Google Hotel Price Advertising Programme

Google Hotel Price Advertising Programme

The Google Hotel Price Advertising (HPA) Programme has been in operation for almost 18 months, so this is a quick summary of where we are in preparation for more on Google’s Hotel Finder.

What is the Google HPA programme?

The Google HPA Programme was originally launched late 2010 as a cost per click (CPC) programme, which featured a drop-down menu of prices in search results of Google Maps, and Google Places. In July 2011, Google trialled Google HotelFinder, a consumer search tool initially rolled out in the US and further extended to Key European cities in October of 2011.

Participating Sites

At this time Google is only integrating to systems that provide a source of aggregated hotel content. This would include OTA web sites, such as Expedia, Travelocity, or providers of aggregated hotel content via a Central Reservations System (CRS) used by hotel brands and hotel representation companies. So, to participate in the programme as an independent, a hotel must have an agreement with a CRS provider, via a representation company such as Utell, or technology provider such as Sabre Hospitality Solutions, or have a contract with a participating OTA programme.

The Price Menu

The drop down menu features a maximum of five prices, the number of prices displayed depends on the sites participating in the programme in the area, and that have a relationship with the hotels returned in the search results.  The first four positions are paid for and feature room prices from web sites participating in the HPA programme; these positions feature deep links straight into the booking page of the hotel being searched. The last position is unpaid, and reserved for the web address of the hotel web site that achieves the first, or highest natural search result.  This last position features a link to the site, but does not display a room rate or a deep link to the booking page of the hotel. So if you have a relationship with all the major OTAs plus a representation company then its likely that all five positions will be used, and essentially competing for positioning.  There are instances where a site could potentially be listed twice, if they top out on the natural search results and are the highest bidders in the HPA programme

What to look out for

There are three things to consider

1)     Cost of distribution

2)     Revenue optimisation opportunities

3)     Your strategy on how your guest gets to search for and book you

1) What’s the cost?

As an extension of the CPC model, there is no commission paid but the CPC fee is based on a percentage of the ADR of the hotel being searched. Base costs include an annual maintenance fee per property, plus the click-through fee. For every click through a percentage fee is paid to Google, currently between 02% and 0.4% of ADR.

What’s the charge to me as an independent hotel?

Costs to participate in the programme will have been defined by the third party you are connected to that is integrated into the programme. As mentioned previously this will be a CRS or representation provider, a brand reservation system or an OTA. For most OTAs participation is a way to get prime placement on search results screens alongside the brand or independent property, in addition to paid search results. Some representation service providers may pass on costs for participation in the programme so its good to ask where your rep company sits with this.

2) Revenue optimisation opportunities

From a revenue management perspective the programme offers an interesting take on cost of distribution. Participating sites can now increase the bid amount to determine the position on the drop down list, but for now the bid cannot be varied by arrival date, so for example you can’t yet use the programme to send increased traffic to a property during need periods. The programme can deliver results that look like there there are rate parity discrepancies from channel to channel in the price menu. Bear in mind that Google is not always returning live rate availability, so its not a substitute for a competitor rate tracking report, and there are circumstances where rates may be out of date, or no further availability.

3) How the booking gets to you from your guest

If direct bookings are a major part of your distribution strategy – which they should be – then as an independent hotel working with the HPA programme this still means factoring in the cost of third party booking fees, via CRS or OTA whichever way the booking gets to you at the hotel, since Google is only integrating at the CRS level. However one company to watch in that is offering an alternative is FastBookings who announced their intention to work with Google to integrate landing pages for individual hotels into the programme. In a press release from November 2011, FastBooking announced they have built this capability with Google, Tripadvisor and Trivago. When a booking request from one of these websites is received, the request is passed by FastBooking through to a dedicated landing page on the hotel’s official website which is then capable of displaying the results of the booking request from the initial site.  So in this case,  the hotel is able to respond directly to booking requests, and thereby retaining closer ownership of the guest relationship. Something worth taking a second look at.

