Travel Agencies, Commoditization, and Brand Value
This is a pretty simple relationship.
Hotels currently rely heavily on agencies to drive bookings. This approach leads invariably to the handover of large portions of marketing responsibility to the agencies and to commoditization and a heavy focus on price – all exacting a heavy toll on hospitality brand value.
Commoditization has two main effects:
- Reduction in bookings volume and price
- Erosion of brand value resulting in significantly lower property sales prices by developers
The equation is simple:
Agencies = Commoditization = Reduced Brand Value
Commoditization can be avoided through full ownership of marketing and treating your distributors as just what they are, “distributors,” not “marketers.”
Starting with the Obvious
Let’s face it, most hospitality brand sites are pretty horrible. Most look exactly the same and many look like weekend afterthoughts. Only a very few are really good – and these are to be greatly commended. Many, however, seem to have spent very little time or thought at all, leading us to almost wonder why they chose to have a website in the first place.
In most cases comparing the online footprint of most 5 star properties to the extraordinary experiences available on the property itself, the website is actually eroding brand value in our opinion. We feel in fact that a lot of properties may be better off having no website at all compared to what they do presently have.
This is point one. The second key point is that it seems quite clear that most properties are spending very little on SEO. Usually a keyword search (even long tail, regionally specific keyword phrases) result in SERPS (search engine results pages) full of commodity distributors (called travel agents) with very few principal companies listed directly.
So the first step for most brands is to get a website that communicates the differentiated offer available at the property, adds some value to clients and that is not digitally invisible…Digital Marketing 101.
Motive is the set of experiences (be they business or tourism) available at the destination. The single reason the traveler chooses a destination is to fulfill motive. It’s pretty simple.
In the case of an expansive resort, the resort itself can be a big part of the motive (but certainly not all). In the case of business travel, the hotel becomes usually a quite small element of the motive (near zero, in fact, in many cases).
For most travelers the majority of motive is fulfilled outside the hotel property. Property owners and managers need to first catch this key structural point.
In most cases travelers visiting your property are not visiting the property because of you or the property. (Sorry to break the bad news.) Normally it is for a broader set of reasons.
For most travelers planning a trip to a new destination – the starting point is, of course, online search. Normally the user will find a mish-mash of travel agency sites, tourism board sites and so on – very few of which are satisfying. The user comes away from this experience (often after hours of effort) with shallow and incomplete information and with only a rough idea that he may have found a suitable destination. They are left with the responsibility to make an important decision on a limited set of poor quality and often confusing information.
One of the last steps normally taken by the traveler is to book the hotel that he often does in an extremely commoditized environment of a travel agency site. Room booking, being one of the last things the traveler thinks about, further commoditizes the offer as the property gains little mindshare.
The search process looks something like this:
Hotels can leverage this insight to become the center or home-base of activity and act as the local “concierge.”
Being a superb, complete, expert local concierge is an excellent value-add service that can quickly enhance the hotel brand value. The hotel becomes the trusted assistant who can solve all problems and fulfill or help fulfill all trip motives.
Now…this process does not have to start after check-in (in the rare case that any particular traveler has in fact even selected the hotel in question).
It can start at the beginning of search. Instead of becoming the afterthought and last step in the process, the hotel can be the introduction and steady guide throughout the entire process.
Hotels could create a superb online resource that becomes the “go to” site for information about a particular local community in which they reside. Think of this as the online “local hub” featuring all the “grassroots” experience opportunities in the community that serve to fulfill all motives, a deep and rich pool of trusted, thorough and complete information.
The remarkable thing is that hotels already have most of the critical information needed – they just have it locked and extremely under-leveraged behind the concierge desk.
Becoming the local informational hub places the hotel in the high-visibility and high-value position in the overall trip purchase process. They become not only the starting point in the planning process – they become the planning process itself!
A hotel’s existing on-site concierge staffs could be a superb source of the grassroots information available. This information could be extracted, professionally prepared and organized for presentation on the hotel’s go-to local hub site.
Over time, local grassroots establishments will clamor to be on the site further enhancing the depth of information available.
Now, search looks like this:
Now, Amp the Game Up a Bit!
At this stage, leveraging your new “go to” motive oriented online resource becomes pretty simple. The key is to take advantage of all the site visitors planning a trip to your region by building relationship.
The best way to do this, of course, is with the human touch.
By setting up 24-hour toll-free telephone access, voice over IP (VOIP), text chat and email support, you create opportunities for interaction and building relationship. By creating person-to-person opportunities to share extraordinarily valuable (to the non-local person, keep in mind) trusted local knowledge and insights, you build very strong relationships.
Adding comments and replies to your content gives users a voice and allows them to speak their mind.
Allow them to make suggestions. then respond to them – letting them know their opinion is valuable.
And let them create new listings or recommendations and write reviews – this just adds to your site content increasing value and alerting you to new possible additions to your professional databases, articles and recommendations.
“But what if someone complains about me online?”
Excellent!! There is no better or higher visibility opportunity for you to demonstrate your concern, attitude toward continuous improvement, openness to criticism, and professional concern for a client than a complaint!
Complaints should be brought immediately up the managerial chain of command to the appropriate level so management can take advantage of the great and highly public opportunity presented by a complaint.
An online complaint puts you on center stage for a virtuoso performance!
In Other Words…
Think like a traveler – not a hotel. Only with this approach can properties maximize value to their clients!
The benefits to the General Manager of any given property are more bookings at higher prices, increased client loyalty and repeat business.
The benefits to a property developer are potentially even much higher. A developer who can show to an investor that they are fully in control of their marketing and daily enhancing brand value can clearly command higher prices than competitors that more heavily rely on commoditized distribution channels.
The price premium is potentially worth hundreds of times the cost – because investors also generally do not understand how to successfully manage marketing, and it will often be a more simple emotional reaction – peace of mind.
Showing a gorgeous well developed and managed property along with a superbly differentiated professional and world class cutting-edge, state-of-the-art marketing program with demonstrable results becomes much more powerful.
In the worst case it offers extreme ROI. In a better case it becomes “the straw that closes the deal.”
CEO | Rain8 Group LLC