Are you convinced that our support for increasing the direct marketing is only profitable for big hotels?

Let’s take a look at one of our clients: a family-run garni private hotel on the island of Rügen with 42 rooms. It only opens seasonally from March to November. We started our Full management cooperation in the middle of last year.

Initial Situation

The hotelier timely noticed that he needed a new website in order to continue being competitive. The website’s relaunch was completed in 2017. The hotel’s sales volume had already been in a tailspin. These complications though weren’t hotel-specific – the entire Baltic Sea region was fighting with similar problems. Our hotel experienced a decrease in its direct online sales’ turnover of 17% in the first half of 2018 in comparison to the previous year. The OTA’s had to deal with an even more dramatic decrease of 45%. It became obvious that one could not run their online distribution solely via OTA’s anymore. Considering shrinking sales carts (467 € vs. 374 €), shorter lengths of stay (4,4 vs 3,8 Tage) as well as sinking ADR (107 € vs 97 €), something had to be changed. That’s how our cooperation started in June 2018.

Specific Measures

First, we started with a thorough analysis of their website and their booking engine. In consultation with the hotel we were able to realize a majority of our specific measures like:

  • a uniform color scheme on the website
  • prominent and permanent placement of the booking button
  • downsizing and logical redesign of the navigation
  • prominent placement of the direct-booking advantages
  • optimization of basic SEO-settings

Based on this we started cost-per-click campaigns on trivago, TripAdvisor and Google in order to move traffic to their website. Subsequently we also updated the portals in regard to content, especially graphical material.

Results

Revenue hotel website

Sales via the hotel’s website improved significantly. Even though the first half of the year presented quite a decrease, together we managed to increase the direct online sales’ turnover by 35% in the fiscal year 2018. Keeping in mind that we only started our cooperation in the middle of the year. By significantly improving the website the previous year, the hotelier had offered us the perfect conditions for the launch of our direct marketing campaigns and for a meaningful conversion of the increased traffic.

Here an overview of the most important numbers:

  • The second half presented an average monthly revenue growth of 77% in comparison to the previous year.
  • 46% of bookings via the website in the second half of the year can be accredited to the marketing campaigns initiated by us.
  • The OTA’s experienced a decrease of 4% at the end of the year. This sales channel could have on no account buffered the tailspin before the beginning of our cooperation.
  • The utilized marketing budget amounted to an average 8,7% of the total direct online sales’ turnover.
  • The overall operating costs (incl. myhotelshop fee, website service & hosting as well IBE) amounted to an average of 15,3% from July to December.
  • The website’s turnover was increased by 35% in comparison to the previous year.

Outlook

This year we want to push this amazing positive development. Main focus is on additional measures for increasing the traffic on the hotel’s own website. In addition to trivago, TripAdvisor and Google, the hotel will be connected to other platforms as well. Thus we also plan to expand the existing Google Ads Brand campaigns by a generic one. The possibilities for an improved display of voucher orders will be tested. The use of newsletter marketing is supposed to be boosted for a further increase of the direct marketing. And we are also discussing updating the infrastructure with a newer version of the IBE.