Should Independent Hoteliers Outsource Their Digital Presence?

The question to ponder on is why a hotel should outsource anything? Be it security, laundry or housekeeping, let alone their digital presence. Outsourcing is counter intuitive to many traditional hoteliers but over the years many have realized that the right specialists can do a better and cheaper job of many functions. It not only frees up bandwidth but brings in more efficiency to support the core function of a hotel – to ensure guests are happy and have a great stay experience.

A couple of decades ago life was simpler. One would open a hotel, get a sales & marketing team, establish a few key relationships with companies and travel agents to get business in. Competition tracking was simple and hotels would bench mark against a few competitors in the city to track how they were doing. The front office managers would exchange occupancy and ARR figures in good faith and things were in nice rhythm.

It got a little more complex when OTAs came on the scene but was still manageable. Customers were booking from desk tops and large American chains like Marriott and Intercontinental pioneered the concept of rate parity. OTAs and Hotels were selling rooms at the same price. Hotels created websites and there was a well established ecosystem of products like Booking Engines and Channel Managers that hotels could leverage to maintain parity.

The big change from those good old days and now is that traveler personae are getting extremely complex. They are searching, getting influenced and booking travel using social media, search engines, meta-search engines and OTAs. They access the web using multiple devices interchangeably – Desktops tablets and mobile phones until finally coming to a decision about the hotel they want to stay in. The companies who are good at understanding this complex user behavior are the ones that are thriving and growing exponentially. The likes of TripAdvisor, spend millions of dollars and countless hours doing AB and usability testing, crunching data and ensuring that they are always ahead of the curve. It is rumored that market leader OTAs run more than a thousand tests a month! It is no coincidence that Priceline and TripAdvisor are valued at USD 58 and USD 12 Billion respectively. The scales are rapidly tipping in favor of intermediaries vs Hotel Direct.

While some may argue that the model of outsourced digital marketing and distribution reduces a hotelier’s control over their brand, independent hotels might not have any choice but to bring on board some specialists instead of preferring the model of recruiting their own teams.

Here’s 3 scenarios when hotel digital marketing should be outsourced:

When Knowledge, Resources & Time Is Against You.
Sure you can get around this by recruiting the best in the market, but you would be surprised at the kinds of salaries you would need to fork out and how difficult it is to retain talent. The best folks want to work for the best companies in their fields just like the best hoteliers want to work for the best hotels.

When you are getting extremely uncomfortable about your cost of customer acquisition through third party channels and want to do something about it.

When you want to experiment with emerging sources of hotel bookings and traffic including social media, Tripadvisor and other meta search channels like Trivago and Kayak and feel that the learning curve might be too steep.

Finding the right partner is the key. Every consultant is a self declared expert on social media, SEO and PPC marketing. Work with someone who is willing to work on a success fee rather than fixed numeration.At the end of the day, hoteliers should focus on their core expertise i.e. running the day-to-day operations of their properties. Having an outside perspective can be invaluable and highly profitable.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s