Josiah’s note: The following comes from a conversation I recently had with Tom McCallum. In this article, Tom discusses the travel booking process, and how it takes place today.

As John Wanamaker famously said: “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.”

I blogged on this a while ago – it’s becoming increasingly difficult for marketers to track their campaigns. I’ve noticed that as I deal with conventional tourism marketing – they’re not so familiar with online media. Their methods of tracking in all cases — not just online marketing metrics –but off-line: what’s the value of print, what’s the value of TV, what’s the value of radio? All of these conventional media buying metrics in which the old-school media buyers have so much experience… they find very difficult to track new media.

Travel Booking Isn’t Linear

There’s no straight line from ad campaign to purchase in travel marketing anymore. There’s just so many factors that go into purchasing travel.

If you take Expedia as an example – their numbers are down in a number of areas. People are using them as the Amazon.com of travel, they research there first, but increasingly Expedia and other Online Travel Agents are finding it more difficult to give people reasons to book there. As I was recently reviewing a survey done for luxury hotels and brands, it was quite stunning to see the stats on how people are booking directly through the hotels.

So there are no easy answers.I think it comes down to that really scientific thing: gut feel!

I feel a little bit like a Steve Jobs of travel marketing sometimes — “To hell with the research! This is what we need to do.” And I think hotel marketing is really in a state of flux right now. We have all the people that we’ve been dealing with for years — ad buyers, media agencies — but they really don’t understand online behavior enough yet.

It’s a Branding Issue

And then when you look at social media brand building, for example, like Gary Vaynerchuk has been doing. It’s the whole personal brand thing, and is so applicable to hotels – especially independent hotels.

We’ve got a great example of this with what Joie de Vivre hotels has been doing: building almost a personal brand of each individual property.

We get far too hung up on metrics. I think you get buried in numbers and put off by numbers. So I’m sounding a bit like an ad rep — saying not to worry about the numbers, and just buy my ads. But I think with regard to online metrics, I’m really just interested in how many unique site visitors I have, how many new visitors I’m getting, where they’re coming from, and what type of search they used to find us. Not just direct referrals – but the phrases that people are using to find us online.

And that’s the disconnect. If you find that 40% of people are finding you by typing your hotel name into a search engine — you’ve completely lost connection to your metrics. Where are they coming from? It could be a print ad, it could be completely residual, it could be they saw a special promotion and the price is right.

This is the way I see people coming to my client’s sites. People don’t bookmark websites anymore – they simply type it into Google. For example, if I don’t know the name of your blog, I would just type in “hotel marketing blog” — and arrive at your site. People just do that for everything.

Focus on Website Optimization

The important thing is website optimization. Let’s concentrate on website efficiency. Get people onto the site in the first place, and that’s where you can begin creating some good metrics.Monitor their path through your website, and adjust for sales efficiency.

Obviously for hotels, the question is: are we making it possible for them to book a reservation in the way they want at any stage? You want to make sure there’s a widget on every single page that allows anyone to commence the booking process at any time.

So do everything you can that you think would be effective in bringing people to your website and then focus on converting those visitors to bookings.

Read more…

Understanding and using web analytics can unlock marketing strategies that can produce large profits for your hotel when acted on. Some of the top insights you can get:

1. Know what visitors like and don’t like about your website
2. Determine the most important pages on your site
3. Watch the impact of adding new features or content
4. You will know which campaigns worked, and which did not
5. Discover the most important keywords for your hotel
6. Track which sites are sending you the most traffic
7. Learn which types of visitors are most likely to buy from you
8. Find errors and glitches on your website
9. Identify upselling opportunities on your website
10. Quantify the contribution of online marketing to your overall business
11. Which content keeps your visitors coming back
12. Which countries you’re most effective in
13. What time your website is most active: hour, day, week, month
14. Develop a deeper understanding of your guests

Analytics is a form of feedback, and usually very accurate. By recording and observing how people interact with your web sites, you can learn what they really think about what you are providing.

It takes the guesswork out of internet marketing.

How are you using website metrics to direct your marketing?

Omniture’s 2009 Online Conversion Benchmark Survey – conducted in July and released last Tuesday – reveals some startling facts:

• 80% of online marketers do not serve personalized content, and do not use performance metrics to promote content
• Less than 30% frequently test their content
• 70% of content decisions are unsupported by data

That’s scary. Especially if you depend on your website to generate sales.

