The next big online hotel revenue engine has arrived: Google Hotel Price Ads (HPA)

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There are a number of digital marketing initiatives that drive direct bookings, additional revenue, and high ROIs on the direct online channel, such as SEO, SEM, email marketing, and media. in line. Over the past few years, several new revenue-generating digital marketing initiatives have emerged that, until recently, were only available to OTAs and major hotel brands. Requiring sophisticated CRS access, ad middleware technology, and out-of-reach minimum monthly spend, these initiatives were traditionally inaccessible to independent properties, small and mid-size hotel and resort brands, and casinos.

One of those revenue-generating opportunities is the Google Hotel Price Ads (HPA) program, made up of sponsored price lists that appear across the Google universe: from Google Hotel Finder to Google+ Local (formerly Google Places), Google Maps and the traditional search engine results pages (SERP). These advertisements feature drop-down price menus that allow users to compare prices by price; each ad shows four providers and their rate per night. Each click on an ad in the pricing menu results in a lead generation fee paid by the advertiser in the form of CPC (cost per click), which varies depending on how much the advertiser is willing to pay for the lead. .

Google HPA only works if there is:

  • A real-time inventory availability and pricing feed structured specifically according to Google HPA requirements
  • A dedicated advertising budget
  • Advertising middleware for:
    • Structure and translate inventory availability and flow into “Google speak”
    • Manage daily and monthly budgets by property, campaigns and auctions
    • Track conversions
    • Provide alerts and reports

Google HPA is not a distribution channel, nor a “set and forget” initiative – it requires daily bidding and ad spend management and optimization. It is part of a new digital advertising trend in the sector: the convergence of online hotel distribution and online hotel marketing. This convergence requires hoteliers to have access to sophisticated advertising middleware.

The HeBS Digital CPC Gateway is one such advertising middleware available today for hoteliers. Google’s availability and pricing flow represents less than five percent of the complexity of this new “hybrid” advertising model. The more complex part is the ad middleware needed to manage ad spend and budget on a daily and monthly basis and by property; real-time CPC bidding management; monitoring of campaigns and continuous optimizations; property level reporting and billing.

In addition to Google HPA, this new CPC ad format is used by Kayak.com, the new TripAdvisor meta-search, Trivago, etc.

Google HPA was originally tested with and only available for OTAs, giving them an unfair advantage over hotels. Later, many big hotel brands joined the program, however, due to technological deficiencies and lack of sophisticated advertising middleware, big brands are being overtaken by OTAs. In more than 60 to 70% of cases, their ads are not displayed in the pricing menus (HeBS Digital Research).

Hotel price ads are mostly served at the local content and search level, where the hotel property’s profile resides (Google+ Local, Google Maps, etc.). According to senior Google executives, “the HPA was designed for independent hotels and for property-level marketing efforts”; however, independent hotels have been largely excluded from the Google HPA program so far.

The good news: Google HPA is now available for all independent hotels, resorts and casinos

Over the past 18 months, HeBS Digital has worked with Google engineers to develop the CPC Gateway, designed to level the playing field between OTAs and hoteliers. Proprietary CPC Gateway connects hotelier inventory and pricing to Google’s system, allowing any hotel or group of hotels to be part of the Google HPA program at an affordable monthly rate. Participation in the Google HPA program generates much-needed additional revenue through the direct online channel and transfers bookings from OTAs to the hotel’s website.

How it works? Properties set a monthly advertising budget as low as $ 250 per month and pay a click-through charge (CPC) for all direct leads. Offers range from as low as $ 0.20 to $ 5 depending on the competition in the hotel’s destination. To date, we’ve seen an average CPC of $ 1 to $ 2.

Once an advertiser is selected from the drop-down pricing menu, the user is taken to the hotel’s booking engine / CRS to complete the reservation. The HeBS Digital marketing team uses the proprietary CPC Gateway to manage the property’s daily and monthly budget and to optimize real-time offers and campaigns.

Each rate announcement menu contains four locations organized by rate, from lowest to highest. As long as two advertisers are offering the same price, auctions can increase their position. However, a lower price would generally be displayed on top of a higher price, which gives hotels more incentive to always operate in strict price parity with OTAs. For example, if two advertisers have the same rate of $ 100 / night, their position will be determined by the higher bid. If one advertiser offers a rate of $ 90 / night and the other offers a rate of $ 100 / night, the advertiser offering $ 90 will be listed above the other advertiser.

Case study: is the Google HPA program a viable revenue-generating ad format?

Our experience over the past 18 months clearly indicates that the Google HPA program is a must have for any independent hotel, resort or casino as part of the property’s comprehensive multi-channel digital marketing efforts to shift the share of OTAs to the hotel’s website.

In the case study below, we looked at the results of a number of 4 and 5 star properties that have been part of the Google HPA program. These hotel customers, located across the country, were among the first to take advantage of this new CPC ad format and increase their presence across the Google network. Here’s an overview of Google HPA cost, revenue, and return on advertising investment (ROAS):

rue ROAS takes into account the savings made by real estate by not having to pay commission to OTAs. Remember that any direct booking for your hotel through the Google HPA program is one booking less than the OTAs.

Across the HeBS Digital hotel portfolio, participating hotels typically generate an average ROAS of 900% to 1,200%. In addition, our analysis shows that participation in the Google HPA program generates on average 3 times more conversions than a traditional Google Paid Search (AdWords) lead.

Conclusion

Fortunately for independent hotels, resorts and casinos, small and mid-sized hotel brands, there are new digital technology solutions that allow hoteliers to participate in a suite of major revenue-generating programs such as the Google program. HPA. In our opinion, Google’s HPA program is a must-have digital marketing initiative for any property that generates additional revenue at a very acceptable ROAS. Hoteliers need to budget for this new marketing opportunity to drive direct bookings and protect their hotel’s presence on Google from OTA hijacking.

Partner with our digital technology and marketing company to see how you can get started with the Google HPA program. HeBS Digital goes above and beyond to deliver ROI on every dollar and focuses on new initiatives like Google HPA that generate additional revenue and shift market share from OTAs to the hotel website.

About the authors and HeBS Digital

Sue Wiker and Sara O’Brien are heads of HeBS Digital, the New York-based hospitality industry’s leading full-service digital technology and marketing company (www.HeBSdigital.com).

HeBS Digital has pioneered many of the best practices in hotel digital marketing and technology, as well as direct online channel best practices and strategies. The company has won over 250 prestigious industry awards for its digital marketing and website design services, including numerous Adrian Awards, Davey Awards, W3 Awards, WebAwards, Magellan Awards, Summit International Awards, Interactive Media Awards , IAC Awards, etc.

A diverse client portfolio of leading leading hotel brands, luxury and boutique hotel brands, resorts and casinos, hotel management companies, franchisees and independents and CVBs benefit from the Direct line channel strategy and digital marketing expertise from HeBS Digital. Contact HeBS Digital Consultants at (212) 752-8186 or [email protected]

ABOUT NEXTGUEST

NextGuest provides hoteliers with everything they need to thrive in the digital world, with bespoke technology solutions developed to meet the needs of luxury hotel guests, paired with elegant design capabilities that bring brands to life. We combine the power of data with brand discovery to uncover unique strategies that apply to everything from website design, content marketing, CRM, and more. journey. While each of our services is available separately, the integrated technologies, marketing and consulting offerings work together to increase digital engagement and generate revenue for hoteliers, allowing them to focus on what matters most: serving their clients. www.nextguest.com | [email protected]


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