According to the World Travel and Tourism Council, travel
and tourism generated a direct contribution of $2.3 trillion to global GDPs in
2016 and supported one in 10 jobs in the global economy.
More than three-quarters of that spending - 76.8% - is
attributed to leisure travel. It’s a massive market, and one that often starts
with a blank slate: Many consumers begin the travel planning process with a
simple desire to get away, without a specific idea of where, when and how.
For most travelers, the answers to those questions come
through self-directed online research, which they conduct via the web, apps and
social media.
So it’s no surprise that travel brands are spending big -
very big - on digital marketing as they aim to reach and inspire this receptive
audience.
Throughout June, we're looking at a variety of topics under
the umbrella of digital marketing.
For the third installment, we examine one of the oldest
digital channels - email - its evolution and its effectiveness.
Background
The introduction of personal email addresses in the 1990s
created an entirely new opportunity for brands to reach consumers quickly and
cost-effectively.
But what began as novelty quickly became a nuisance for many
consumers as brands began clogging their inboxes with unsolicited, bulk emails.
Hotel groups struggle with sending a constant barrage of offers. You want to make sure you’re not fatiguing your list by oversaturating them with irrelevant content
Lucas Cobb - MMGY Global
Fast-forward to today, and the development of sophisticated
data collection tools and filters have made email a customizable and very
effective component of a marketer’s toolbox.
According to the Relevancy Group, marketing executives in
the United States attributed 21% of their total revenue to email marketing in
the second quarter of 2017, up from 17% in the same period in 2016.
For the travel and hospitality sector, the Relevancy Group
says email is the primary channel used by marketers, and they dedicate nearly
40% of their overall marketing budget to email.
And they are using email for good reason: According to
Campaign Monitor’s 2017 Consumer Email Habits Report, “more than half of those
surveyed in the U.S. check their personal email account more than 10 times a
day, and it is by far their preferred way to receive updates from brands.”
Make it about me
Another finding from Campaign Monitor: Across verticals, the
top reasons consumers will open an email from a brand are personalization and
discounts.
Erica Rich, Revinate’s senior manager for product and
customer marketing, says the best way to fulfill those needs is to frame an
email strategy around the customer journey.
“So you’re thinking about how am I going to connect with
this person during the inspiration stage, how about during the pre-arrival,
being on property, the post-stay and just throughout the entire cycle,” she
says.
Rich says automated campaigns are the most efficient way
to manage these communications. These can include an email that is sent prior
to a guest’s arrival that includes property information and some sort of upgrade opportunity, a welcome message once they have checked in and a “win-back”
offer after checkout.
And by pulling in data from the property management system,
those emails can be personalized.
“Are they a first-time guest or are they coming back? If
they’ve been there several times, the note should reflect that,” she says.
“You can potentially include their name by pulling in
information from the PMS, ‘Erica we miss you.’ That grabs my attention, and then
I open it and read, ‘Dear Erica, the last time you were on property was this
date.’ Or maybe I booked a family-friendly package so I should receive those types
of offers.”
The OTA issue
In the past several years, hotels have become more strategic
about driving direct bookings, hoping to capture business back from the online
travel agencies.
Email has become one of the most effective tools to do that.
As corporate director of revenue for hotel management
company HRI Lodging, Scott Bogucki has found success with sending targeted
messages to guests that booked through an OTA or other third-party reseller.
"A month after a guest checks out we send ‘Hope you
loved your stay. The next time you are traveling here, here’s a link where you can
book direct and save 20% or get free parking or get a free upgrade,’ whatever it
happens to be,” he says.
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Bogucki says this type of email allows them to offer a
discounted rate without breaking the rules of rate parity clauses since the rate
is not published publicly.
“We know OTAs are essential for independent hotels like ourselves.
The customers don’t know who we are until they find us on an Expedia or a Kayak,”
he says.
"But then as soon as we win them over, we try to capture them
as our own. Using these email campaigns allows us to compete in that arena and give
them a reason to book direct.”
And Bogucki is happy with the results. One example: In the
past year that he has been working with Revinate and using this “OTA win-back”
strategy at River’s Edge Hotel in Portland, he says these emails have generated
more than $20,000 in room revenue from direct bookings.
Interpreting the data
As with all digital tools, email delivers valuable data to
marketers that can be used to refine future communications.
By analyzing click-through rates and specific actions such
as whether users clicked on a photo or on a “book now” button, marketers can boost
the relevancy of follow-up emails.
“Hotel groups struggle with sending a constant barrage of offers. You want to make sure you’re not fatiguing your list by oversaturating them with
irrelevant content,” says Lucas Cobb, senior vice president of data strategy
for MMGY Global.
“Use the engagement activity as triggers. For example, if a
user viewed a video on a spa, let’s send them our canned spa promotional
message. That goes as a one-to-one as opposed to a message to a whole list of
people.”
Cobb also suggests using email subscriber data to drive audience
development on social media. For example, using it to filter the audience for
ads on Facebook.
“As much as email is an important communication channel,
it’s also really a feeder into many of the other channels that we are
prospecting.”
Mobile
When social media emerged as a communication channel several years ago, there was speculation that email would fall out of favor. But the development of smartphones changed that. Whereas consumers used to leave their email behind once they stepped away from their desktop computers, now most people have access to email on their mobile devices.
People think millennials won’t be so keen on email because they are the generation of social media but that’s not the case.
Erica Rich - Revinate
Litmus analyzed 15 billion email opens in 2017 and found 47% of opens happened on mobile while only 17% were on desktop.
“We used to debate the best time to send an email, the best day to send an email, but for the most part it’s irrelevant because people are constantly connected," Rich says.
And email is particularly effective with the coveted millennial age group. Campaign Monitor found millennials are more likely to take action based on email than older generations.
“People think millennials won’t be so keen on email because they are the generation of social media but that’s not the case,” Rich says.
“Email just feels a lot less intrusive than social media. And it’s still number one for conversion, it’s still number one for customer retention, for ROI, and it’s higher in engagement.”
Optimizing emails for mobile is important. Cobb says whereas MMGY Global used to send lengthy emails for clients, mobile has changed its content strategy.
“We saw we weren’t getting engagement on those messages. People weren’t scrolling to see all the content. So it forced us to focus,” he says.
Effective emails have strong subject lines and brief text in the body that conveys the value proposition and call to action. Rich also suggest a 40-60 ratio of text to images.
“There are studies that show the word ‘because’ helps you get more click-throughs: ‘You are getting this offer because…’ People want to understand it is really meant for them,” she says.
Bogucki says HRI Lodging uses a variety of marketing channels for its properties - email as well as digital ads, Facebook and other social media - but email has proven to be one of the most effective.
“The numbers speak for themselves. Since we joined Revinate about a year ago we have generated $265,000 in revenue that was related to some sort of email that was sent from our system - whether it was automated or a specific campaign - and that’s just at one hotel,” he says.
“People are still engaging with email. They are still using it. There’s definitely value to it.”