Conclusions after investing €27,000 in 58 hotels.

Your direct rates, your hotel’s website rates, can now appear on Tripadvisor dealing face to face with intermediaries such as booking.com and expedia.com. Should you join this program? What can you expect regarding the required investments and the return you will obtain? Does this return affect your hotel’s position within your city’s ranking? After a comprehensive three-month study, we have got answers.

Tripadvisor’s CPC (Cost per Click) program will generate new bookings in most of the hotels’ websites, mainly for the best rated hotels, but it is not predictable when it comes to cost and can generally be expensive “commission wise”.

In any case, “high” commission is a relative concept and should always be compared with the margin you get through intermediary sites (IDS) or classical tour operators . It still might be worth it for many hotels. Here is how we got to this conclusion.

In May 2010, Mirai pioneered the testing of the Tripadvisor Business Listing. Once again, we were given a chance to explore the new opportunity given by Tripadvisor – their CPC program. The difference between them is that the former is based on a fixed fee and the cost of the latter is variable depending on the traffic.

Other companies on the market offer this service (sometimes with a set-up fee or monthly fixed payment) directly to their clients promising new bookings. Before doing so, we at Mirai, have conducted a test to check the return you can expect by participating in this program. We invested €27,000 in 58 of our clients and analysed the results.

So what is the CPC program and how does it differ from Business Listing?

Business Listing allows you to add a link to your website, as well as the contact information (Blue).

On the other hand, the CPC Program allows you to compare the rates of many providers in real time (Green). We can see in detail how it works in the following screenshot.

The user selects a check-in date and clicks on the button to see the rates.

By default Tripadvisor opens three new windows with the first bidders. In this case, the official website montecarlobcn.com, booking.com and venere.com are the three that bid the most to be there, and therefore they get their reward.

Once the user has compared the three options, he/she will choose one of the websites to make the reservation (if this is what he/she decided to do). Let’s assume he/she has been persuaded to make the reservation through the official website. He/she could easily do so by selecting the room and concluding the process. We will not show you screenshots of the reservation process as they are not relevant for this analysis.

In the following table, we easily show the differences between both programs.

* Hoteliers can manage their business listing entry to Business Listing and pay directly to Tripadvisor.

** You can only participate in this program through “partner companies”. Apart from Mirai, other companies that offer this service are Flamingohotel, Fastbooking, AvailPro, Bookassist, WihpHotel , among others.

It is important to note that simply participating in either program does not improve your chances for getting higher rankings in your city. These two things are totally different.

The test.

Over the course of 3 months, we included 58 hotels from Spain and France of different characteristics, from the top ranked in Tripadvisor to some others placed at the bottom of the ranking, and with different features (rate, size, classification, location…) and checked their behaviour in terms of traffic volume, conversion rate, reservation value and return of investment. There are some interesting analyses already online, such as the one from wihphotel, but we are hoping to provide you with a more extensive view on the matter.

The first thing we notice is that 14 hotels (24%) did not receive any reservation.

Hotels that did not receive any reservation are those that brought little traffic, had low conversion rate and were usually lower ranked than the ones that did.

Traffic – the higher you rank, the better, but be prepared to put the money on the table.

The first thing we wanted to find out is the correlation between ranking of the hotel (per city) and traffic volume. A quite obvious assumption, but true, is that the better ranked hotels will have the bigger traffic volume.

This correlation is clearly seen especially when it comes to hotels ranked within big cities where the volume of searches and competition is big. Always in terms of traffic volume, you get more visibility if you rank high in big city (such as Barcelona, Rome, Paris, Madrid), than to rank #1 in a small town that travelers do not visit that often.

We cannot forget about the cost aspect, as the Tripadvisor system is based on the “Pay per click” model. Hotels pay from 0.6 to 0.8 euro per click. Being in the top ten in cities such as Madrid and Barcelona means thousands of clicks and euros spent every month, which is not the case in small cities that get less traffic.

Generally speaking, most of the traffic goes to those that rank on the first page in a large city searches. Apart from that, there is no difference between being on the 3rd or on the 10th page, even if you are lower in the ranking.

Traffic grows exponentially according to the position of the hotel’s search results.

Conversion – don’t expect too much.

Analysing conversions shows how many visits are needed to make a reservation. Visits to your website come from one of these sources: organic traffic (mostly from browsers such as Google, Yahoo or Bing), paid traffic (mostly Google Adwords), people typing the url directly into the browser (direct)traffic coming from links placed all over the web (referral). In order to check the effectiveness of Tripadvisor, we decided to compare the conversion rate across all the most popular traffic sources.