For more good blogs on the Google HPA programme see Max Starkov, and Dennis Schaal

The 2012 Hotel Industry Social Media Survey – now in its second year – we are soliciting survey completions from you. The survey monitors the use of social media across the hotel industry and provides a useful benchmark on which social sites are most used, investment levels in terms of resource and budget, the technology being used to manage programmes, and whether programmes are outsourced or managed in-house. No matter where you are with your social media strategy your contribution to this survey is truly welcomed. Please complete the survey by January 31st. 

HSMAI-Europe Revenue Management Conference February 9th 2012 – A one day conference with a series of workshops exploring revenue management, distribution, impact of mobile on hotel distribution, and others. Revenue by Design will be running a workshop and will also provide an opportunity to learn more about the HSMAI Europe qualification – “Certified Revenue Manager” Sign up here…

HSMAI-Europe Certified Revenue Manager Qualification – Revenue by Design will be offering this certification course starting in March 2012. The qualification features 15 modules divided into three subject areas; Revenue Management, Distribution and Digital Marketing, and a series of Elective modules to allow development of specialist skills in the field of Revenue Management. Read more….

For more information on all of the above please follow the links, or get in touch

I look forward to seeing you at one of these events

Hotel Industry Social Media Monitor 2012

The Hotel Industry Social Media Monitor Survey  2012 is now open ! The survey was first run last year and was created by us in conjunction with RateGain. We welcome responses from all who are involved in social media at hotel property and brand level, plus the agencies who are managing social media programmes on behalf of a hotel or hotel brand.

The aim of the survey is to provide a comprehensive view of where hotels are in the development and implementation of their social media activities. This covers the social media networks, management of programmes, level of investment, training, plus the tools and reporting systems being used to track programme management.

All respondents will receive a copy of the survey results so please feel free to go and have a look and get involved.  To get a taste of the survey see the summary of last year’s results  Let us know if you have any suggestions to improve where we’ve got to.

 

We’ll keep you updated with the developments and the results as we go!

Revenue by Design working with HSMAI Europe to create the HSMAI Meetings Exchange at the Business Travel Show

We are working with HSMAI Europe to prepare the way for the HSMAI Meetings Exchange Pavilion at the Business Travel Show in London, February 7th and 8th 2012.

The HSMAI Meetings Exchange offers participants a dedicated meetings and exhibition space at the show, at a preferential rate for HSMAI members representing a saving of over 30%. This is a unique opportunity to connect personally with the corporate buyer community outside of the annual automated hotel RFP process, often cited as one of the most difficult communities to gain access to.

In the past corporate buyers have held the purse strings for transient (rooms) business, leaving small meetings spend diversified across many departments and making it difficult for hospitality sales executives to pin down the exact value of meetings spend in many corporations. This is now changing; 40% of travel buyers now have an active involvement in meetings spend, and this figure is set to increase as travel buyers seek to gain more control over their meetings programmes.

The Business Travel Show is Europe’s largest gathering of high quality corporate buyers, attracting over 5,000 corporate travel professionals in 2011. This year the show will feature its first Hosted Buyer Programme – inviting and hosting over 1,200 senior level travel managers and procurement managers with responsibility for buying business travel. Each of the Hosted Buyers commits to attending pre-scheduled appointments each day at the show. All participants in the HSMAI Meetings Exchange get the full benefit of the hosted buyer programme, making it a valuable opportunity to set up meetings and contract directly with buyers.

• HSMAI Meetings Exchange exhibitors have the opportunity to recommend hosted buyers. This entitles buyers to receive travel to the show and overnight accommodation
• Each of the Hosted Buyers commits to attending pre-scheduled appointments each day at the show, and HSMAI Meetings Exchange exhibitors gain access to the online diary to book pre-scheduled meetings.
• The HSMAI team will also be on hand to support exhibitors in optimising their time at the show, through suggesting contacts to meet and guiding exhibitors through the many opportunities to make contact with show attendees.
• The show also offers a programme of networking events open to exhibitors to further enhance the opportunity to create new relationships.
• Full details are available here HSMAI Meeting Exchange Pavilion

Please feel free to get in touch for more information or to talk about how you can maximise the opportunity for your hotel or group.

