Travel is roaring back and occupancy rates are surging for hotels across the country.
NB: This is an article from Pegasus
Memorial Day Weekend was a “blockbuster” according to Hilton CEO Christopher Nassetta, with nationwide occupancy for Hilton properties hitting 93%. Hilton is now projecting this summer’s booking volume to exceed 2019 levels, and many vacation destinations are already experiencing sell-out pressure through Labor Day and beyond. Travel professionals who have watched with cautious optimism as vaccines rolled out are starting to see real, tangible revenue and bookings materialize. Business really is back.
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After weathering a brutal 2020, the industry is eager to take full advantage of this summer’s demand. Revenue leaders who spent the past 15 months hungry for any kind of occupancy will again start to be strategic about rate, throttling their various channels and yielding their last inventory at BAR. While success in 2020 meant filling enough rooms to cover operating costs and keep the lights on, success in 2021 will again be measured in RevPAR against the comp set. Hotels are competing with one another again instead of with the pandemic. The return to this kind of normalcy is a very welcome one.
As recovery has picked up, particular interest has been paid industry-wide to the direct channel, which has been more resilient and bounced back more quickly than third party channels. Travelers are visiting and booking at brand.com in higher proportion than they had pre-pandemic, trusting the hotel itself over third parties for reservation flexibility and up-to-date information about local Covid-19 regulations. These new guest priorities represent an opportunity for savvy hotels to regain control of the guest relationship.
A recent blog post from Pegasus CEO Gautam Lulla emphasized the importance of agile, integrated technology to take advantage of this summer’s volatile environment. The ability to quickly and effectively update brand.com is business-critical – availability of amenities, F&B, and neighborhood attractions will be updating regularly, and providing incorrect information to a guest this summer is the surest way to lose their trust. Marketers must work with operations teams to be sure information is accurate and clearly structured.
But in addition to ensuring their websites have the correct site-wide informational updates, the traffic surge to brand.com and the rush to recover revenue as quickly as possible is making tech-forward hotel marketers dip their toes back into the long-promised but rarely-realized world of personalization.
Personalization has long been a buzzword in hospitality, but it’s always been fuzzily defined. Hoteliers agree that personalization involves using tech and data to drive tailored guest experiences, so that people are treated differently according to their preferences. Beyond that, it’s difficult to get a concrete definition of personalization nailed down.
Part of the fuzziness comes from who often defines the term: vendors. Vendors promoting the idea of personalization range from industry-specific niche startups to massive publicly-traded companies with clients across multiple verticals. Some vendors discuss personalization in the context of e-commerce, promising higher website conversion rates; some discuss it in the context of service, with products that store guest preferences and help operations staff anticipate needs. Some vendors integrate data from social media, or append purchase and demographic data from third parties. All of these different companies use the same catch-all term of personalization to describe what they do.
As noted above, the industry agrees that actionable data is at the core of all personalization strategies. Below we’ll attempt to clear some of the ambiguity around hotel personalization by defining the different tiers of data that hotels have access to at various stages of a guest’s booking cycle, and some insights into how that data can be used.
The below is not exhaustive, but should provide a guide to how different kinds of hotels can work with vendors to drive tailored digital experiences:
The instant a visitor makes their first site entry at brand.com, marketers have access to a variety of high-level data points. These include details like the visitor’s device type, their location according to IP address, and their preferred language according to their browser settings. For some visits, the specific source of the traffic can also be seen – whether the visitor came from a google search, or a PR article about the hotel restaurant, or a paid referral link.
Entry data is anonymous, but it provides contextual clues about the kind of information a visitor is looking for. Smart marketers make use of these clues to prioritize relevant information and drive higher engagement.
For example, tailoring your website’s welcome messaging to a visitor’s browser language reduces bounce rates even if the only dynamic word is “Welcome” and the rest of the messaging remains in English. Another example of using entry data is prioritizing a Free Parking promotion for visitors whose IP addresses indicate they’re within a drive radius of the hotel. Given the growth of the Voice channel, some high-touch hotels have begun using entry data to add automatic Click-to-Call icons for web visitors using mobile devices.
