This article originally appeared on Tambourine.
While OTAs have long been a dominant source of indirect hotel bookings, metasearch sites like Kayak, Trivago, TripAdvisor, and Google have recently become much more relevant in hotel marketing and distribution channel discussions.
As you know, OTAs are indirect booking channels that own the relationships with your guests. Metasearch sites, on the other hand, are primarily not booking channels. They are advertising platforms on which hotels (and OTAs!) can market their inventory. From the price-sensitive consumer perspective, metasearch sites have the distinct perceived advantage of being a one-stop shop—it’s a way to research hotels available during their desired travel dates, read reviews and compare prices between different booking channels (including the OTAs).
However, we’ve recently seen a blurring of the lines between OTAs and metasearch sites. First, a sweeping trend of industry consolidation has led to acquisitions; like Kayak by Priceline and Trivago by Expedia. Also, much like the OTAs, TripAdvisor and Google have integrated inventory into their search results with a Book Now button, leading many to wonder whether a hybrid OTA/metasearch model is on the way.
Given this information many hoteliers are asking, do I really need to invest time and money in metasearch?
The answer is, probably yes. If your guests are using metasearch sites to book hotel accommodations, you need to have a presence on those sites. Fortunately, there are some great benefits to investing in metasearch.
What are the benefits?
1. Reduce cost per booking
OTAs like Priceline and Expedia are now charging booking commissions as large as 30 percent, taking ever larger cuts of the hotel’s bottom line. Metasearch sites, however, operate on a different model, as businesses pay on a cost per acquisition (CPA) or cost per click (CPC) basis. This often results in hotels paying much less overall per booking, allowing them to keep more of their profits. TripAdvisor, for example, offers a CPA model and charges only 12-15 percent of the booking, in exchange for a guaranteed 25-50 percent visibility in search.
Google’s metasearch program is a significant opportunity for hoteliers to lower their cost-per-booking vs OTAs
Google has also jumped on this model in their own way with the Google Hotel Ads Program. With this program, ads appear deeper in the consumer’s hotel search process, as prospective guests narrow their requirements for your specific type of hotel, resulting in stronger conversion rates and higher returns on investment. Hotels can choose the OTA-like CPA model or the traditional CPC model. But in both cases, the hotel “owns” the customer and receives the contact when the consumer books.
2. Increase your visibility
Traffic to metasearch sites has tripled since 2014. This isn’t likely to slow down any time soon, given developments like the meteoric rise of Google’s travel business and the heavyweight ad spend of sites like Trivago and TripAdvisor. Metasearch sites are increasing in popularity with consumers and hotels should use this to their advantage.
3. Defend your turf
Hyde Resort in Florida: an example of an independent property disrupting OTA squatters on their brand name on metasearch (Google)
Expedia and Priceline Group together spent $5.8 billion on advertising last year, with 23 percent ($1.3 billion) of that deployed on TripAdvisor and Trivago. In other words, your OTA partners are likely using metasearch sites to sell your hotel. Why not claim your own presence on those metasearch sites, pay a lower price for the booking AND get the contact info of the guest?
4. Own your guest data
With metasearch sites, hotels receive the booking as a direct booking, as these sites either redirect guests to the hotel’s website or integrate directly with the hotel’s CRS/booking engine. This means you receive the guest’s contact information and other data, rather than a generic Booking.com email address. Once you have that data, you now have the opportunity to market directly to that guest with targeted email marketing and win back direct, repeat business.
5. Diversify your marketing
The cost of other direct traffic sources continues to rise, making metasearch a proven, viable option to diversify your marketing investments. Search engine marketing pay-per-click (PPC) costs (especially on Google), burning holes in hotel marketing budgets around the globe.
“Since 2012, we’ve seen more volatile fluctuations to Google CPC (cost per click) costs for both branded and non-branded keywords in certain markets,” said Shannon DeFries, director of digital strategy & optimization at Tambourine. “Most hotel’s branded keywords have become much more expensive.”
This chart from Search Engine Land illustrates the rising cost of PPC and the associated increase in PPC spends
Metasearch: Keys to success
1. Pick the right sites
Some metasearch sites may yield better results than others, depending on factors like your hotel’s location, the type of experience you offer, and the types of guests you attract. If you’re a small hotel with fewer resources, it’s a good idea to closely monitor your return on CPA/CPC spend for each site. This way you can prioritize the channels that perform best for you.
2. Use technology to your advantage
The thought of managing yet another distribution channel may be daunting to revenue or channel managers who are strapped for time or have little to no experience with CPC ads. Fortunately, there are ways to easily manage all of your distribution channels in one place, including automated best rate guarantee on your direct booking engine and dashboards that instantly show you your return on investment.
3. Get help if you need it
On the other hand, while revenue and channel managers at branded hotels may leverage technology to help them scale, their counterparts at independent properties may struggle with the additional load and should consider outsourcing metasearch to a trusted and experienced agency partner who will help them achieve their revenue goals.
4. Close the loop
Now that you have a relationship with this guest, it’s important to convert that guest to a direct booker. Make sure your marketing team communicates with these guests regularly after the stay with offers and incentives to book directly with you the next time they take a trip to your area.
Tambourine uses technology and creativity to increase revenue for hotels and destinations worldwide. The firm, now in its 34th year, is located in New York City and Fort Lauderdale. Please visit: www.Tambourine.com