Since I often talk about ‘scientific marketing’ it’s good to have some solid numbers on the state of the industry. More and more, I’m emphasizing the importance of conversion tracking, testing, and optimizing in the campaigns I manage. This process is fundamentally at the heart of internet marketing, and it would be a waste if we didn’t fully exploit it.

Tracking

Tracking is gathering the data as it is now. The process is quick and easy through tools such as Google Analytics. By adding once piece of code to your website, you can have access to hundreds of detailed reports.

Testing

Testing is letting the market vote on your marketing ideas. After tracking systems are in place, you can perform split testing to determine the best mix of your website elements. Testing replaces guesswork with pragmatism in the marketing process.

Optimization

Optimization is acting on the information you discover. Once you have data, you must use it. Few website owners continue through all the way to this step. It’s essential your site development is guided by the insights you’ve collected.

This 3-step system is the only proven way to achieve outstanding internet marketing results.

Are you investing enough into this process?

[photo credit: faith goble]

On this blog, I often emphasize the importance of developing and using metrics to measure the performance of your hotel marketing.

But sometimes, measuring your marketing limits its effectiveness.

David Meerman Scott has released an excellent free ebook, Lose Control of Your Marketing.

I recommend you download and read it immediately.

(This is part 3 of this series. Also see Advanced Blogging Metrics and Advanced Metrics for Social Media.)

As I showed yesterday, ad clickthrough (CTR) and cost per click (CPC) aren’t sufficient for measuring the performance of your hotel’s PPC campaign. By all means, track these statistics as well as revenue-related numbers such as:

• number of conversions (reservations, email inquiries from website, etc)
• cost per conversion
• conversion rate/percentage

Photo by aussiegall

But any search marketing manager worth her pay is already tracking those numbers. Here’s how you can push further and receive more insight from your hotel’s PPC campaign.

Advanced metric #1: Keyword quality score. Google assigns each keyword in your AdWords campaign a quality score of 1-10. The higher your score, the lower you pay for each click and the higher your ad may appear in search results. (Yahoo and MSN have similar systems) Dave Davis has a good post on how to improve your quality score.

Advanced metric #2: Coverage. I first learned about coverage from Richard Stokes, author of Mastering Search Advertising (an excellent book), and founder of Adgooroo. Basically, coverage is the percentage of times your ads appear when someone searches for your target keywords. If your coverage rate is low, you are missing out on potential clicks. I’ve personally seen campaigns that were missing 90-95% of impressions, which is a huge loss from a branding standpoint.

Advanced metric #3: Position vs. CTR. Another piece of good advice from Richard, you can often achieve comparable CTR at a lower cost by intentionally lowering your position from the very top. Doing this gets you around bidders with big budgets and increases your coverage.

Advanced metric #4: Position vs. Conversion. Many beginning search marketers think that conversion rates improve with their ad’s position. This isn’t usually true. The top position usually receives more clicks, but conversions usually remain the same through positions 2-5. Plus, with a lower ad position, your cost per click is much lower. Do you own testing to see if this is true in your situation.

As part of my quest to make social media marketing more measurable, I’d like to share some ways you can gauge the success of a blog.  If you’re thinking about starting one, hopefully this will demonstrate that the format can be tested for return on investment.  If you already have a blog, then these measures should help you measure progress:

Post Frequency: number of posts / number of months. Blogs exist for frequent communication with their readers.  Make sure your blog isn’t just a website with the word “Blog” in the title.

Unique Blog Readership: unique blog visitors + average daily feed subscribers.  Since many people receive updates through RSS newsfeeds (half of this blog’s readers do), you need to take these people into account as well.

Conversation Rate: number of conversations & trackbacks / number of posts (during time period). Engaging your readers is a core purpose of blogging.  How many of your readers interact with your hotel blog?

External Benchmarking: Technorati Rank.  With so many voices in the blogosphere, it’s important to make sure you’re relevant.  Technorati rank is based on the resources you contribute – and other people link to.  You can’t be a one-hit wonder, building your ranking takes time.

Cost of Blog Ownership: setup & hosting + time invested / time period (eg, 15 hours/week @ $75/hour).  Since time is a big factor in blogging, also consider the opportunity cost of your blog.

Return on Investment: Calculating blog ROI is a little more difficult, but consider these factors:

• Conversion rates from traffic from your blog to your hotel website
• Improvement in guest satisfaction
• Lowered cost of PR (press releases, media coverage, etc)

(Credit: Avinash Kaushik and his excellent book, Web Analytics: An Hour a Day)

Social media is commonly measured in numbers that aren’t very helpful to hotel marketers.

