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Hotel E-Marketing 101
7 Questions that every Hotelier must be able to answer
ZDIRECT, INC.
November 1, 2010
Authored by: Hayes Thomas
Hotel EE-Marketing 101
7 Questions that every Hotelier must be able to answer
1. So…You spent all this $$$ investing in a beautiful website for
your property, and then again in driving traffic to that
website…what happens when your website visitor doesn’t
book a room at your property?
2. What is your average monthly website traffic volume?
3. How many of those monthly visitors are unique?
4. What is your unique visitor to email registration ratio?
Hotel E-Marketing 101 | 11/1/2010
5. What is the LTV (lifetime value) of an opt-in, permission based
email address from someone that you have earned or
established a relationship with?
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6. Why is it important to collect email addresses from your guests
and potential guest inquiries?
7. Why is building a quality email list important?
Knowing the answer to any or all of these questions puts you
ahead of most of your peers. Scary enough, most people that
consider themselves “experts” in the area of hospitality emarketing don’t know the answers.
Most people get stumped at question #1, some make it to
question #2, but soon are baffled by the concepts revealed in
question #3 and beyond.
Read on to understand why the answers to these questions will
have an overwhelming effect in determining how you will
market your property in the future. The correct answers to these
questions will also allow you to understand that eCRM is such a
powerful tool, that it will help completely revolutionize the
manner in which you operate your entire property.
The famous saying is that “I know that at least half of my
marketing is working…I just don’t know which half!”
A good eCRM platform will allow you to measure which half is
working…you will then know what to do with the other half!
Hotel E-Marketing 101 | 11/1/2010
eCRM is a technology-based tool that will help you streamline
your hotel operations providing you with the utmost of
operational/cost saving efficiencies, business and marketing
intelligence leading to more bottom-line conversions resulting in
greatly enhanced ROI, Increased Occupancies, ADR, and
REVPAR.
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Hotel E-Marketing 101 | 11/1/2010
Answer to Question #1
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Plain and simple! The answer would be …”You would hope that they
would come back!” In today’s current world most hoteliers have only
invested $$$ in providing a point of presence on the web through a
website, and then have invested (in most cases… huge sums of money)
in ways to drive traffic to the website to see and view their property/
product. Most hoteliers don’t realize that one of the true powers of a
comprehensive eCRM strategy would ensure that you have a mechanism
through your website to field all inquiries, whether they purchased or not
and then allow the hotelier to harvest the data and be able to “push” a
message out to these inquiries and “pull” them back to your website for
future potential conversions. If you have strong eCRM technology it
will also gather preferences and build a profile on your inquiries
allowing you to build a targeted marketing approach to conversions.
This can have a huge impact to your bottom line if you know what your
“look to book” ratio is, and you have just found a new way to talk to
your audience with messages of relevance, one-to-one. It will also
increase your amount of “lookers” by building an “email brand value”
for the eCRM platform has systematically built an ongoing, “interactive”
relationship with your entire client base creating loyalty and interest. It
is important to serve the needs of those with a short term need to find a
room, but the better guarantee is that you would have the chance at least
of getting most of them back in the future to convert based on additional
preferences enabled by the CRM system.
Answer to Question #2
Hotel E-Marketing 101 | 11/1/2010
If you are really paying attention to this monthly statistic…what is your
monthly website traffic volume…and if you don’t know…then you
should know. Any website agency providing such service to your
property should be sending you such elementary statistics on a monthly
basis. You would be surprised how many hoteliers have never even
thought about evaluating their website traffic. This information is
crucial, for it allows you to understand how effective your site is in
driving forward the goals you have for your property, and it helps you
set a baseline of how to improve your effort, month over month. It is
also a way to measure the value you are getting from you website
vendor. All of the statistics help you in understanding the value
proposition your product is making to your clients, and how effective it
is being communicated.
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Answer to Question #3
Hotel E-Marketing 101 | 11/1/2010
This is where most hoteliers get stumped…it is one thing to know your
average monthly website traffic volume, but when it comes to an
underlying statistic like, unique visitors, most hoteliers miss out. This is
probably one of the most important statistics you will ever get from your
website analytics, another important statistic being of how fast this
number is growing. A unique visitor is a first time visitor. It is
interesting to see how much traffic you are getting on a monthly basis,
but you can really tell if your marketing is working by how strong your
unique visitor statistic is and if it is increasing or decreasing…this means
new eyeballs to your property and new customers to convert! As
mentioned before, if they don’t convert the first time they come to your
website, how do you know how to get them back for future conversion
possibilities?
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Answer to Question #4
If you are one of the net savvy hoteliers that have gotten through the first
three questions…then congratulations…you are really good…and if you
know the answer to this question then you are in the top 1% of your
peers!
