A natural partnership: Tourism & online marketing
For enterprises operating in the tourism and hospitality industries, gaining an understanding of the expectations and practices of consumers wanting to use the Internet as a medium to seek information and arrange online travel bookings is absolutely vital.
Tuning in to the online traffic about customer satisfaction with services is a key to addressing quality issues and responding swiftly and deftly to consumer perceptions and needs. ‘When we upgraded our website, we only thought about having a nicer online brochure than the one we had before,’ recollects Karim Bouayad, manager of the Hotel Amine in Marrakech. Mr. Bouayad was a participant in an ITC e-booking training programme and a beneficiary of an ITC web marketing analysis programme that took place in Morocco in the framework of the Enhancing Arab Capacity for Trade (EnACT) programme. ‘But after a few weeks, we saw a sharp increase in inquiries flocking in and, even better, direct bookings through our online booking engine’. An effective mix of design, professional pictures, well thought through navigation and content, and a powerful yet affordable booking engine were key to their success.
EnACT is an ITC technical assistance facility funded in large part by the Canadian International Development Agency. EnACT capitalizes on the long-term partnership and trade development expertise of ITC to develop the full export potential of Algeria, Egypt, Jordan, Morocco and Tunisia.
The case of Hotel Amine is not isolated. In 2008, hotel groups like Marriott saw a staggering 70% of overall bookings taking place directly through their online portals. But it is only recently that small- and medium-sized hotels have been able to fully benefit from the web to increase visibility and sales while reducing marketing costs. Many of them, however, still do not leverage this potential effectively, especially in developing countries.
This comes as a surprise as it is probably in the travel and hospitality industry that the Internet has brought the most dramatic changes. The Global Trends in Online Shopping report released by Nielsen, a global information and measurement company, in June 2010 shows that one out of four Internet users worldwide intended to book tours and hotels online. Most of them already had in the recent past. Although there are still geographic differences, the trend is bullish across the board. Some countries are leading the way: GfK, another large market research company, observed similar trends in the German market and anticipates that by 2015 more than 40% of hotel reservations will be made online by consumers. In addition, 30% of bookings will be made in a traditional agency after an online search. Hence, GfK reckoned the Internet would play a primary role for more than 70% of all bookings.
Indeed, according to a study by PricewaterhouseCoopers, for 65% of European Internet users the web is a primary source of information to prepare their travel. Young Russians planning a ski trip to the resorts of Central Asia’s Tian Shan range will go online first, as does the Malaysian business man preparing a trip to Bangladesh to meet his partners. Whether for leisure or for professional purposes, travellers seek information online first; hence the necessity to be present on the web, with a website or through a partnership with brokers such as www.booking.com.
In this context, social media, which encompass sites like Facebook and Twitter, but also more specialized ones like TripAdvisor, are becoming a major source of information to validate choices made by customers. Social media accounts for 78% of traffic to travel websites according to the recent L2 Digital IQ Index for Travel report. Social media sites can be accessed from anywhere in the world and web users report their experience with a particular hotel – from their laptop and increasingly through their smartphone.
‘Hotel owners who are not actively participating in the conversation about their place can lose out on a fair amount of extra business,’ says Daniel Ebneter, a Swiss Social Media expert. ‘Even worse, they are taking the risk of ignoring a serious threat to their business if unsatisified customers or ruthless competitors start a smear campaign against them.’
For small- and medium-sized hotels in least developed economies, engaging in social media might seem premature if they use their local market as a reference point. It is not. Especially with export-oriented hotels, which rely on foreign clients, it is much more important to understand consumer habits abroad. ‘Innovation is continuous,’ notes Mr. Ebneter. ‘Think augmented reality: tomorrow, your customers will point their mobile at your hotel and get real-time information about it, like peer reviews, ratings and immediately available special deals.’
So what should a manager of a small- and medium-sized hotel with few resources do to jump on the bandwagon? Claim ownership of your profile on popular sites like TripAdvisor and actively manage it, even if you do not yet have a website. Hotel Royal in Algiers, for instance, has a great view of the sea, but for travellers to the Algerian capital who look for options online, it does not exist as it has no web presence. With a profile on TripAdvisor, and by encouraging visitors to review the site during or after their visit, the hotel will gain a digital existence. It is essential to create this basic visibility.
Creating a simple website with Tumblr or Posterous is the next obvious step. These sites offer free, simple-to-use tools to create content. You can also create a Facebook company page. The largest social network in the world already counts more than 700 million followers and is fast outpacing Google in terms of web traffic and time spent. Twitter, the micro-blogging platform, also offers no-cost opportunities to establish links with new clients. Success is not immediate, but it is worth giving it a try, which is what the Hotel Alma Ata in Almaty, Kazakhstan, is doing: www.twitter.com/#!/hotel_almaty. They are following the inspiring example of hotels like the Casa400 in Amsterdam, www.twitter.com/#!/hotelcasa400, which has managed to create a community of followers. No large investment is required, just a little time and a good deal of creativity. ITC’s Enterprise Competitiveness section offers a two day course on the subject with more examples and hands-on web marketing skills development.
The Internet is becoming the most important distribution channel for the hospitality industry. No small- and medium-sized hotel manager can afford to ignore this development. A professional website, advanced reservation features and the best use of all channels to the customer (global distribution systems, online agencies, comparison sites, social networks) will be needed in the future.