'Data is King but how you use it is Emperor’ - I came across this saying recently and it struck a strong chord with me, particularly when we compare it to the everyday data that relates to how customers engage online and how companies use (or don’t use) this data.
From my own experience of supporting Hotels and Luxury Brands in making the most out of their online strategies, I can safely say that clients that understand the relationship between customer engagement data (data-driven marketing) and their online business performance usually achieve better returns from their online strategy.
‘Ah’ I hear you say, ‘Big Data’ is for large companies and is expensive, my business cannot afford to implement it’. I am not talking about ‘Big Data’, just the data that can be easily gathered from your own website by using or implementing tools that are free or certainly affordable. In this article, I am going to discuss some of the top areas of your overall Internet strategy that you can use data-driven marketing to greatly improve your customer engagement and, therefore, your online performance.
Most people find good visual presentation improves their capacity to make decisions when purchasing a product online. Most business drivers know this, yet how often will the customer arrive on a rooms section and the hotel presents just one page for rooms with just one image, or, if there is a page per room category, they present just one image for each room. Can we even trust that this image is from the room category? These room sections also often present a detailed list of room amenities, yet the average online customer doesn’t engage with a high level of content, particularly itemised lists.
Companies that take the time to really understand how their customers engage with their product end up having well laid out room sections, with multiple room images, very little content and clear call to actions for bookings or enquiries.
Top Tip: Monitor the movement of customers on your website from the key visual areas (i.e. for Hotels, this is the Rooms section and Gallery sections). Greatly improve the imagery that sells your product and see the results improve. You don’t need expensive or ‘Hero’ images, just good professional ones; 4 per room category would be ideal.
Forrester predicts that video ads will account for about 55% of the total online display spending by 2019. This is driven by the key fact that video engages the customer like no other medium.
However, it is tricky and getting it right needs to be planned. Most hotels do not use video to promote their product to their customers and, from feedback from our clients, they feel that it is difficult to get it right, too expensive, hard to get a good videographer and basically they cannot afford it.
Video is now a key player and every company that is looking to improve customer engagement will need to invest in it. If you do your research and understand the customer, it does not have to be expensive. Embedding condensed video is an excellent way to present your company’s corporate video, while conforming to Google’s Page Speed requirements, Cinemagraph is also a great way to produce stunning animated gifs from good video content. It is also a lot smaller in size than video.
Top Tip: Keep your product video less than 1 minute, if you use testimonials, you can push this to 1.5 minutes. Customers are more likely to view 3 ‘1 minute videos’ consecutively over watching 1 ‘3 minute’ video.
Most business drivers are aware that over 50% of online visitors are now engaging on mobile devices and this is growing. Tablets and desktop use is reducing. Approximately 25% of online bookings are being driven by mobile users and this will also continue to increase.
The mobile customer’s needs are different to the desktop user and, therefore, the mobile website needs to reflect this difference. However, most companies continue to focus their digital strategy almost exclusively around desktop and haven’t invested in fully understanding how (or why) their customers engage with mobile. While there is no doubt that the desktop website is still the most important revenue channel with over 60% of all online sales, not understanding the exact needs of mobile customers can be an expensive mistake.
Presenting a smaller version of your desktop website is no longer sufficient if you want to properly satisfy your mobile customer. Mobile is different and its customer needs are different. The key here is to spend some tome focusing exclusively on the mobile customer: Research their engagement behaviour by inserting heat mapping or video analysis software to clearly see what are they clicking on. Implement A/B tests and event tracking to measure how different presentation of imagery/content can influence different engagement behaviour.
Top Tip: Make sure your mobile booking engine is responsive and design your website, email campaigns, etc. keeping the mobile user to the fore but also recognising that many customers research on mobile and move to their desktop to book.
4. Email Marketing
Most companies that engage online have an email marketing strategy. In the main, this often comprises of 1 email campaign sent to all contacts, an average of 1 per month. From experience of monitoring email campaigns, it is unlikely that this will bring results and our findings show that campaigns like this generate less than €0.05c per contact per campaign (i.e. if you have 20,000 contacts, this generates less than €500 per campaign), where top performing campaigns generate 10 times more.
Companies that just send out campaigns without understanding how their customers engage with their content, do not understand the importance of the key signals or Call to Actions that motivate a customer to engage with you.
Top Tip: Measure open rates, click through rates, opt-out and online revenue for each campaign. Make changes to your subject line, content and imagery and see how these changes affect these rates. If your engagement rates are low, it is amazing how quickly you can improve them by focusing on your customer engagement rates. Useful also to move anyone who has not opened 5 or 6 consecutive campaigns to a separate segment and instead of sending monthly emails, design a more engaging campaign to this group and send it say once a year).
A good PPC management program built around your brand can re-capture a lot of your customers back to your own website, and deliver very good ROI for you. In Aró, we recommend a ROI of 15:1 as the minimum for successful campaigns and average 23:1 across most of our client campaigns. This means that a client receives €23 in direct bookings for every €1 direct spent on online PPC. Even when you take the agency fee and the commission fee or transaction fee into account, a 15:1 return guarantees that you are performing much better than the 18% or higher commission rate you are paying OTA’s. A lot of hoteliers are aware of this, but very few look to maximise PPC ROI.
Another common issue resulting in reduced performance is limited PPC budget. Some Hotels tend to stick to their agreed budget and don’t look to push for higher results. I can understand that if you categorise the PPC spend as an annual ‘Budget Item’ that is typically locked down for the year and can be hard to increase. However, to a company that focuses on maximising ROI, we see tend to see this as a commission budget. Take for example, if you are receiving say €12,000 for a spend of €600 per month (20:1), why not push the budget to €750 and if you can maintain the ROI, your online revenue will increase to €18,000.
Top Tip: Engage a good agency that has a proven track record in maximising ROI. Maximise the ROI from your campaign using your current budget, increase this budget until the ROI starts to drop. This will tell your ‘sweet spot’.