A new report by L2 “Luxury Hotels: Google Hotel Finder vs OTAs” highlights a shift in the advertising strategies of leading hotel brands as these continue their direct booking battle with the leading OTAs.
L2 analysts find that the reach of the three leading OTAs TripAdvisor, Expedia, and Kayak still far exceeds the independent reach of hotel brands’ platforms.
“The average hotel brand secures only 5% of comparable website traffic, 6% of unique email subscribers, and 14% of unbranded Google search visibility (measured against 1,528 keyword searches).
Google Hotel Finder may disrupt the influence of OTAs on hotel brand visibility, but only with the right targeting and shift in investment.
“Large brands like Hilton and Marriott were able to compete head-to-head with major OTAs in paid results for unbranded terms, and top performer Hilton was able to gain more visibility than leading OTAs Expedia and Booking.com. OTA and metasearch sites still garner significant SEM visibility, accounting for 7 of the 10 most visible brands on unbranded searches. A winning strategy for brands in the unbranded search space is carefully curating search terms that attract core consumers, while ignoring broad top-of-funnel keywords. Ignoring less targeted unbranded key terms frees up budget for second-order search efforts on leading OTAs.”
As Google works to lead the travel search and booking process, Hotel Finder has caught up with leading OTA TripAdvisor on click volume relative to ad spend, which, the authors say, makes it “critical for brands to optimise for second-order visibility and purchase sponsored listings on Hotel Finder.”
L2 finds that hotels have been geographically inconsistent in their advertising, with the bulk of spend going to boosting visibility for US destinations. As a result, if the traveler is searching for US destinations 60% index hotel brands will get at least one sponsored result whereas when the traveller is searching for international destinations only 38% of index hotel brands will.
Another finding on the report is that the change in default display order from rating-based to best value which TripAdvisor implemented in May of last year has somewhat diluted the effectiveness of the advertising on the platform for luxury-oriented brands, prompting greater ad spend.
“Based on the new default ordering, there is virtually no correlation between search rank and the quantity or quality of traveler reviews earned. To compensate for reduced visibility, many hotel brands have increased display ad spend on the platform. Estimated ad spend from the top Index enterprises (Starwood Legacy, Hilton, and Hyatt) is up 63 percent year over year.”
Hotels are pushing forward with consumer awareness campaigns led by the American Hotel & Lodging Association, to encourage direct bookings, and Google is benefiting from the shift.
For example, Hilton after launching its own “Stop Clicking Around Campaign,” had an 18.8% decrease in ad impressions served by TripAdvisor in 2017 v 2107, while Hilton’s ad impressions on YouTube rose by +115.7%, for the same period, according to L2’s analysis.