Look forward to talking to you, or seeing you in February!

London Revenue Managers stumble over Olympic bulk-buying tactics– Check your rates now!

Check you are happy with your rates on all channels for the Olympic period

With 305 days to go the Olympic Games and over 40,000 rooms allocated to the London Olympic Organising committee (LOCOG) over the Olympic period, speculation over occupancy levels and rates inLondonover the games is rife.

Spats between hotels and operators have already manifested over hoteliers blamed for hiking prices for Olympic packages sold at thousands of pounds by operator Thomas Cook. See hoteliers anger  – http://bit.ly/pUUSKk  and the Thomas Cook defence at http://bit.ly/nTVP1b

Stringent Conditions inhibit buying

Concerns are rising over sky high rates for the remaining 50,000 rooms in London not yet allocated to LOCOG. Mary Rance, Chief Executive of UK In Bound the association that looks after the interests of inbound operators highlighted Operator concerns that the combination of high rates plus stringent minimum stay restrictions of up to 10 nights, plus significant up front deposits make it almost impossible for inbound Operators and the independent traveller to book into the city. See http://bit.ly/rfCBPJ

Rooms that remain unallocated by LOCOG are not due to come back on to the market until the end of January 2012, so for those hotels that actively yield room rates, prices are likely to remain high over the period.

Not all Revenue Managers are with the programme!
However, not all revenue managers are on the ball in terms of yielding rates over the Olympic period. Jon West, Managing Director UK & Ireland HRS Hotel Reservation Service warns hotels to check the rates loaded across all channels during the Olympics. This follows incidences in the last few weeks where HRS has witnessed high booking volumes into hotels selling rooms in London that are comparatively cheap. And this has come as a nasty shock for some hotel operators. “We are urging all our hotels to check that they have the correct selling rates loaded now for the Olympic period. Some hotels were not aware of the demand for rooms over the period and had not adjusted rates to match demand. We are not responsible for the rates loaded by our hotels and room rates that represent exceptional value over the period will sell quickly.”

Our advice is to re-visit your revenue management strategy and check that you are happy with all rates across all channels and all contracted third parties for the whole of the Olympic period plus shoulder periods where impacting events will also affect demand – these include:

• The Queen’s Diamond Jubilee
• Farnborough International Air Show
• Ramadan
• The Olympic Games
• The Paralympic Games

FAQs

When are the London Olympics 2012?

• The Olympic Games are from July 27^th to 12^th August 2012
• The Paralympic Games are from 29^th August – 9^th September 2012

When is The Queen’s Diamond Jubilee 2012?

• Events to mark The Queen’s 60 years on the throne will take place in the first weekend of June 2012, with an extra bank holiday being created.

When is Farnborough International Air show 2012?

• July 9^th – 15^th 2012

When is Ramadan 2012?

• Ramadan will start on Friday 20^th July 2012, and continue for 30 days. Since the holiday begins on the preceding sunset the celebration will begin on the sunset of Thursday 19^th July see http://bit.ly/r50FDP

What time period should my revenue strategy cover?

• From The Queen’s Diamond Jubilee onwards i.e 1^st June to end September 2012

What business opportunities are available throughout the Olympics?

• LOCOG has taken up an allocation of 40,000 rooms so far to cover the Olympic period. Rooms that remain unallocated will be released back to the market in late January 2012
• Event planners are looking for meeting rooms and locations for corporate and sponsored events over the period
• Corporations, the media, and Sponsors are looking for exclusive use of properties over the period
• There will be visitors to the city via inbound tour operators and independent travellers – independent travellers will be searching for rooms via your normal GDS and OTA channels; make sure you have the correct rates loaded now
• Visit London2012.com  for more details

What rates should I sell at?

