Briefing: Industry unclear on customer acquisition costs

According to Kalibri Labs customer acquisition cost is now upwards of 15%-25% of room revenue.

The shift from direct booking to multi-channel booking means that cost of acquisition has become more of a cloudy issue in hospitality. Businesses must now take into account; fees, commissions, marketing cost, revenue, and effectiveness of each channel.

So which channels overall are more cost effective? Our experts discuss:

The issue of Rate Parity has been contentious between hotels and OTAs. Any difference in the rate offered on each channel certainly affects the overall cost of customer acquisition. Any new channel, be it an OTA, Metasearch site or new entrant that a hotel or alternative accommodation decides to display rooms on, adds new factors and makes cost harder to keep track of. Not forgetting the bookings that still come in through non digital channels.

According to Travel Click, the Average Daily Rate from customer booking directly with a property either in person or over the phone is growing 5.6% in Q1 2016. In Q1, ADR is also growing 4.0% for CRO (phone calls to a brand), 3.3% for OTA, 3% for GDS (in-person travel agents) and 2.3% percent for ‘Brand.com’ (a company’s website).

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do see here. It’s free.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: Demand for data services

A report from KPMG has found that 58% of organizations have difficulties evaluating data quality and reliability. Only 19% say they are currently ‘very satisfied’ with the insights their Data and Analytics tools provide. And only 14% think they have all the talent and capabilities they need to fully leverage data and analytics.

Relevant information and statistics can be provided by data collection or research services, or can be a result of good data systems within a hotel.

In these videos experts discuss services they offer to the hospitality industry and its customers:

KPMG’s report Going beyond the data: turning data from insights into value found that 97% of organizations say they are using Data and Analytics in some area of the business and 81% of respondents have improved their understanding of customers. There are a multitude more ways data can help organisations to make accurate and fast business decisions and sell their product effectively if they are able to leverage data properly.

In 2016 Snapshot will launch a new Hotel Analytics platform. The products is promised to be “Glanceable. Actionable. Effortless.” The platform has need significant investment to build, some of which came from long standing hotel market data & benchmarking company STR Global, and €25 million of which came from China based IT company Shiji Networks. The overwhelming volumes of data in the industry have long been both an opportunity and a headache to figure out. This product will surely appeal to many.

This is one of many companies responding to the demand for clarity of data. As discussed in the above videos UK based research company BDRC Continental provide research to a variety of industries including hospitality. Maxxton provides IT solutions and services. The online travel agents like Expedia have access to a phenomenal amount of data spanning many brands and therefore can gain a great perspective on the industry. And technology companies such as Seranata Intraware provide solutions for hotels to organise their data.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: Upgrading room technology

According to a 2015 Lodging Technology Study, properties last year were allocating nearly 17% of their overall IT budget to guestroom technology. The study also found that 45% of properties had planned to upgrade their wireless in 2015.

Demands on bandwidth are ever increasing as more internet enabled devices are entering the hotel space, and are being used for streaming and other demanding tasks. Guests expect a smooth and speedy internet connection and will become frustrated by a substandard connection.

In this briefing experts discuss hotel technology and demand for wi-fi:

Hospitality Technology’s 2015 Lodging Technology Study highlighted another area where technology is being upgraded – entry to the hotel room. In 2015, 34% of properties were upgrading their room looks to use electromagnetic keycards (RFID keys) or smartphones as keys.

Individual room thermostat controls have also allowed hotels to improve their energy efficiency as it has meant that heating could be off in rooms that are unoccupied. This can also please guests as it allows them to adjust the temperature to one that suits them.

Next Gen thermostats are not the only smart objects appearing in rooms.  According to Travel and Leisure, Starwood hotels can convert any appliance in the hotel room to a smart object, which would be controlled through an app.

Today’s traveller will bring his or her own mobile devices to a hotel, but that is not say their hotel experience cannot be improved with high quality in room technology. The Lodging technology study showed that at the beginning of 2015 15% of hotels were using Smart TVs and a further 16% were expected to add them. These Smart TVs allow the guest to connect to access TV or films that they may have a subscription to through an account such as Netflix or Amazon. 36% of properties planned to add or enhance HD content.

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do see here. It’s free.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: Understanding Millennial priorities

The latest research on millennials from Choice Hotels found that 33% of Millennials would put off buying a home to take a dream vacation.

Holidays remain as desirable as ever. Particularly for this young generation where an opportunity to have a new experience can take priority over other areas of life. The study also found that 12% of Millennials have quit their job to take a vacation or go to an event such as a concert.

In these videos four experts discuss the behavior of Millennial travellers:

Choice Hotel’s study Uncovering the Millennial Mindset looked into the behaviours and priorities that Millennials have when taking a holiday. The survey polled 1,000 U.S. adults, ages 18-65 between September 30 – October 3, 2015.

It highlighted some differences between a Millennial at home and a Millennial on holiday, finding that 27% of Millennials have stayed in a hotel to impress someone and 79% of Millennials say they are more adventurous about eating and drinking when travelling.

The industry has had to drastically change to cater to emerging distribution methods. But tradition has not been shunned altogether, with 35% of Millennials will still turn to the friendly help of a travel agent to make their decision.

Not all the generational shifts are as drastic as the move to online research and booking. The study also found that 61% of Millennials carry hand sanitizer when travelling—more than any other generation. And 30% of Millennials keep earbuds in their ears when travelling so people don’t talk to them.

The study highlights the Millennials appreciation for instant rewards. It states that 69% of Millennials see freebies (such as snacks/sandwiches/to-go breakfast) as more important than opportunities for increased loyalty or reward points. And 43% of Millennials believe that if you do sign up to a rewards program you should receive your first benefit straight away.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

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