How To Use Your Hotel Data to Drive Growth (Travel Tuesday)

As you put together your hotel marketing and business plans for 2015, here are a couple of questions to keep in mind: What’s a guest really worth to you? And how much do search, metasearch, mobile, social, OTA’s, TripAdvisor, and all the other digital and traditional travel marketing tactics contribute to that total? What’s really driving your guests to find and book your hotels?

As you think about that, here’s one more question: Do you really think the OTA’s can’t answer these questions?

OTA’s don’t just outspend hotels on marketing because they have more to spend — though that’s unquestionably true. They also spend smarter. Most major online travel agencies have invested heavily in recent years building strong “data sciences” teams, statisticians and database wizards well-equipped to unravel the tangled web of modern marketing. Those investments have paid off, helping OTA’s achieve a dominant role in travel marketing, and resulting in higher distribution costs for hotels.

While Big Data has been, to this point, more hype and hope than help for most hotel marketers, the fact remains that your ability to compete effectively with OTA’s — and with the other hotels in your market — depends on gaining a deeper understanding of your guests. And gaining that deeper understanding depends on having and using the right data to drive your marketing decisions.

Even though it’s unlikely you’ll be able to compete head-to-head with the OTA’s from a technology and data sciences perspective, you can use the data you do have to improve your guests’ experiences before, during, and after their stays. And improving guest experience remains the one key area where hotel operators can always outperform the competition, whether from online travel agents, fellow hoteliers, or new entrants like Airbnb. Few things reinforce your brand value proposition as much as your guest’s overall experience when dealing with your hotel. The data you have available to you provides you a strategic differentiator – your competitors simply don’t know everything you do about the guests who research, book, and stay with you. Why not use that to your advantage?

Start small

For all the promises of “big data,” sometimes just knowing more than you do today represents a huge step in the right direction. How many times has your office curmudgeon (not that your company has one of those), stated “There’s no possible way we could know that” when assessing the impact of your marketing or promotions on “intangibles” such as voice reservations, walk-ins, or guest loyalty? When the alternative is “no possible way to know,” any information is literally infinitely better than where you’re starting from. Which would you rather have: No insight at all into your guests’ wants, needs, and desires? Or even a little bit of insight? Each improvement, no matter how incremental, positions you more effectively against your competition, and positions you for greater success down the road.

One best practice that’s emerged from digital marketing is the use of a “test and learn” approach, where savvy marketers analyze the data from each new initiative to figure out what’s working, then continue to “fish where the fishing’s good,” building on successes, and learning from less successful efforts. Apply a similar approach to building your measurements and increase investments on those efforts demonstrating positive results.

Focus your team and your talents

In most businesses, culture trumps strategy. “The way we’ve always done things” creates a powerful barrier to change, no matter how necessary. If you’ve long relied on anecdotes and opinions to shape your marketing strategy, it’s time to supplement your (usually quite valuable) implicit knowledge with some cold, hard facts. Don’t just look at “ROI” for your marketing initiatives; evaluate the number of profitable guests each produces, and the lifetime value of customers gained from each of your channels.

Assign someone within your marketing, distribution, or e-commerce group to coordinate your team’s efforts and align data collection, analysis, and reporting best practices and lessons learned across your organization. And make sure they have support among your executive team, too. Focus on long-term opportunities, while helping your team find short-term wins to apply better business intelligence in marketing, revenue management, and operations. Use technology to streamline and automate your analytics process; but, even more importantly, train your team members in how to apply the learnings new metrics and measures reveal. A big stack of reports piling up in your marketing team’s inboxes because no one knows how to interpret and act on the results represents wasted effort, and wasted opportunity.

Protect the “crown jewels”

It’s almost cliche to say that “content is king” when it comes to digital. It’s also true. And in a world where mobile plays a huge role defining your guests’ experience, the context in which your guests enjoy that content is “queen.” If content is king and context is queen, data represents the “crown jewels” of your kingdom. And just like any valuable treasure, that data demands protection. Assign someone from your technology team to ensure you’re following appropriate best practices for data protection. As we’ve seen recently with retailers such as Home Depot and Target, privacy matters. Ultimately, any data about your guests belongs to the guest, not to you. Protect their private information as though your business depends on it. Because it does.

I’ve said before that OTA’s aren’t evil; they’re just doing their jobs. When used properly, they remain a key component of your overall distribution strategy. That doesn’t mean you should just outsource your entire hotel to them. You have the information you need to find, attract, and convert the guests you want available to you, as long as you invest the time and effort to make that information work for you. It’s time you get that information to do its job, too.

Tim Peter helps companies put the Web to work to grow their business. Since 1995, he has developed innovative e-commerce and digital marketing programs across multiple industries. An expert in e-commerce and digital marketing strategy, Tim focuses on the growth of the social, local, mobile web and its impact on both consumer behavior and business results.