A fair pricing charter is being co-ordinated by VisitBritain and Visit London that businesses can sign up to show their commitment to reasonable and fair trading terms during the year of 2012. For more information see http://bit.ly/oP1XQg  Over-inflating prices will in the long term do damage to your business so be reasonable about rates quoted. It is possible that corporate business you rely on now may not want to visit London during this time, so take steps to find out who will be staying and how much business you may need to replace. Set your strategy based on your projected demand and closely monitor how well that strategy is working over that period. Adjust the strategy to accommodate any unanticipated fluctuations in business.

What about the Displacement effect  – will I lose all my normal business?

The “stay-away factor” or “displacement” is common to many host countries and cities of major sporting events and occurs when concerns around pricing, overcrowding, safety and general disruption keep normal, leisure visitors away and/or displaces them to other areas.  This displacement is often based on misperceptions and the impact may be felt throughout the whole year if left unaddressed.  Whilst the long term economic and tourism legacy benefits of the Games far outweigh this short-term loss, VisitBritain, Visit London, ETOA and UK Inbound are working to collectively tackle this issue.

The Facts from Oxford Economics
The Games are forecast to generate tourism gains totalling £2.34bn for the UK as a whole and £1.85bn for London according to the Oxford Economics report – see http://bit.ly/ozg2Od . The displacement effects linked to the Games are estimated at £375mn forLondon and £258mn for the rest of theUK.

From Market Segment Analyst to Behavioural Specialist – Managing the market segment of “Other”

One of the first questions we ask our hotels when we start working with them is “Who is your Customer?” Understanding who is booking into the hotel and when they book is one of the cornerstones of revenue management.

Increasingly the first answer is “Most of our guests are either leisure or corporate guests – the booking window is very short, probably about 48 hours for our major segment, corporate bookings – and its getting shorter”. 

OK – so that’s a start, but doesn’t say a whole load about the customer. Teasing out subsequent market segment information often discloses a lot of underlying confusion, misunderstandings and a heap of data that is difficult to trust.

The revenue manager as behavioural specialist

We know by simply reviewing our own behaviour when making hotel bookings that the tools we refer to at that time are likely to have a direct bearing on where we are, what is available, what we are doing at the time, the role we are playing – mother, manager, sister, friend, and the relative level of urgency related to the booking. We may have oodles of time to surf the web from home when researching a holiday, or may be restricted to a certain selection of hotels when making a business booking. That booking may be a last minute booking due to a diary change, or a long planned business trip.

Revenue Managers use multiple sources of data to identify who has booked in the past; we track market segments to understand more about guests who have previously booked the hotel, we develop and analyse booking patterns and use this information to help predict future booking patterns. We have rich sources of data available from guest history in the property management system, and as booking channels grow in diversity, and guests behavioural interaction with the hotel becomes more complex, so we need greater clarity from the data we use to predict guest booking behaviour, and hence greater accuracy in segmentation and the way we use segmentation.

The market segment of “Other”

So why, when segmentation is so critical for business visibility, is the market segment of “Other” so often the most predominant segment in the property management system? Our experience shows the key lies in developing best practice in reservations management. A simple, consistent and easy to understand process lies at the heart of a good segmentation strategy. Reservation agents need an understanding of what they are doing and why this is so important. This applies equally to the front desk team – as the last guardians of guest data quality at check-in.

A few pointers to start:

- Be consistent

- Be even more consistent

This makes it easier for people to follow the process and if you have to fudge some segmentation so that everyone can understand it, then focus on the simple stuff and take responsibilty for weighting results at the other end.

- Create a segmentation profile that reflects the business coming into your hotel. If you’ve inherited bad segmentation think about redefining it to make it more accurate; painful in the short term, miraculous in the long term.

- Keep things simple. If your team is having difficulties in assessing which segment a guest belongs to, make some predefined rules that are easy to understand. Bookings for an individual traveller, single occupancy, midweek are defined as corporate bookings. Bookings for double occupancy at the weekend are leisure.

-Separate group bookings from individual, and be clear on the contractual status of each segment

- Separate OTA bookings from those arriving direct to your website so you can track success of your direct to hotel web site marketing initiatives and separate out the marketing spend directed at OTAs.