Blog RSS subscribers.  YouTube videos views.  Twitter followers.

The problem with these metrics is that it’s hard to measure success. Does our blog need 1,500 subscribers to be relevant, or is 50 good enough?  Does 10,000 views mean my video was a success?

More importantly, what actionable insight can you get from numbers like those?  Here are a couple of metrics that I’ve found useful recently:

Mention frequency – How many times per month (on average) are we reviewed on social travel sites?  The more mentions, the better.  It helps boost popularity ranking (below).

Popularity ranking – Especially useful for tracking progress in sites like TripAdvisor and Yelp.  Showing up in the top 10-20 results – on the first page – is very important.

Satisfaction percentage – This statistic is a little harder to generate, but the results are more insightful.  What is the overall consensus on your facility?  What areas need the most improvement?

Cost per engaged guest – Your social media campaign budget divided by the number of people you established dialogues with.  This figure measures your communication effectiveness.

To make smart marketing decisions, you need solid information. Of course, this is true in any economic climate, but with a possible slowdown ahead in the travel industry, the stakes are even higher.  All marketing expenditures must be justified by results.

If you’ve been marketing for a while, you undoubtedly know some metrics that work for traditional marketing and advertising campaigns.  However, the rules of the game change once you begin marketing online and encounter a wide variety of new media options.

What metrics should you use to measure the effectiveness of your digital hotel marketing campaign?  Let’s start off by putting aside a couple web marketing metrics that have been used in the past, but aren’t really that helpful anymore.

• Number of ad views – in the early days of the web, it was common to purchase advertising based on the number of ad impressions or views.  Now, there are other more effective ways (such as pay-per-click).
• Website visitors – the number of people that visit your website might have little correlation to the effectiveness of your marketing campaign.

Should you track these?  Absolutely.  They just don’t provide enough insight.  So let’s move on to some more helpful metrics.

1. Conversion rate – what percentage of website visitors are booking a room?
2. Cost per booking – actually, you should be tracking a wide variety of “cost-per” actions for any advertising campaign. How much does each click, visitor, and lead cost? Spending must be tied to revenue gains.
3. Referral source type – knowing the type of websites that provide the most visitors can help you decide the direction of your marketing campaign
4. Search engine rank – How high do you rank in search results for each important keyword phrases?  Search is still the #1 way people find websites, so you need to list high for key phrases.
5. Social media mentions – How many bloggers and social travel networking websites are talking about your hotel?

Those are the core metrics that are important for anyone doing hospitality marketing.  Other metrics that could be useful in your situation include:

• Percentage of positive mentions in social media – this statistic is a little harder to generate, but the results are more insightful.  What is the overall consensus on your facility?
• Average time on site – how long do people stay on your site?
• Bounce rate – how many people leave your website without visiting any other pages (the lower this number, the better)
• Reservation abandonment rates – you need to know when and where potential guests are giving up in your booking system
• Top referral keywords – which phrases do people use to find your website?
• Number of inbound links – your goal should be to increase the quantity and quality of inbound links each month
• Google Pagerank – Google’s measure of website authority

Whatever combination of indicators you plan to use, the important thing is that you track and save this information.  You can only make efficient marketing decisions by looking at historical data, and then focusing your marketing resources on what works.

Let me ask you this: What metrics do you use for digital marketing?

I came across HowSociable? today – which offers a way to measure your brand’s web presence in social media.

The site is still in development, so you may not agree with their visibility score or choice of benchmarks (it’s not tailored to the travel industry), it’s another tool to use for reputation management.

Having a web site isn’t enough anymore.  Now, the key to online market leadership for your hotel is establishing a web presence.

A new social media research report by Universal McCann puts some hard numbers behind this trend:

• 73% of online users read a blog (what guest experiences are they reading?)
• 57% join social networks (do you have a presence there?)
• 45% have started a blog (what will they say about your hotel?)
• 83% have viewed a video online (can they find one for you?)
• 36% think more positively about companies that have blogs (does your hotel have one?)

Some more insights for hotel marketers…

1. The 3 most popular social media participation activities are watching videos, reading blogs, and viewing pictures.
2. “In the world of social media, honesty is the only policy”
3. Reputation management will become more important as social media participation grows
4. Think globally; your customers are

Here’s the full report: