Abracadabra, there is a budget for your hotel marketing

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When it comes to hotel marketing, as for any marketing budget, you need a goal. Marketing is all about how much you will earn, not about how much you will spend.

You have an online marketing budget, even if you don’t think you do. The commissions you pay to OTAs are indirect marketing. What they spend in their visibility to provide your bookings, they make you repay in commissions, plus their margin.

When you look at the OTA commissions line of your P&L, there you have your online marketing budget for the year. Pretty big for a marketing budget, right?

This leads to your marketing goal: spend this money for a better purpose. Selling your rooms through your own website is a higher purpose.

First, that money is spent entirely on your brand, not for some hotel aggregator’s brand.

Second, this is money you won’t have to spend every year for each client. When your clients book on your website, you build loyalty. These clients know you personally, you have their e-mail address.

You can communicate with them, offer promotions to them, you can… well, market your hotel to them.

Now some maths.

fastbooking[1]

You sell your rooms at EURO 100 average daily rate via OTAs.

Let your objective be to switch 10 of those rooms from OTAs to your own website this year.

With an average commission rate on OTAs of 20% and an average commission of your website booking engine of 4%, you will save 16% of your room price.

That’s Euro 16/room/day.

To make sure clients will book on your website, make it one Euro less expensive, that’s all it takes.

Euro 15 x 10 rooms x 365 days of the year. Your marketing budget this year is roughly Euro 55,000.

How hard can it be to spend that much money?

First, invest Euro 10,000 every year on a highly converting, highly convincing website for your hotel. For example a new Euro 30,000 website every three years. That’s including media production (content photos, videos) and updates.

Then, you need to bring traffic – Euro 30,000 a year seems right to reach your objective of switching 10 rooms from OTAs. Split it in two: half for search engine advertising, and half on metasearch websites such as Tripadvisor.

Euro 30,000 to buy 3650 room nights brings it down to Euro 8,2 per room night acquired, a very reachable ROI through adwords and metasearch.

OTAs get many bookings through their link on your Tripadvisor page. How simple is it to have them book on your website instead? As simple as one Euro per room.

And if you’re afraid this won’t work and you could lose all your money, find a booking engine/hotel marketing provider that will be happy to invest that money for you.

But you have spent only Euro 40,000 out of the Euro 55,000 of your budget. Reinvest Euro 10,000 in your hotel, or send them to your happy investor.

And with the remaining Euro 5,000? Take your family on a holiday trip. And make sure you book it on the hotel’s website 😉

Published on: July 14, 2014
Author:
FASTBOOKING’s e-commerce solutions will help your hotel increase profit through a direct sales strategy.

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