It is hard to draw any conclusions, but we clearly see that Tripadvisor’s conversion rate does not differ that much from other sources (with the exception of Google Adwords, where we obtain high conversion by means of campaign optimisation).

Note that there are other factors that may have influence on the conversion rate such as price, hotel location, service, price parity, etc. In this analysis, we will not go into detail about those factors.

Worth mentioning is that the cost per click of Tripadvisor’s CPC Program, compared to other paid channels such as Google Adwords, is significantly different. On average, a click in Google Adwords is charged €0.3, compared to Tripadvisor’s €0.65 to be in first position in the “check rates” box. So the profitability might be an issue here. Let’s take a closer look at the “commission” aspect comparing commissions depending on their origin.

Commission: the higher you rank, the lower commission you pay.

Most of the hoteliers are used to a commission-based system, mainly because it allows monitoring and comparing cost and benefits. Nowadays, the commission level of the intermediaries is between 12% and 20%. Above this margin, the profitability of using a channel is uncertain.

The cost of a Tripadvisor’s CPC program is not based on a commission model but in a cost per click system. The value of the generated reservations should cover this variable investment in exactly the same way as takes place in the commission-based model. This is why we must transform the cost into commission.

Transforming the investment in TripAdvisor into the commission-based model.

When using Google Analytics, we analysed the reservation value obtained from TripAdvisor and the cost of the service (current CPC spent). To enable us to compare the analysis with other booking channels based on a commission model, we calculated what percentage of the reservation value covers the investment in TripAdvisor’s PPC program. This allowed us to see the profitability in a clearer way.

(TripAdvisor’s CPC Cost) Divided into (Reservation Value)*100% = % Commission.

Is it economically justified to invest in the PPC Program on Tripadvisor? Does the ranking have anything to do with it?

Apparently, being in the top results in your city gives you a better chance to pay lower commission (25%), but we need to take into consideration an important factor – the average reservation value. Basically, hotels that rank high are those with higher prices per room, so having the same conversion rate as lower ranked hotels makes the commission lower.

Commission analysis takes into consideration the average of all 58 participant hotels, but we should mention that 22% of hotels (in spite of their ranking) got better numbers in the range of commission between 13%-18%, so the program can be very interesting for them. In some long tail hotels the costs were as little as €38 but they got reservations valued up to €839. A great result, but not very ascendable.

Conclusions.

So what is the key point in the decision making processes about whether to invest in Tripadvisor’s PPC program?

1. As a prerequisite, and as for any investment that will bring traffic to your official website, make sure that it is optimized to convert, offering the potential client the best experience regarding design, reservation engine, rates and also enough room availability.

2. High cost: 25-45% (again, this is related to your position). Compare it with other channels and decide whether the same investment would offer you a better return by other means. If you totally bet on your official website (which will probably collide with intermediation), the costs will be lower. Think that Tripadvisor is enabling the user to compare the rates, so even if the rate is not the only thing to take into consideration, the fact is that Tripadvisor really focuses on it.

3. Limited expenses control: Tripadvisor’s CPC Program doesn’t currently offer any control for the hotelier regarding the amount to invest because it doesn’t manage every account separately but rather in a global way along with other hotels. If you require to budget or control your cost in advance, this could be a problem for you. We hope this changes soon, but nowadays, you will be told the amount you invested by the end of the month instead of at the beginning.

4. The better your hotel’s position is within the pages of your destination, the more chances you will have to receive reservations by this means. Without a good position, it is even possible that you spend your money without getting any reservation at all.

5. It is better if your average reservation value is high. This will soften the fixed cost that involves the “pay per click” concept.

6. If you don’t participate directly, you will be feeding your intermediaries. Check out which of them are bidding. Paying 18%-25% in intermediation means that they are using a part of the incomes to bid in Tripadvisor, which would explain the current phenomenon: “booking/venere/expedia are selling more and more”. They are not going to pull out of the race, even if they pay the same or even more than you, so having a direct presence also comprises a political dimension that you should take into consideration.

7. Satisfy your clients. Life smiles at hotels that do so, and this test confirms it. The new ways of distribution that are arising, such as, Business Listing, and the social network, etc., need happy clients to work. Without their satisfaction, you’re out. Tripadvisor’s CPC, whose return is very sensitive to your ranking position within your city, is a materialised and quantifiable example of this trend of which everyone talks about abstractedly.

8. Trial and error. If you are in doubt, you’d better try it and see the numbers you get. No matter how far we take our analysis: every hotel is different from the rest and there is no way of checking whether this works for you other than trying it.

1) It is relatively fast and simple

It is basically as simple as installing one of the applications that help manage them. When dealing with competitions, the policy of Facebook prohibits the use of the habitual functions of the social network, like the wall or the notes, to do this. In this case, it is advisable to resort to a different application.

There are many companies that develop applications specifically for competitions, offering advantages more than just simple support: to get a database of participants requires clicking on “I like” or providing contact details to be able to participate, counting votes, including a legal basis, establishing a participation method (voting, judging, a mixture of both or a raffle at random), specifying the final date of participation, sharing this with your friends… The action is done like this on an individual page within your profile, which you can establish as a landing page.

2) The fight against the seasons

You can carry out raffles and promotional discounts to raise demand for a product and occupy your rooms at times of the year with fewer customers. The possibilities are infinite: free accommodation for one night, a dinner in a restaurant (making deals with local businesses), a thoughtful gift, 2 for 1 offers, a percentage discount, a free breakfast, etc.

3) Boost the communication between users

For various reasons:

• Many competition applications allow the users to publish their own participation on the wall, increasing the coverage.
• Normally you have the option of getting a file from the applications with the contact information of all the participants that you can use in future promotions. Let the past participants know about new competitions or promotions and aim to generate a database of fans.
• The users can invite friends to participate through a pop-up window.
• There are many communities on Facebook about competitions, which the users can share and request votes.

4) Build on the loyalty of your community

The participants of the competition are required to carry out some type of action: leave a comment, upload a photo, and vote, among others. This brings about conversation between the business and the active participation of the user rather than just accumulating “likes” on your publications. You can take advantage of the attention and the traffic that your fan page receives during the competition to publish information about your product or the offers and discounts you recommend.

Depending on the investment, the size of your public and the difficulty or creativity of the competition, your hotel webpage on Facebook is going to experience a considerable increase in fans and most importantly: How? In contrast to other methods, you achieve valuable information about the most personal likes and desires of your fans, which most likely provides you with information that even the most extensive market research could not have given you.

Just being on facebook is not enough. As well as interacting with the customers that ask questions on the wall, it is important to know how to create a community that will speak about your business and that might even find on facebook a new reservations channel, however, this is not the main aim.

If you think that you do not have enough fans or you would like to have more, to develop your community, try to respond to the next 10 questions and find out if you are doing everything you can.

• 1. Have you suggested the page to your friends?

Within the fan page, in the section “Invite friends.”

• 2. Do you have a customer database for promotional matters and have you invited them by email to become fans?

Take this time to let them know about any current promotion.

• 3. Do you create interesting content and publish fairly frequently?

Go over all the entries in your blog, if you have one, like the relevant content from other sources. Humour and excitement are prone to spread quickly, acting like very effective hooks on social networks.

• 4. Do you make an effort to connect the online and offline world?

Organise events with your customers which brings the social networks into the picture, uploading the photos during the event, providing some benefit or prize to active users of your online communities…and a large et cetera.

• 5. Do you have buttons of the social networks that you participate in on your webpage?

Buttons-link, or “Like” and “Follow us” buttons.

• 6. Do you put the facebook and/or Twitter links as the signature at the bottom of your emails?
• 7. Do you provide the URL of your facebook page on the stationery and promotional material?
• 8. Do you offer some benefit or permanent discount to your customers for using the social networks to carry out an action connected with your business?
• 9. Do you carry out advertisement campaigns on Facebook?

For this, it is advisable to have professional support and advice.

• 10. Do you organise competitions and raffles?

You could build the loyalty, at the same, of your community members. Be sure to use an application that restricts the user from participating without clicking on “I like.”

If you have responded yes to all the questions, you will likely see this reflected in the fairly acceptable number of fans, if not, be patient… remember that it is not so important the size of your community but rather the strength of the bonds between its members.

“Nobody wants a ¼ inch drill…what everybody wants are ¼ inch holes in the wall.” Theodore Levitt.

It is the same with social networks. We do not open a facebook account, we accumulate fans and consequently, everyone speaks well of us on the internet and the reservations go through the roof. To create a community that actually gives value to your business, you have to offer some kind of benefit that cannot be achieved elsewhere. With social networks, the customer has more power than ever before. Achieving this cannot happen without having a business approach completely focused on the customer. We are there to listen to you, to learn what satisfies you, what does not, and to create bonds…

Keeping in mind that assumption, today I want to share 7 suggestions to help you be dynamic with the presence of your hotel in the social networks, as a platform for sharing and providing experiences.

1. Put up a sign in the computer or wireless internet connection area of the hotel that includes a “call to action” similar to “Find us on Facebook” or “Follow us on Twitter.” If you offer your customers free wireless internet connection, it will be easier.

2. Use a welcome page, which your users see as soon as they log on that has invitations to keep in contact with the hotel.

●      Become our fan on facebook

●      Follow us on Twitter.

●      Check in on Foursquare.

●      Subscribe to our newsletter.

●      If you are a minube user, share your experience here.

●      If you are a user of …

3. If you have a Twitter account, use it to increase the satisfaction of your customers. Leave some kind gesture in the bedroom if a follower has twitted his arrival to the hotel and take advantage of this resource to increase customer satisfaction during and after their stay in your hotel. Here you can read a great success story.

Twitter is after all a nucleus of opportunities. You can carry out searches for key words related to your business, such as “hotel madrid” or “romantic getaway”…and find countless twitts requesting recommendations.

4. Look for an original way to  make your social networks known outside the virtual world, starting with a promotional leaflet, your restaurant menu, or something else fun like these:

Surprise from The Westin Bayshore Hotel in Vancouver to a lecturer with some special little biscuits.

QR Code and facebook on the door of the Tailor Made Hotel.

5. Offer your clients some advantage to make a reservation or become fans: free wireless internet connection, free breakfast, a discount, etc.

One night’s free internet for becoming a fan on facebook.

6. Take a chance and integrate technology into your events. We can see the case of a hotel in Ibiza that made use of RFID technology so that guests shared the event on Facebook. However there is no need to incur a high cost. You can simply make sure that there is a photograph and let the people know that you will upload the photos, and even do it at the same time.

7. Organise competitions to increase your number of potential customers, attracted by a prize, and build their loyalty by giving them awards. In this article you can find out more about competitions.

As you must have already guessed, the majority of these actions can be carried out in your hotel without spending a lot. All that is required is a bit of originality and interest in participating in the conversation. The humour and the game control the tone of the message in the social networks and have the ability to expand quickly. If you have still not ventured into the world of the social media…Take a chance!

This actor has something to offer:

The critics have been talking about its appearance for months. Rumours started a year ago when ITA bought a massive platform that provides it with flight inventory. With this purchase it confirmed its intention to take part in the lucrative series of tourism and that it was going to prepare for the great role in the series: the smart Google Hotel Finder, in this case with hotels (at the moment only for searches in the USA).

Its first appearance on stage has not let anybody down. It remains faithful to its style with a minimalist screen presence which is clear and at the same time looking for that special relation with the audience. At the moment is also totally ads-free. Its character promises you that it will find hotels for you, and that is exactly what it does, with discretion, without any complications and with the speed and agility that have become synonymous with all its previous performances.

Don’t be evil: Will it be the goodie?

Google doesn’t like playing evil roles. “Don’t be evil” is its informal slogan. That’s what it says in its code of conduct. However, it’s got into a series where the characters have totally differing interests but are connected at the same time. How will it translate its good intentions? Will it try to keep everybody happy? Will it just simply fall into its place without shooting anybody or threaten the status quo among the cast? …difficult. To make things even more complicated and adding some excitement, Google already has its own interests, and preserving them will be its own personal challenge: especially Adwords, a very important element of this series.

In the last episode of our soap, the audience was mainly focusing on the torturous love-hate relationship between the two main characters of the latest season: the hotel, eager to get the maximum number of people sleeping with it every night, and the superhero, Booking.com, that also competes wholeheartedly for the love of the client and is more successful at getting it, especially because it manages to get the customer’s loyalty.

Will it ask for commission? Will the hotel end up paying it?

What makes it stand out from the others is hat the Google actor lives off publicity, not off commissions, and what it shows at the moment is the prices as “Ads”. These ads are a new system that Google is testing specifically for hotel prices. At the moment, it only gathers data from the big middlemen, without showing directly the prices of the provider.

The mere fact of charging money for being able to show the price, even if it’s unbiased, it’s not good news for anybody. This situation contributes to perpetuate the eternal system of multiple levels of middlemen, with every one of them asking for their slice of the cake. At that moment the hotel pays Google through the commissions to the middlemen. The innovation of Google Hotel Finder is that it could open the doors to opportunity and hotels could pay directly to be able to display their own pricing. Great opportunity, but at the same time it goes against the possibility that direct sales could be cheaper.

Will it end up as being just a cameo role or will it end up being the leading role?

From its first performance that made of it a star, with the legendary role as search engine, Google has taken on many other roles: some of them have been great successes (Gmail, Adwords, Android, Maps…), others were great flops that it had to let go for lack of audience (Wave, Google Video…).

Google tries everything, its filmography with many small roles is larger than what most people would imagine. Google itself introduces them with Labs.

Will Google Hotel Finder make an impact and consolidate itself, or will it end up as a forgotten curiosity? At the moment, Google has been clever enough to label this new performance as “experiment”, although that doesn’t mean a lot. Gmail spent years as a beta project and when it moved on from this status, not that long ago, it was already one of the main email platforms.

The leading actor up to now… threatened?

Of course, Booking.com appears also in this episode with its price and its link. Booking.com is already a seasoned actor used to perform its best in any scene. In fact, one of the reasons of its popularity is that besides being good in its individual performances (for instance, in the page Booking.com), it also captivates the audience with its cameos in third parties ventures like affiliates or metasearch engines. It wants to be in all the scenes and be victorious with all its superpowers (for instance, with the minimum price, that it obsesses about and it’s making the hotel hate it because it’s taking advantage).

Others compete with similar roles

It’s the group of comparison sites or metasearch engines: they work as a directory for hotels, price comparison websites and they point the audience towards the superhero-middlemen.

It seems as if Google Hotel Finder is not offering the audience anything new than other less important actors hadn’t already tried, like Kayak or Trivago among others. The only significant difference is the prominence that the hotel’s website gets from Google (Kayak did show a link to the hotel, but only if it didn’t have any other source).

Everyone of them displays different styles and nuances, Kayak prefers a lot of information, while Google prefers simplicity and Trivago markets itself through its omnipresent TV trailers, but in essence they are fighting for the same character. Why is it expected of Google to get more attention than the others have got so far? Is it using its brand name to attract the audience?

And our man, the hotel’s website?

The new episode starts with good news: Google seems to want to make friends with the hotel’s website and it gives it a permanent space that won’t go unnoticed by the audience. Let’s hope that those good intentions will be fruitful in the next seasons also displaying the prices. That would be something totally new up to now on stage.

Where are the old stars?

Having in the series such a young and attractive actor as Google reminds us of the leading actors of previous seasons, that disappeared off the stage a while ago: tour operators, GCSs and physical agencies.

We know that they are still successful in summer-cinemas and tourist resorts. They are fighting back and threatening with coming back with successful urban ticket sellers, even with superheroes roles. They seem to be very sure of their superpower: “value added”. However, at the moment the script writers don’t have a space for them. Totally normal: the last episodes have been shot in areas that are totally alien to them. SEO, SEM, social networks…

What can the hotel do?

As you can see, there are more questions than answers about the future of the series, but it hasn’t been written yet and nobody knows what’s happening, At the moment, it’s only present in American screens for hotel searches in that country. It’s expected that it will be released in Europe in the next few months. While we wait for it to arrive, the hotel can prepare itself in two different ways:

• Making sure that it has filled out the information and optimized Google Places, a platform that is being increasingly used to identify and gather information from the companies.
• Thinking about an issue that many hotels find difficult to consider: Direct sales are getting cheaper and cheaper. Google Hotel Finder forces you to think about it again. Is the hotel ready to invest to appear directly paying the same as for appearing through middlemen? Probably, many hotels will comply, however the believe that direct sales carry low costs is cracking up. It’s a totally new mentality.

A well-known story for hotels: Powerful middlemen that dominate the market and put pressure on the hotel manager to lower the prices and increase the commission. Before it was the tour-operators, now it is Booking or Expedia, that have managed to continue with the same model adapting it to the new ways of doing things.

However, they are not really interested in having innovation break the structure of the market. As long as it is the middleman who is in charge of deciding what the innovations have to be, these changes won’t do away with middlemen.

Starting this year, the new episode in the series is called Expedia-Groupon and Booking-Facebook.

Many hotels have already received a call from Booking to participate:

Expedia has come to an agreement with Groupon, a web that is quick-growing and bases its activities on the hope that users register to receive their offers. The special feature of the site is that they send them out in vouchers.

Booking.com has launched Flash Deals: 50% discounts only for Booking’s fans on Facebook. They have already 183,000 fans as I am writing.

It doesn’t matter how advanced the new social networking platform, online vouchers, etc look, there is nothing innovative about the market model. It’s the same vicious circle:

1. Hotels need clients, many and every day
 2. Middleman offers clients and the hotel accepts them happily
  3. Clients are never enough. There are many beds, the year is long and the fix costs put pressure
   4. Middleman offers more clients in Exchange of more commission and less money
    5. The competing hotels also need more clients and they also accept the offer
     6. Hotel competition is forced by intermediaries by price lowering and the commission raise.
      7. In the short term, this works, it gets them more guests, stolen from the competitors
       8. Client base doesn’t grow because the other hotels react and do the same thing
        9. The hotel pays more and more to the middleman to find it clients
         10.The clients get the message: if they want to book, they have to do it through the middlemen
          11. The middleman reinvests the huge commission in marketing and making himself visible
           12. The hotel doesn’t invest the same amount to do the same things to promote itself directly
            13. The middleman, fed by the hotel, increases his market share
             14. The hotel loses market share on direct sales, because it can’t afford the same level of investment

This free-fall operation is as valid now as it was 30 years ago with the market dominated by the tour-operators, now substituted by the allegedly sophisticated operations of Booking and Expedia. The Expedia-Groupon vouchers or Booking’s Flash Deals are not going to save any hotel from the free-fall, on the contrary, they are likely to push them down. In the past, the middleman invested its mark-up in brochures, traditional ads and commissions for retail. Now Booking and Expedia use the commissions they get from the hotels to pay for Adwords, SEO and affiliate and loyalty schemes. New names for similar actions.

Great ideas are not that great after all.

The different middlemen that have been present in this sector throughout the years have always found an innovative excuse to convince the hotel that the next step would be up instead of down. Time has come to prove that the so called technological revolution has only benefited commercially to those more astute middlemen. The hotels, years on, are still as subdued as usual. Some examples of false revolutions:

• “Selling on the internet”, just like that. An allegedly great and liberating technological advance. Many online agencies sold this idea successfully as the next push that no hotel could turn down. 15 years on, the same old dependence pattern has emerged in the new platform, the price is still low and the commission and dependence have been increasing.an

• Opaque prices: The attractive in this case is an invention that avoids the loss of prestige of showing the public a superdiscount. Isn’t it the same argument that used the tour-operators when they hid the superdiscounted net price of the hotel in holiday packages with flight?

Every one of these ideas has had some special condition that has made it slightly different and that has helped ease the hotel manager’s conscience when having to lower the price and increase the commission for this new way of distribution. Besides, there is always a powerful argument behind “Going with the times”. What happens if I stay behind? What would happen if my competitors do it and I don’t? What happens if it really works? And of course, it does work in many cases… short term.

Now, “going with the times” is vouchers and Facebook through Expedia and Booking.

Their attractive is a common concept for both cases. They only distribute to “registered users”, which would justify being able to get lower prices than those that are public. This is what Booking tells the hotel, “give me superdiscounts, because they are confidential.” It’s a double trap:

• They are asking the hotel to break their price policy in their favour, when they don’t want it to do the same for its direct sales.
• For users, registering on Flash Deals is so easy as clicking “I like it” on Facebook, calling them confidential would be a joke.

The good news

Not everything is black and dark in this situation.

Probably, Flash Deals or vouchers are successful, but only in moving clients from one hotel to another. Fortunately, a quick check of the participating hotels shows that there is hardly any in Madrid, Barcelona or Paris, all the opposite to the huge offer of holiday hotels. Is that proof that traditionally urban hotels are more advanced than holiday ones?