- Ensure everyone understands the difference between how the booking was made and how it got to the hotel. An OTA booking made over the internet and arriving at the hotel via fax is not a fax booking, it’s an OTA internet booking.

- Sequence segmentation options so that “Other” or “Unknown” is not the easiest option to choose.

-Create a system to track cancellations, denials, regrets and no-shows to better understand the true pattern of reservations into the hotel.

- Ensure front desk and reservations are equally passionate about understanding who your guests are and incentivise accurate data entry.

- Emphasise what’s important in data collection – email addresses are fundamental to guest communication.

- Make sure you have all your legal data protection requirements covered.

Understanding customer behaviour is a fundamental driver for optimising revenue, creating an effective guest data management programme in your property is vital in creating accurate segmentation and reducing the emphasis on the fictional segment of “Other”.  Clearly lots more can be achieved in an automated environment; if you have a Revenue Management System then much of the leg work in data interpretation will be done for you, equally Property Management System interfaces will help in automating segmentation of reservations on entry into the system, but more often than not there is still manual work needed, which still calls for a robust data management strategy. 

And we’re interested in hearing from you – do you think traditional market segmentation cuts it in today’s market? What’s changing in relation to segments? Can we rely on our market segments to support anticipating buying behaviours today? When will CRM and market segmentation align within hotels?

Further reading:

I draw your attention to an interesting LinkedIN discussion on data quality, and use – or not – of mandatory fields in the property management system. http://lnkd.in/RHnN6R

The Hospitality Revenue Management Community on LinkedIn did some work on segmentation at a workshop back in March. Initial results are here Workshop Notes – March 04

“Where’s My Data? Tips and Tricks for Designing a Strong Data Quality and Data Integration Strategy.” Cornell Centre for Hospitality Research www.chr.cornell.edu – if anyone has the specific link to the webcast on this then please post it ! Thanks 

Mobile stats further prove need for hotels to build totally mobile strategy

Below is a synopsis of a press release relating to a survey conducted by TripAdvisor on 5,013 respondents across Europe, including 1,313 British respondents, from 23 to 31 May 2011.  Other countries surveyed were France, Italy and Spain.

The survey clearly shows how usage of mobile is impacting travel plans both pre-trip and within the trip; further reinforcing our recent comments regarding the need for an all-embracing mobile strategy that captures the guest in the pre-trip planning phase, during the journey and at the hotel. All of which require different communication skills, revenue management capabilities and technologies incorporating potentially QR codes, GPS, integrated booking engines, contactless near field technologies and SMS marketing.  For the full press release see http://bit.ly/kk8jYs

A survey of over 1,200 British TripAdvisor users reveals that that a significant 22% of respondents have incorporated a mobile device into their travel planning process.
“Travel on the go”
Of those using their mobile devices to plan holidays, researching and booking accommodation is the most common activity. Of those who plan travel on their mobile device:
- 29% have booked or researched accommodation
- 27% have researched destinations
- 26% have read traveller reviews
- 23% have researched restaurants
- 18% have booked or researched flights
Nearly half of British respondents – 45% – have used their mobile devices to plan and research their trip once they’ve arrived at their destination. For those respondents who use their mobile device while travelling, restaurant research takes priority:
- 29% researched restaurants
- 28% checked their flight status
- 21% researched attractions
- 18% researched accommodation
- 16% researched tours
British travellers playing mobile catch up
Although a large proportion of British respondents are already planning holidays on their mobile devices, it seems our European neighbours have adapted faster:
- 22% of Brits have planned a trip on their mobile device compared to 27% of Europeans
- 20% of Brits have booked accommodation using a mobile device, compared to 28% of European respondents, and 32% of French respondents
- 45% of Brits have used a mobile device to research their trip while in-destination, compared to 53% of European respondents
 More mobile findings
- 39% of British respondents have a travel app installed on their mobile device
- 14% of British respondents have reviewed a hotel, restaurant or attraction using their mobile device while on a trip
- 15% of British respondents have “checked in” to a place using their mobile device while on a trip