Euromonitor International is pleased to present an interview examining on-line distribution for hotels. Euromonitor International Travel and Tourism Research Manager Michelle Grant spoke with Vikram Singh, Co-Founder of Evision Worldwide (2006) and Madbooker (2013). Both companies were established to improve ecommerce for hospitality businesses.
What is your background?
After graduating from hotel school, I started my career in hospitality with the Taj Group of Hotels, Resorts & Palaces, and then moved to Pan Pacific Hotels & Resorts in San Francisco. These experiences gave me the chance to cover every possible department in a hotel and truly understand how hotels operate.
My career in hospitality veered toward technology while I was in San Francisco. I decided to move into online revenue, distribution and optimization technology services. I took a deep dive and instantly loved it. Working with and developing clients from San Francisco to NYC, London to Tokyo, was simply exhilarating!
In 2006, I co- founded Evision (www.evisionworldwide.com), which continues to provide high-level strategy to private equity and hotel companies. We have worked with some of the top real estate investment trusts and investors worldwide, on asset deals worth well over $1 billion. Our comprehensive strategies have helped clients achieve tremendous success with their new acquisitions, existing assets, and hotel rebranding efforts.
In 2013, my partners and I started our newest venture: Madbooker (www.madbooker.com) – It offers the most streamlined and productive reservation system in the travel and lodging industry. It is built to excel on all devices and harnesses open source power at a great price point for hotels, bed and breakfasts and vacation rentals. Madbooker customers can also take advantage of our team’s extensive online marketing experience via affordable monthly packages.
How should hotels approach the development of a rate and distribution strategy?
Guests are booking their accommodations quite differently than they were just 5 or 10 years ago. The hotel industry needs to change their approach as well. Many of the current rate and distribution strategies rely on historic data and focus on price trends. I think it’s time to focus on value, rather than obsessing over your rate and what your competition is doing. Creating a value proposition needs to be Step 1 before embarking on any kind of detailed rate and distribution strategy.
How is online marketing evolving, both search engine marketing and social media marketing?
I do not like the concept of “social media marketing.” I think hotels should be doing more “social media conversing,” where they use social media to communicate with their guests: listen and respond, not just push out offers. Paying an agency to handle social media communication is a big misstep that a lot of hotels make. The voice has to be authentic and original, and not the mass-produced noise that we are often seeing these days.
Search engine marketing is getting much more targeted as Google is now using its massive online powers to:
- Make the process of searching for travel more efficient, and
- Ensure that they continue to make money from click- and impression-based advertising.
Specifically, the concept of ranking for high-volume keywords using search engine optimization is no longer a feasible inbound marketing tactic. Creating quality content to provide answers and build your brand based on value (not hyperbole) needs to be the core focus for any lodging business.
The final step is to make sure you set aside enough budget to spend on Google to harvest all of your brand name searches. In other words, when I look for your hotel by name, I should see your enticing ad right on top of the page. Otherwise, Priceline, Booking.com and Expedia will have their pay per click ads ready to harvest that sale for you.
What should hotels be doing to have an effective online marketing strategy?
Every hotel needs to decide what their value proposition is going to be. They need to build a story around their location and value. The focus needs to move from marketing platforms like Facebook and Google Plus toward compelling location marketing and storytelling.
It’s amazing how little local information many hotel websites provide to a prospective visitor. Design-heavy, content-light websites are wreaking havoc on direct conversions. Google will be glad to answer questions about any location in the world; don’t be surprised when they also sell the room, tours and activities because you were too busy yelling “Book Now!” on your website rather than answer your guest’s questions.
How do you view the role of on-line travel agencies in online distribution and marketing?
I respect the OTA’s and admire what they have achieved in a relatively small amount of time. They dominated search engines in what I like to refer to as the “golden age of search engine optimization” by launching hundreds of content-rich affiliate websites. Around the same time, the big hotel brands were serving notices to owners to shut down their local independent websites – a grave error.
OTA’s also have heavily spent where it really mattered – Google AdWords. By buying keywords in every stage of the travel search and booking funnel, they ensured that they would not only build trust, but also made it very easy to buy a room from them.
I think every hotel should aspire to run their online marketing program like an OTA, with the determination to get the click and the booking.
Does online marketing level the playing field for all accommodation players or do the brands still have an advantage thanks to their resources?
Internet is the great equalizer. Over the past few years, it has helped some amazing new concepts in hospitality surpass everyone’s expectations (eg, Airbnb, Hotel Tonight).
The big hotel brands definitely have the resources, but I see them focusing on the wrong things. They are just building their brand, and not working to improve the travel search and buying cycle. They are buying online marketing and strategy like they buy toiletries. However, unlike soap distributors, one marketing agency cannot power the strategy for 1000+ hotels in different locations across the world. This is the biggest challenge, I think. There is no urgent danger to brands but… to quote PB Shelly, “nothing wilts faster than laurels that have been rested upon.”
How important is in your view Google for hotels and in which way? What do you think will be its role in the future?
Google has always been a travel powerhouse and is not going to let go of its #1 spot.
Their recent updates have ensured that:
- Hotels that are building their brand get rewarded, and
- Anyone trying to game the system for a few extra clicks gets penalized.
There has never been a better time than now to produce location-based content on your hotel website. Even though the overall volume of referral traffic that hotels get is gradually declining, Google AdWords is still very relevant, and every hotel needs to participate in that program. Especially when it comes to brand name keywords. You must buy your brand name keywords or the OTA’s will be happy to do it for you, and get your clicks and your bookings.
As for the future, I think Google is looking for revenue streams beyond its one-trick pony (pay per click) in the world of travel. Products like Hotel Finder are an indication of things to come.
What are the prospects of the mobile channel for the hotel industry for bookings and as a customer service tool?
All commerce is mobile commerce. I have been talking about mobile marketing since 2010 at hotel conference and events. It’s amazing to see every projection about popularity, usage and growth hold true. Unfortunately, as with everything else, hotel marketing agencies have used “mobile marketing” and “mobile website” as buzzwords to sell products and services. They haven’t truly embraced mobile as a fundamental part of the overall marketing strategy.
There is a lot of improvement that needs to be done. One of the biggest reasons we launched Madbooker was to update the mobile commerce experience for guests and hoteliers. Our system breaks down all stats by device right on the dashboard, and works great on all devices whether you’re using the front or back end.
Nothing beats a mobile device when it comes to giving on-the-spot customer service. Every hotel must get comfortable with the fact that guests are using phones and iPads to search, book, and communicate. To keep up with Google and the OTA’s, make sure you’re reaching today’s and tomorrow’s guests where it matters – on their phones.