Other reason for optimism is that 20 years ago the hotel did not have any alternatives to the middleman’s dependence, today they do. There is only one thing to do, take a step forward and allocate the same amount or more of financial resources to direct sales than the amount given to Booking and Expedia. Currently, the hotel can do on its own official site the same promotional actions that Booking does:

• You pay Booking a lot to place Google ads. Do you pay the same or more to advertise your own webpage?
• You pay Booking to optimize its webpage and make it user friendly and easy to use. Do you invest and worry equally about your website?
• You pay Booking to redistribute to third parties. Do you do the same on your webpage?
• You pay Booking to be on Facebook and offer the best conditions. Do you have a page on Facebook? What do you offer?
• You pay Booking to continuously target thousands of users with its newsletters. Do you get direct subscribers from your hotel? Do you send them your news and offers every month?

The contradiction

This doesn’t intend to be a criticism of Booking or Expedia, not even of traditional tour-operators. They have carried out a great work promoting our hotels and our destinations and they’ve been successful at making a lot of money off hotels. They have always being innovating and adapting to every new idea and to the different stages of electronic commerce that the tourism sector pioneered.

It’s not either a criticism of the hotels that enter into the game, if they do it consciously and fully aware of the drawbacks. Although I doubt this is the case. I tend to think that it’s got to do with bad decision making in a moment of desperation.

What is a bit more difficult to understand is the contradictory behaviour of some hotel managers; they complain and complain about these middlemen, but at the same time they keep feeding them WITH BETTER CONDITIONS than they give their official website. With this, they only manage to send a message to the user, go to Booking.

Nowadays, the alternative is there, waiting to get the hotel manager’s undivided attention. Analysing this path thoroughly would take many other articles, but this article gives us three rules to follow:

1. Innovate in your direct sales.
2. Allocate it as much or more financial resources as you do with the most expensive middleman.
3. Watch out for those weak spells during the low season. If you give superdiscounts or supercommissions, do it in every channel.

…and if all of this turns out to be very expensive for you, then you should start thinking about any solution based on superdiscount and supercommission.

1. Improve your Google Ranking

Google will read your webpage regularly, finding new content on your webpage in each visit will give you brownie points. Webpages that are updated regularly are rated higher. The traditional sections of your webpage, like your services or your localization, aren’t going to change, so that’s where the blog, integrated in your webpage, will add new content.

Try to set yourself apart from other blogs with similar subject matter. The quality and originality of your content will help it attract new readers. Don’t just talk about a tourist attraction like an encyclopaedia, that’s what Wikipedia is for. Try to find games, interesting and shocking stories and even anecdotes of your hotel. Everything goes, as long as your visitors like it!

2. Increase your visits thanks to social networks like Facebook.

A blog gives readers the chance to share the articles on Facebook with their friends. Besides, if you’re thinking about having a Facebook page or you already have it, you can improve its content by sharing on it all the articles from your blog. This helps increase the number of visits once the articles start being shared on Facebook or Twitter and it helps increase and strengthen your fan base.

3. Get visibility thanks to the events happening near your hotel.

One of the main advantages of a blog is that you can position yourself with keywords that aren’t very competitive and in only a few hours. You can create an article that will be the landing page for those people searching for information about concerts or other events in your area. Offer them exclusive presents and advantages if they decide to stay in your hotel to attend the event.

4. Your Blog: A travel guide for your clients.

Give useful tips that your guests will be able to use during their holidays. You will be a reference point in their travel guide, with maps, hidden restaurants, places that are only known by the locals and really, only quality material that will help your guests to plan their holiday differently to the advice of other hotels.

5. Creation, updating and maintenance at a low cost.

Do you need somebody in charge of setting up the blog as well as a blogger that will take on the job of publishing regularly? On the Internet, you will find sites like loquo.com or many others where you can contact designers and creative writers that could take care of the setting up and regular publication. You can place an ad to find somebody for both tasks specifying exactly what you want.

You can also find companies that deal with the setting-up and publication from day one. Many of them carry out this task as part of a bigger package, the same way we do it here in Mirai, where we offer setting-up and regular publication, in Spanish and English, as part of the package of Search Engine Optimization for hotels.

The name given by a manager to his or her hotel is a key decision for the business.It could make or loose a lot of money for the business throughout the years. This is very important; it should be looked at carefully and, if necessary, with professional help, before taking a decision that will affect the marketing plan for ever.

In the last few years, having a good name has become even more important with online marketing and especially search engine marketing: PPC and SEO.

I can think of two reasons that will make the choice of a good hotel name even more important:

- If the hotel owner makes the wrong choice, then changing the name will be a lengthy, painful and costly exercise.

