may work well as a customer service platform.  Instagram allow you to show off a visual story and the aesthetic appeal of your property.

To read this interview in its entirety, click here.

To learn more about creating your own Instagram account, head to the Instagram Help Center.

Bidroom Utilizing Reverse Auction Model

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Auctions are a great place to find amazing values on goods or an object being sold to the highest bidder, but what happens when this model transitions into the hospitality and travel industries?  A new hotel booking site, Bidroom, is attempting to re-create the current Online Travel Agency (OTA) model by introducing the reverse auction model.

You may be asking yourself, what is a reverse auction model?  Well, instead of a group of travelers bidding on a vacation accommodation, these individuals are asked to fill out the basic details of their stay (arrival/departure dates, number of rooms required, etc.).  This information is passed along to local hotels in real time, inviting them to provide their best offer, essentially bidding against other properties for a customer.

A 24-hour countdown clock helps both the traveler and hotel stay focused on making a deal.  Typically, these prices are lower than those offered by big booking sites and hotels are receiving direct bookings in the process without a commission charge.

As if the bidding process were not innovative enough, Bidroom is attempting to wipe the slate clean by being the first to offer this model to travelers FREE-OF-CHARGE.

Free Service

How can the company expect to make any money it the service is free?  Co-founder Mark Bradshaw explained that because Bidroom is a platform, rather than a typical travel or booking agency, the running costs are much lower than those of a traditional OTA.

In the future, Bradshaw hopes to consider following the lead services like Gmail, Skype or Facebook, whereby small advertisements run alongside the content or the webpages.  Ultimately, he expects to keep the core service free of charge.

Why the New Business Model?

Over the past decade, the presence of OTAs has grown considerably.  Many hoteliers recognize their marketing benefits and find them to be a great way to fill rooms.  However, high commission rates and a lack of loyalty from direct bookings make it a challenge to compete in such a busy online marketplace.

Bradshaw believes that if hotel prices through Bidroom are 10% cheaper than a traditional OTA, both customers and hotels will be better off, and his independent platform will grow.

Discussing Hotel Distribution Strategies

parityrate 1 click logoIn a recent interview with EyeForTravel, Sascha Hausmann, CEO of Busy Rooms, discussed hotel distribution developments in 2013, as well as trends to monitor in 2014.  Here are some of the key points Hausmann covered in her examination of distribution strategies.

Major Developments in 2013

Alternative distribution, outside of the regular and traditional OTA business, was a hot button issue last year.  It is clear that travelers like the ability to compare products.  This is where metasearch engines have made great strides.  Allowing travelers to not only compare properties in a given location, but to find the best price from a range of OTAs has given metasearch channels a leg up on the competition.

Major Trends to Keep an Eye on in 2014

1) Continuous growth in mobile and a shift from web-based searching and booking to mobile web-based

2) A focus on direct distribution fostered by metasearch

3) Rate parity will become a tool used by hoteliers rather than forced by OTA/tour operators

How to Optimize Your Effectiveness

In recent years, the focus for most hotels has been which mix of OTAs will provide the most visibility for your property.  However, with the advent of metasearch engines and the growth of online advertising options, the right mix of OTAs is no longer enough.  Travelers do not easily group themselves around specific channels anymore, instead using a broad range of outlets.

The Role of Channel Management

The channel management industry came into existence to solve that problem of managing a variety of different outlets, both in terms of availability and pricing.  However, these channels have not progressed from being just another online travel agency management tool.

Hausmann predicts that the next generation of channel management will be able to go far beyond just managing the online booking sector, but will also allow for centralizing online marketing opportunities and direct consumer traffic while providing detailed performance metrics and market intelligence.

To read this EyeForTravel interview in its entirety, and to learn more about distribution strategies, click here.

Is Social Media the Best Customer Service Tool?

socialMediaCustomerService_v1.1In December, we talked about the natural merger of the on-site hotel concierge and social media manager.  Patrick Mayock of HotelNewsNow took this idea a bit further and examined whether social media is the best client service tool.

At the Fitur International Tourism Trade Fair in Spain, Mayock sat in on a presentation about social media as the ultimate customer service channel.  However, he has some reservations about that designation.

It is obvious that social media has become a key tool in managing a customer’s online requests.  An eDigitalResearch survey found that more than one in 10 respondents expected to be able to speak to a brand represented via social media.

A similar report by the Aberdeen Group, conducted in 2012, found that 12% of service requests originated in the social sphere, with that number projected to have risen to 22% in 2013.

Companies have dedicated additional resources to marketing and social media subsets, and in general have seen success in this area.  Contact through social media is the quickest and most reliable way to get in contact with a brand and currently the only channel that will guarantee a reply to your query or complaint.

Companies may be responding to these questions due to fear of publicized customer rants on Facebook or Twitter, a common trend among the seemingly “Silent Travelers” who may smile about customer service on-site, but unleash when they have the right social media platform.

Mayock’s belief is that social media may not be supporting the increasingly digital customer service exchange, but rather the proliferation of handheld devices.  Because of the rise in these devices, hoteliers are creating new applications to reach guests – both on and off property.

The nature of these apps varies from company to company, but the consistent idea is allowing hoteliers to stay connected with guests, and vice versa.  The most important aspect of the conversation is that these companies are circumventing social media entirely.

To read more about Mayock’s travel industry insights, and to the read rest of this article, click here.

Examining Metasearch Online Travel Agencies

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Online travel agencies (OTAs) are a vital part of the supply chain in the travel industry. They are widely considered one of the main factors behind rapid growth in online travel bookings across both mature and emerging markets.

New online channels have been created in recent years with the intention of lowering hotel distribution costs without decreasing occupancy levels.  Of these options, the metasearch channel has separated itself from the pack as a highly successful venture.

In a recent interview with HotelMarketing.com, Siteminder’s CEO Mike Ford illustrated the opportunities that metasearch channels present for hoteliers.

Ford begins the discussion by explaining that metasearch OTAs collect room rates from multiple online channels and displays them to the consumer in a single list.  This allows potential travelers an expedited process to find and compare hotels and pricing options.  Some of the most popular sites include Google Hotel Finder, Trivago and Kayak.

Those hoteliers that are taking advantage and becoming early adopters of new sales and distribution technologies stand out, but ultimately the name of the game is converting clicks to bookings.  No matter the type of property, the number of rooms, geographical location, star rating or amenities offered, the companies that are the most profitable will be those with a high click conversion.

Ford also discusses his feelings about TripAdvisor’s TripConnect in comparison to the other major metasearch OTAs as well as tips for hoteliers on how best to implement metasearch channels into their online visibility.

To read this entire interview, and to learn more about the importance of metasearch OTAs going forward, click here.