Entry data helps marketers segment their traffic and improve the relevance of the first information they show to each visitor. You should work with your website provider and/or marketing agency to discuss the opportunities for using entry data. (It helps if these are the same organization!)
As a visitor starts engaging with your website during a given session, they produce behavioral data that digital marketers have access to. Behavioral data includes information like the length of time a user is on site, the kind of content or offers they’re looking at, their path through the website, their scroll depth for a given page, and more.
One simple way that hotel marketers use this data is to help determine the kinds of packages and promotions they surface. For example, it makes sense to serve higher-priced lifestyle and value-add promotions to traffic that has viewed upgraded inventory – these are people who have indicated they’re looking for a luxury experience, and serving them discounts could result in eroding rate.
Behavioral data is especially useful for resort properties with many diverse amenities and large websites. A resort with a golf course, beachfront amenities, a spa, and wildlife tours can gain serious insights about which packages will convert a visitor by seeing the parts of your website they have visited.
Marketers interested in making use of website behavioral data should begin conversations with their website provider and booking engine – tying in both parts of your infrastructure is important. (Again, when it comes to surfacing dynamic attributes during browsing and booking, it’s nice to have a single tech provider for both of these business units!)
Multi-Session or Purchasing Cycle Data
More sophisticated marketers will use technology (primarily first-party cookies) to tie multiple browsing sessions together. In this case, the visitor is still anonymous but their behavioral data follows them across multiple visits in their purchasing cycle.
The idea of using data across multiple sessions should make sense to all hotel marketers – it’s long been common industry knowledge that travel shoppers visit many, many different websites before making a purchasing decision. At one point Expedia estimated that the average person visited 38 sites before finalizing a trip.
Multi-session data can be used to tailor content and reduce the number of clicks needed for traffic to convert. For example, marketers can store the dates and room types (or package details, or anything else) that a visitor has searched in past sessions, and then automatically pre-populate those search parameters on the home page during subsequent visits.
In an environment where consumers can purchase the same product in multiple places and channels, lowering click-to-convert ratios makes a difference in conversion rate. Talking with your website and booking engine providers will help you explore your options for using multi-session and purchasing cycle data.
At this point, we are reaching a level of sophistication achieved by only the most tech-forward hotel companies in the world. In this case, guests log in to a centralized portal across all of their various devices when they interact with the brand, allowing the hotel to recognize the guest not just as an anonymous device, but as a specific person. A login powers the experience most people envision when they talk about digital personalization: welcoming a visitor to a website using their real name, and using their history with your brand to tailor the content you show them and the packages you prompt them to buy.
Rather than manage the login technology themselves, and all of the PII-related complications and challenges associated with it, many hotels now use 3rd party-facilitated products from Google, Facebook, or Apple to power the login and recognition component of their programs. Using one of these companies’ portals not only outsources the most delicate parts of data management to a trusted brand, but it allows the guest to use an existing password to connect with your hotel rather than managing a new one.
Once recognition is achieved, there are substantial opportunities to unify the various data sets in a hotel’s back end, from the PMS, to the CRS, the website, and the booking engine. Often a powerful CRM can be the nexus of this information.
Executing on this kind of personalization requires an investment of resources and time — these are complex, long-term strategies. But permission to recognize the guest is always the starting point, and ambitious brands are spending 2021 deepening this part of their personalization capabilities.
Each hotel must determine for themselves what level of personalization is right for their org going forward. Every tier of data mentioned above can provide businesses with a boost, but each must be scoped, managed carefully, and followed through on. And while vendors have created some of the ambiguity around the term personalization, it is also partnerships with trusted vendors that will help savvy marketers succeed.
Business is back and the direct channel is thriving. Next time your hotel considers an investment in personalization, it is worth first considering the kind of data you have access to and how you’d like to use it.