- Maybe this hotel owner has never before promoted his business using internet search engines. This marketing technique is relatively new. However, this minority group will end up doing it as well, and it may well turn up to be one of the main marketing tools for the hotel. It seems to be an unavoidable market trend. Starting off by giving the hotel the right name will avoid unnecessary problems in the future.

What does a hotel name need to have to make the best use of SEO and PPC?

1. – At least one unique and distinctive word.

Some users will search for the name of the hotel. This is the most likely group to book. With a unique and original hotel name, these users won’t have any problem finding your hotel among the first results.

If the name, on the other hand, is a generic word, the hotel won’t be easy to find as it will be lost among the many other results coming up for the same word, having to compete, then, with thousands of other websites.

For instance, the word ámister doesn’t mean anything in any language, it’s is just the unique name of the hotel Ámister in Barcelona. When you type “ámister” into Google, the only results you will get are related to this hotel. It’s perfect. Results of Google when looking for “hotel Ámister”.

If the name of the hotel is a word that means something else, that’s where problems start. Some examples would be Hotel Gran Vía, Hotel Ramblas, Hotel Inglaterra. If the hotel name is something similar to those, users looking for it will have serious problems to find its website. Google will show results for anything containing those words, for instance, all the other hotels in Gran Vía or in the Ramblas. Google results when looking for “hotel gran via”.

Hotel Ámister will have an advantage when advertising through search engines (PPC): It will only have to bid for the word “amister”, that is its unique name. Hotel Gran Vía, on the other hand, will have to bid for Gran Vía for its advertising. These two words carry more meaning and it’s more expensive because the search covers more terms.

2.-All depends on the general strategy.

Besides being original, the name of the hotel could include another word. If the hotel is going to use a special feature as part of their marketing plan to get a competitive advantage, it would be advisable to include this in the name.

This feature could be something related to the area, some important site, the name of the hotel chain or any other characteristic.

A way to choose this other word could be asking if the hotel is going to invest in Adwords campaigns whose only keyword will be this other word.

If the answer is yes, then it’s advisable to include it. If the answer is no, then on the contrary, it’s better not to include it, as it wouldn’t be a good idea to confuse wishful thinking with actual achievable targets. Will the hotel bid for the words Madrid or Barcelona? (It’s so expensive!). If it’s not going to do it, there is no point in including it in the title.

To achieve this harmony, what better than taking a tip from Nature, where for more than 2000 years the Golden Ratio, has been effective; this means, basically, a number that represents the ratio between two segments – the minor segment is to the major what the major is to the total, having a value of 1.618.

Leonardo Da Vinci , for instance, used the Goldren Ratio when he painted the Mona Lisa. The pyramids in Egypt were also built according to the Golden Ratio; even the Eiffel Tower maintains it.

Can we apply the Golden Ratio in our webs?

We have always asked ourselves the same question and the answer clearly is Yes.

The theory is that by maintaining this ratio in the elements of the web, we achieve greater harmony in the whole, making it more attractive to customers.

So, searching for information online, we found a very interesting post that we decided to follow, employing our own different designs.

Assuming that the resoution 1024X768px is now more widespread, we apply this ration to 960px, which is the standard for a site that looks good without causing problems. So, making numbers we are left, without needing to scroll, with a rectangle of 960px wide by 593px high.

In addition, we know from other studies made on user behaviour, that webs are read from the top left, diagonally down to the right, sing relevance the further down one moves. Therefore the most important elements must adhere to this tendency. By applying the Goldren Ratio we divide the web into blocks:

This generates a logarithmic spiral (similar to the Fibonacci Sequence) which appears in Nature, such as a nautilus shell.

By adding more elements, but keeping to the same ratio we reach the following conclusions:

Having identified the areas, we move on to include typical elements of a hotel website – logo, menu navigation, booking method, photography etc., using as a guide the proportional golden blocks.

To make all this a bit clearer:

It is seen that all the important elements – logotypes, the first elements of the menu of navigation, booking method, pictures etc., commencement of contents and direction – are contained within the spiral.

Applying this more or less to some of our webs, we reach our goal.

Another exercise would be to change the layout of the booking method to measure its effectiveness:

After a good length of time (6 – 8 months) we were able to prove that the conversion is much improved. The total number of visitors to the sites wishing to check availability and prices via the booking.method was 35% up.

Obviously, keeping to the golden ratio is not the only explanation as to why these sites enjoy a high conversion rate, but our experience teaches many hoteliers and friends that these are the webs they like, and which draw the most attention – there must be a reason.