A whitepaper by one of the “scribes” of our industry, “Email Metrics,
Beyond Clicks, Opens and Bounces” by Tami Monahan Forman,
Director of Strategic Solutions for Return Path talks about this most
important statistic that every hotelier must be knowledgeable of on a
constant basis, for it provides the quickest way to generate new clients to
a hotel property. Tami writes:
Email Acquisition Process
Your customer response rates start from the second
you attempt to sign someone up for your email list.
Following are three metrics to consider:
If you don’t see that happening on your site, it’s wise tore-visit your email capture
process. Make sure that you are presenting the value proposition strongly enough to
pique interest – remember that “special offers” is rarely a strong inducement. Then
make it easy for people to register by including the sign-up field on EVERY page
of your site.
This means that if you know the answer to question #3, monthly unique
visitors average, then add this formula and do the math. Average
monthly web traffic of 10,000 visitors with 1000 uniques, generating a
Hotel E-Marketing 101 | 11/1/2010
Visitor to Registration Ratio:
Although many marketers wisely capture email addresses over the phone and in retail
locations, the majority of sign-ups happen online. When you look at your monthly list
growth rate, there should be a strong correlation between the number of unique visitors
to your website and the number of email subscribers added. In fact, that ratio should be
pretty close to 1:1.
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Hotel E-Marketing 101 | 11/1/2010
1:1 ratio of unique visitors to website email registrations, equals 1000
new email registrations per month. That means 12,000 new potential
people added to your list to market and sell to. Now you might say that
percentage is impossible, but, who knows - if your current average is
less than 1% like most people find out, certainly 2 in 10 or 4 in 10 is
better than less than 1 in 10! Every little bit counts, and if you have ever
tried to collect email addresses from people, you would appreciate how
difficult it is, and then understand the easiest way to collect such
addresses is online. The better this statistic gets, the better your bottom
line could be!
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As mentioned before a strong eCRM system will allow you to not only
optimize your email registration ratios, but it should provide profile
elements to you when your prospective clients register, so you can now
communicate with them on a one-to-one level with messages of
relevance. This concept of speaking to someone on their terms
(messages of relevance) is the difference between when an email gets
opened, reviewed and potentially converted into business vs. spamming
a recipient with junk mail that gets unopened and deleted, and even
worse, potentially alienates them from your property. This is where
strong eCRM systems take on their own net worth in moving from
generic bulk email campaigns to targeting your message to a highly
receptive audience. This will lead to optimum open/click
thru/conversion results. Sending bulk email to the masses fails the test
of time through creating list fatigue and unwanted list attrition. Sending
relevant offers/info to a highly targeted audience delivers optimal results
in bottom line conversions.
Assigning a monetary value to customer data is a concept that not many
hoteliers have realized yet. The answers to all the questions in this
document show how fast the dollars add up and even more importantly,
whether they are adding up positively or not. Everything else in the
organization is treated as an asset with measurable financial worth:
inventory, people, property, etc. Most people forget about the huge asset
of their client data, more importantly the monetary value of a specific
guest? It could be said that your customer list/customer history is your
gold, but do you really know how much gold that is worth, and how fast
it can be added to? This is where we come into the concept of an
“LTV,” or Lifetime Value of a client’s data. With the incredible cost
efficient medium of messaging the client electronically, the more
valuable the client data, and, if it includes an email address, the more
valuable the opportunity to message that client and generate a
conversion/additional conversions. One important concept to
understand is that the hotel needs to earn the email address properly –
through proper permission based methods using “best practices.” One of
the biggest traps in the market today is data appending or buying lists.
There are a lot of companies charging and making big money on
appending email addresses to hotel customer history data and selling
lists either outright or through co-op arrangements. This is completely
against “best practices” and will lead to huge problems for the hotel
down the road. The only way to create a quality house list is to generate
emails to that list through proper best practice methods in earning or
establishing a relationship with the recipient, and acknowledging their
permission through the entire process. The eCRM system will then
develop an on-line relationship with each individual client on a personal
basis through various techniques using “best practices” building your
property image, interest, and email brand value.
Hotel E-Marketing 101 | 11/1/2010
Answer to Question #5
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Hotel E-Marketing 101 | 11/1/2010
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How do you compute the LTV of client data? More importantly, how
you have earned or established a relationship with this client, and how
strong is that relationship? You should certainly consider the past client
“spend” for each customer in your database. But then, if they have not
converted them into a customer yet, then do you have enough profile
information for them to assign a value? Your eCRM system should be
able to tell you all of this depending on how strong it is. Considering
you have all of this information, with a fair degree of certainty, you will
know how much revenue you can expect that account, group or guest to
spend in the future based on past performance and assign some type of
value. It could be argued that no matter what type of property you are
running, the minimum LTV of an opt-in, permission based email address
could be at least $25.00. More importantly, if you compare that $25.00
figure to your ADR, then it could probably rate at $50, $75, or even
higher for the LTV. Once again, the importance of having a eCRM
system strong enough to pull together all of this information is
tantamount to understanding the asset value of your customer data.
