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Press Releases
LODGING INTERACTIVE’S TIPS ON
BUDGETING FOR 2007 INTERNET MARKETING
PARSIPPANY , NJ , SEPTEMBER 6, 2006 – It’s that time of year again, time for those endless meetings, projections, negotiating for the marketing share of the overall budget and ultimately a little praying. How do we expect the hospitality industry to fair in the next year? How much do you spend to target new markets? Will my water park really bring in the projected business? What about that new competitor down the road? These and so many more issues go into your best estimate on what to spend on marketing for the coming year. How much business will the brand produce? How much do you spend for trade shows? Should I renew the sign on Interstate 95? Will another sales person pay off? Am I using my competitor reports effectively, is it worth cost? These and so many more are issues to consider when planning your budget. The one thing that is true is that more and more of the hotel business will be sold through the Internet.
Once you determine what share of your budget will go for marketing, the key question is what percent of your overall marketing budget is allocated for Internet marketing? Some statistics to help you answer this question are:
- 50% or more of all hotel reservations will come through Internet channels in 2007
- 25 to 30% of your direct reservations will be directly affected by Internet information
- 85% of all online transactions include one or more search engine sessions
Based on just these simple statistics, there is little doubt that Internet marketing has to be a significant percentage of your marketing budget. This percentage will, of course, vary based on your location, target markets and seasonality. We know its all about cash flow. If you project a budget with 20% of your estimated income allocated towards marketing, you need to realize a positive ROI on that expense within the anticipated time period. If you’ve made some changes and plan to target a new market it will take time to build, so the time for the return will be significantly longer than a special offer to your existing market. The one fact is that the majority of your room reservations will either come to you through the Internet or they will be affected by what information there is on the Internet about your hotel.
Now, what is in your Internet marketing budget laundry list?
- Additional brand fees or share of revenue percentage for GDS and brand website services
- GDS and Pegasus fees
- Percentage of your average rate that is deducted for the merchant websites
- Commission paid to online travel agencies
- Online advertising and reciprocal links
- Website design, development and updates
- Annual fees for special website features: new photos, comment cards, maps, audio, 360° video, current photos, multiple languages and more
- Website hosting
- Search engine optimization management
- Internet Booking Engine commission or fixed fee
- Pay Per Click advertising costs
- Pay Per Click Management fees
- Email blasts to direct prospects to your website
- Your time and cost for tracking and analysis of results
- Your time and cost for managing multiple rate and inventory channels
- Payroll and benefits for qualified eCommerce or Internet personnel
- PMS interfaces and added modules that are for Internet related services
- Other outsourced service fees
- Time and cost to support a BLOG or community site placement ( www.myspace.com or www.youtube.com)
There are probably a few considerations missing, but I think you get the idea. Take all aspects of your Internet investment, both fixed and variable, into consideration. Ask yourself, can my brand do it all? Chances are the answer is No! The brands sell the brand, not your property. The value in the brand is the perception of the buyer and some distribution and reservation system savings. Ask yourself what you can you afford to keep in house and what has to be outsourced? Then if it is outsourced, who will manage and track the results for that service? What results should be expected, always ask that question.
Your website is your “point of sale” therefore it is critical that your site is ranked on the leading search engines multiple times and for a growing number of search terms. And, when the shopper arrives at your website it has to give the shopper a positive and motivating experience. One that leads to a booking! Oh yea, don’t forget to manage your website packages, rates and availability efficiently. Extensive research on Internet buyer trends tells us that the online shopper wants brief, reliable information from your website. This information is in the form of photos, text and maps. Remember, times and people’s expectations change, so ask yourself if this is the year to update or change your website.
Your bottom line in budgeting once it is completed is not to kick yourself for what you left out or what you wish you had included. Make sure there is enough in the miscellaneous expenses to cover what you forgot. Good Luck!
About Lodging Interactive
Lodging Interactive is a leading provider of Internet Marketing Services to the travel and lodging industries. The company provides a portfolio of effective Internet Marketing Services to hundreds of hotels, resorts, timeshares and bed and breakfasts worldwide. The Company also offers effective online tools and services; hotelBLAST.com, a self-service email marketing system, MyWebsitePromotions.com, a self-service online promotions marketing system, CommentCards.com, a full-service consumer-2-business comment card and survey service, SEOTracker an SEO Analysis and SEO Competitive Benchmarking Service, HotelMASHUPS.com interactive Google mapping services, and eProposal Rapid RFP Response System.
Lodging Interactive clients include branded properties such as Marriott, Sheraton, Hilton, Radisson, Crowne Plaza Hotels, Doubletree Hotels, Candlewood Suites, Best Western, Wyndham Hotels plus numerous independent properties. The Company is headquartered in Parsippany, NJ and can be reached at 973-402-4970 or by visiting its website at www.LodgingInteractive.com , www.MyWebsitePromotions.com or www.CommentCards.com .
Lodging Interactive is a proud member of the American Hotel & Lodging Association (AH&LA) and a supporter of the Hotel Sales & Marketing Association International (HSMAI). For more information you can also contact Richard Walsh, Vice President of Business Development at rjwalsh@lodginginteractive.com or at 973-402-4970.
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