An unapologetic look at Hospitality

@HospitalityStat

May 13, 2011 · Leave a Comment

That list of Twitter updates over to the right of what you are reading, is my attempt at collecting interesting stats on the “social hotel industry” (or: how the hotel industry is using social media). I am a geek and I automated most of it. Sometimes that goes wrong… It just did for TripAdvisor. The cobbled together stuff I use to grab information from TA went on the fritz. On my other site, I am explaining in just a bit more detail what the heck happened.

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No Vacancy 2011 – Social Media is a scam!

April 22, 2011 · 1 Comment

On March 23rd the No Vacancy conference was on in Sydney, Australia. I was supposed to go but instead I got stuck in the office dealing with real business. You know how that goes, someone has to stay behind making sure service to our customers isn’t interrupted. I was stuck following the events through various live-blogs, Twitter and the likes. What follows are a few highlights of #novac11 as seen through the eyes of an absentee.

William ShatnerFinding himself amidst several key-players in the socio-sphere, I couldn’t help but think that Mister Glenn Fogel of priceline.com should have gotten the price for gutsiest performance. Either that, or he doesn’t know what he’s talking about. Given that you don’t just become EVP of a company that large on good looks alone, maybe there is something he knows that we don’t. But to paraphrase, he called social media people scammers. Hmm! As the Web In Travel folks asked on their Facebook page. Did he say that out of fear or conviction?

The exact quote got somewhat lost in the shuffle for me (that in itself is an interesting side-effect of social media). Web In Travel used the term charlatans, while the Tnooz live-blogger Graham Robertson quoted Fogel as saying,  “No one understands if social media will work out. They are hucksters trying to steal your money.” Hmm times two!

To be fair to Glenn, he seemed to have mostly been talking about buying advertizing space on social networks. I am with Glenn at least on that one.  I don’t think an ad on Facebook will ever be more than marginally successful. In the greater scheme of things however, saying that no one understands social media flies directly in the face of soc. media success stories. A few of which being told at #novac11 that very same day.

Take for instance Accor hotels putting TripAdvisor reviews right on their own web site(s). That is a bold move! And it’s not just some test in a backwater market where nobody ever books a hotel either. During #novac2011, Accor’s Australian VP  Simon McGrath explained that Accor saw a booking increase at properties with lots of review traffic compared to those with less reviews. When asked why Accor didn’t use their own review system, McGrath’s answer was that TripAdvisor, as a third party, had much more credibility.

In the end it’s simple. Who do you trust? William Shatner or your neighbor?

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RevPAR or RevPAT (Revenue Per Available Tweet)?

April 19, 2011 · Leave a Comment

Ok, I’ll admit the title is nothing if not totally misleading. But now that I have your attention, I want to talk about Twitter. You see, from a traditional marketing perspective Twitter may not at all be the “wunderkind” that some people have you believe.

Matter of fact, it may very well be the biggest waste of time in your marketing efforts. Research shows that only 29% of all tweets get a response in either a retweet (RT) or a reply. What’s more, of this 29 percent most all activity occurs in the first hour. In other words, if your tweet is more than an hour old, it might as well not exist.

You could say that not every tweet you write requires a reply or a RT, but it stands to reason that the lack of replies after that first hour is a direct result of how people use Twitter. They just don’t scroll back that far! Translation, you need a 1000 followers to reach 250 of them. All of a sudden your 100 followers don’t seem quite so impressive, do they?

Twitter is a broadcast medium, more so than any other social network. But it is a social network, and not the classifieds page. To keep people’s attention you need to offer something that is worth reading. Of course Twitter isn’t a complete waste of time (like I said above) but you have to be really careful not to be a waste of time. So if every 2nd or 3rd tweet you write goes something like “When you are in Savannah, why not stay with us?” (provided of course your hotel is in Savannah) you are not going to get much out of Twitter.

I once heard a hotelier say that tweeps (twitter users) follow hotels because they want to be kept up-to-date on good hotel deals. Really? The only way that Twitter will work for you is if you can clearly define the marketing goal that you expect from Twitter. Do you know what your Twitter=ROI is?

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Rate Parity, again!

April 19, 2011 · Leave a Comment

Here is more evidence that, in general the public doesn’t understand rate parity at all. My question is, why should they? Shopping for the best deal is second nature to human beings. So much so that the not entirely dumb guys at the Guardian (the UK news paper) remain clueless as to what the hotel industry is trying to accomplish.  Read, and weep! (or rejoice as the case may be)

Are price comparison web sites sill a good deal?

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Youtube for hotels

February 22, 2011 · Leave a Comment

Why would I want to sit through hours of silly cat videos? Another dog on a skateboard?  Or your buddy hurting himself really bad? I don’t even know the guy! When Jackass (the show) is on TV, I change the channel. Why would I want to see the same thing while at my PC?

If that is the state of video-sharing web site www.youtube.com according to you, it might be time to give the it another look. YouTube gets more than 200 billion views a day. The average user spends 15 minutes on the site. Every minute, 24 hours worth of video is uploaded to YouTube. Every minute! So while you have been reading this, another 24 hours of video got added. And you aren’t even at the end of the article yet!

So is it all crap? You bet! 99 percent of it is total rubbish.

Just kidding! It’s just like anything else on the Internet, You take what you can use and throw away the rest. Luckily, YouTube is owned by Google, which means that it has a killer search-engine. I sometimes use YouTube to look for hotels I DON’T want to stay at before booking upcoming travel.

And that of course is where the problem comes in! As with all user-generated content, who is in control of the message? Surely, you don’t want to be THIS cruise-line where the bathroom sinks spew brown/yellow-ish water (it’s hard to argue with a video that got OVER 22 thousand views) and is being called “ghetto” by the creator of the video.

Unlike your web site that will eventually get indexed by the Bings and Googles of the world even if you do absolutely nothing to expedite that process or your SEO, on YouTube you HAVE TO work at it. No video, no search results. That wouldn’t be so bad were it not for the fact that any John Doe with a camera can upload a video. And he might just upload something to put you in a very negative light. If you own a hotel by the airport in San Jose, don’t type “Worst hotel ever” in YouTube’s search box, or you might find a video of (one of) your rooms like the 11 thousand viewers before you.

Not that there is that much wrong with the hotel room in that particular video, but you don’t want to have your name associated with those search terms. The reason why should be totally obvious.

At the very least you should be familiar with videos about your hotel that are already out there. So go ahead, hop on over to YouTube and start searching. Your next step should be to reply to any (both negative AND possitive) videos you find. So go ahead get an account on YouTube. But your best defense against negative publicity on YouTube is to upload your own videos. Just like with any search-engine, there are ways to make your videos come out on top in the search results, but that is a topic for another time (and for someone with more YouTube experience).

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Why hotels should care about Foursquare…

January 29, 2011 · 1 Comment

Location Based Services are all the rage at the moment. That is, if you have to believe the iPhone toting hipsters that use their expensive smart-phones to update Twitter more often than to make phone calls. They “check in” to the grocery store, the coffeeshop and even work using applications like FourSquare, Gowalla and Facebook Places. So what is the point?

I drive into a neighborhood, I look at my phone and an app like Gowalla uses the GPS (and network) data to let me know what interesting places (like restaurants or museums) are nearby. I can investigate how many other people checked in somewhere (the idea is that the venue with the most check-ins is the most popular) and see what other people had to say about it. For the ultra-self-important it’s yet another platform to publish every aspect of their existence.

You can also follow your friends and see where they like to go. You could decide to crash your buddy’s anniversary dinner if he is “smart” enough to publish his whereabouts with a Facebook Places check-in.

But while a GPS-based yellow pages with recommendations from friends instead of ads (at the same time allowing me to see where my friends are) makes location based services useful, there is no doubt (at least not in my mind) that the Foursquares and Gowallas of the world get their popularity from another aspect. It’s a game, that is addictive as crack!

Foursquare has over 6 million users and 112 thousand check-ins at JFK (the airport) alone. The Hard Rock Hotel & Casino in Las Vegas has been checked into more than 30 thousand times. Each  individual that checks in somewhere can unlock certain merits for doing so. Foursquare gives out badges (digital ones) and if any one user checks into a place more often than others she is awarded mayor-ship of that venue. I currently am the mayor of the local Target store (as well as 10 other places).

Apart from bragging rights, there are some real perks to being on top of your location based internet usage. Hotel Shangri-la in Santa Monica gives free cocktails to their Foursquare mayor on each check-in. Hotel Murano in Tacoma Washington enters anyone who shows their Foursquare check-in at the front desk into a drawing for a free night stay (and I like to think they decided to do so after something I said on Twitter). One more example:  Oporto (an Autralian fast-food chain) offers specials — usually a free upsize — for every fith check-in.

Don’t think that these location based services are just for kids with too much summer vacation time and a cell-phone plan paid by mommy and daddy.  A study shows that the large majority of Foursquare users is over 25 years of age, has a disposable income of over 25K a year and a large portion of them has at least a Bachelors degree.

I would say that makes it a very important demographic for the hotel industry. Also, looking at the check-in stats for your own property can give you more insight to your guest’s behavior. The hotels I have been looking at on Foursquare seem to (mostly) share a 2:1 check-in ratio, or two check-ins per person. What that means can only be verified against your own sales data, but here is one possibility…

Your average Foursquare guest (but don’t forget to check Gowalla and Facebook Places) is in town for one night and checks in upon arrival and once more before checking out. That being the case, you mayor (if your property has one) needs to have checked in at least three times in the last 60 days, because a mayor needs to have at least one more check-in than everyone else. After verifying that the mayor is not one of your employees (and for CRM purposes it would be good to request them to NOT check-in at work) you should offer your mayor something extra.

While most users automatically let their location based activity  flow to Twitter and/or Facebook (so that is free advertising for you) upping the ante a bit with a personalized offer may just get you an extra mention on these sites. In this day and age, where peer recommendations are becoming the de facto standard for buying decisions, that’s word of mouth that your biggest (traditional) marketing campaign can’t buy you!

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Rate Parity, what the hell is that?

January 28, 2011 · Leave a Comment

This article first appeared on jeroenschouten.com

In the hotel industry (I work there) the big thing at the moment is rate parity. What that means is this, if you sell a hotel room you want it to be the same price on say Expedia, Orbitz and your own web site. This, is to not confuse the customer the hotel says. Everywhere they look, same price. Cool!

Easy for the consumer, bad for the industry. If I am buying a TV, I shop around. I might find that the Samsung I am wanting is is 2500 dollars at Best Buy, 2359 at Target and only 2200 at Amazon. Why would I buy it anywhere other than Amazon? Well for starters, Amazon has to ship it to me. Not only do I have to wait for the thing to arrive, it’s now also going to cost me more money (IN SHIPPING). At Target I can pick it up today. However they are not a dedicated electronics outlet and their service is just not as good as Best Buy.

Should I decide that I really just want a second TV in my kitchen for when the world cup is on, I might go to Target. I have the option… Back to the hotel industry. Let’s replace the word Samsung above with Marriott. Let’s also replace the words Best Buy, Target and Amazon with Travelocity, Orbitz and Expedia respectively. You would think it works the same way… Marriott (the supplier) wholesales a room for 100 dollars. It’s now up to the retailer (Expedia and them) to decide what the mark-up on that room is going to be. Right??

Wrong!! The OTAs (that is what those web sites are called; Online Travel Agents) demand rate parity. If Marriott gives a room to Expedia for 100 dollars (that’s the retail price) then Travelocity also wants to sell that room for 100 dollars. Fine, but Expedia says my commission is 20 percent so Marriott, wholsesale me that room for 80 dollars. Well… says Travelocity, I don’t care what Expedia says we charge 30% commission so you better be selling me that room for 70.

I am not an economist, but it seems to me that something clearly is broken here. As far as I know, in every other industry in the world the supplier (Marriott) sets the wholesale rate and the retailer (Expedia, Orbitz and all them) sets the mark up and thus the final price. If Sanyo sells a clock radio to Walmart for say 10 dollars wholesale then Target needs to buy just as many of them to get the same wholesale discount. Otherwise Target is going to pay 15 dollars to Sanyo.

Not so, when it comes to hotel rooms. And to me that seems wrong. If a retailer says to me I want to mark up your TV by 100% and therefore you have to lower your wholesale rate otherwise I can’t stay competitive… I say go screw yourself! Take a lower profit! I know what it costs to manufacture that TV. Hotel owner, do you know what it costs to manufacture a TV?

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One loudmouth does not a mob make…

January 28, 2011 · Leave a Comment

DISCLAIMER: This article does not represent the views of the company I work for nor any of its employees. They are mine and mine alone. In other words, it’s an opinion piece. Take it or leave it!

This article first appeared on jeroenschouten.com

With that out of the way… Some of you may be aware that I work in the hospitality industry. The company I work for specializes in competitive analysis. In short, that means we spy on hotels on behalf of competing hotels (that’s the best explanation I can muster in half a paragraph). I am also a social media junkie, have given presentations related to social media at several conferences and pretty much live on Facebook and Twitter.

I am compiling stats on social media and hospitality for a presentation I am working on. Looking at some of these, I was reminded of the complaints being voiced by a large contingency of hoteliers on LinkedIn.

While I understand that if it’s your job to make people feel welcome as best you can, you get peeved when one of them starts badmouthing you all over the Internet, it’s really not that bad! At least, that is what the data I am looking at suggests (and may I just add here that it seriously speeds up the research, that a new product we — my company — are working on deals with social media). Keep reading →

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