Pulling all of this together and delivering that into an efficient and cost
effective, communicative medium and ensuring the delivery of such
message is all dependent on the technology you have implemented for
your property. This is so important to understand, for there are a lot of
vendors in the market touting that they can do this, but until you look
“under the hood” will you ever know? Even more important - when you
do look under the “hood” do you know what to look for?
Answer to Question #6
Get that Email!
Hotel E-Marketing 101 | 11/1/2010
This is where the “rubber meets the road” in understanding why getting
the email is so important? The questions is….Why is it important to
collect email addresses, both pre and post? Well the simple idea is that
if you have determined an “LTV” for that email address, say just $25.00,
then add every potential and passed client that “touches” your
property….i.e. stays with you, calls you, visits your bar, your pool, visits
your website, responds to a promotion…if you didn’t get their email
address, then you have just lost $25.00! Multiply that times all the
clients that touch you in a day, week or month and it can add up
substanitially! That is why it is so important to implement a strict policy
with all of your employees, policies and procedures to collect that email
address and also, now, the cell phone number (for text messaging
purposes)! And if possible, gain some profile elements with the email
opt-in, so you can talk to them on a relevant level immediately!
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Answer to Question #7
Hotel E-Marketing 101 | 11/1/2010
Why is building a quality email list important? If you are a stake-holder
and are challenged to increase the bottom line, it is powerful to have a
quality list of well-profiled email recipients that you can market to on a
“proactive” basis ensuring the bottom-line. If you are the hotel owner,
then you have a new asset to add to your balance sheet. Just as the
concept holds true of buying a private yacht with a charter following, the
same holds true for a hotel property with the same identifiable charter
following. Also, the asset value could be argued as such: 100,000
emails @$75.00 LTV value = $7.5 million as a new line item asset on
the property’s balance sheet. This becomes quite a distinguishing
element to the attractiveness of a “polished” property in a resale
situation, plus all the other added benefits leveraged on future revenues
through this asset to the property during the valuation/negotiation
process to complete the sale.
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About Hayes Thomas
Hayes Thomas’s background encompasses over 35 years of experience in all
aspects of Information Technology (IT). His years have been spent with vendors
of proprietary/open hardware and operating systems, database software,
network operating systems, data-communications software and hardware,
telecommunications fiber optic switching systems, business-to-consumer and
business-to-business internet applications, and, of course, a user of systems. His
association has been with all sizes and types of end-users, corporate and major
accounts in a variety of industries. This experience includes extensive sales,
marketing, general management and senior officer involvement with P&L
responsibility. Having Co-founded ZDirect, currently, Hayes is the President &
CEO of ZDirect, Inc., and has been the visionary behind the growth of the
world’s fastest growing eCRM company with over 2000 hotel clients in over 6
continents/30 countries. Hayes can be reached at hayest@zdirect.com
With ZDirect's patented ZMail® and RezQueue® technology and expertise,
hoteliers are able to centralize their databases, send "intelligent," targeted and
highly personalized communication to their guests and subscriber list. Then
when they book, automatically send confirmations, pre-arrival emails, thank you
emails, customer satisfaction surveys and ultimately convert leads and previous
guests into long term customers. The result is new revenue captured, stronger
customer loyalty, expanded customer base, and increased return on investment
Hotel E-Marketing 101 | 11/1/2010
About ZDirect, Inc.
Based in Miami, Florida, ZDirect is the preeminent
provider of electronic marketing and eCRM solutions
for the hospitality industry. ZDirect's product
offering takes eCRM communication technology to a new level of effectiveness
by giving hoteliers a powerful suite of tools to impact relationships with their
guests and inquiry base. ZDirect empowers hotel operators to streamline their
entire electronic marketing and CRM efforts returning unprecedented ROI.
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through the reduction of traditional marketing costs via measurable electronic
marketing. ZDirect is an Enterprise Email Service Provider (ESP) for the
Hospitality Industry and the ideal solution for Hotel companies that require
cutting edge features, solid integration and professional services. Features and
benefits of the ZDirect platform include:
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Hotel E-Marketing 101 | 11/1/2010
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Central Data Warehouse
Property Specific Email Marketing
Corporate Email Marketing
Mobile eCRM
Social eCRM
PMS, POS and CRS Interfaces
Pre & Post Stay Communication
Customer Satisfaction System
Electronic Concierge On Demand
Reservation Communication Portal
Web Guest Acquisition Engine
Golf Tee Sheet Integration
Dynamic Content Engine
Hospitality ROI Reporting
Advanced Filtering and Segmentation
On Demand ROI Reporting
Full Service Email Service Provider
Profile Consolidation Engine
State of the Art Forms Center/Survey Engine
Shopping Cart Abandonment Engine
Visit www.zdirect.com for more information.
For general inquiries email us at sales@zdirect.com.