Hotel organizations in China are undergoing a digital transformation and the cornerstone of their efforts is serving guests through their own apps.
NB This is a guest article by Ritesh Gupta, a reporter for China Travel News.
But at the same time as investing in their direct mobile offer, many are considering engaging with WeChat as a booking channel.
Brands need to be proactive, as its owner Tencent continues to innovate its WeChat product offering.
Established hotel company China Lodging Group (Huazhu) is currently prioritising its own branded mobile portfolio, with WeChat having a specific role.
Last year its mobile web and apps accounted for 40% of total room revenue, and WeChat contributed only 0.4%. The group expects WeChat to contribute 3% of total room revenue by 2017. The current share of WeChat is more than 1%, according to Xinxin Liu, CIO, China Lodging Group.
Liu said that WeChat is currently used to target new customers and get them enrolled into its loyalty program, HuaZhu Club, which has more than 30 million members. These members book 85% of China Lodging's room nights.
And a deeper breakdown show that seven out of ten of these bookings come from its app.
Facilitating bookings via WeChat
For a business with a direct distribution focus such as China Lodging, WeChat bookings are negligible as part of the overall mix. And Liu identified "limitations with WeChat business accounts for messaging or sales promotion, such as the restriction of the number of words.”
But for chains with a different approach, WeChat has a number of options when it comes to direct bookings.
Tony Shen, founder and CEO of Chinese digital marketing specialists Evermotion, pointed out one advantage WeChat provides consumers and businesses is a convenient payment experience which hotels can use to sell products and services other than the room itself.
And there are other WeChat functions that can work for hotels, such as its "Shake" function. Shen said:
“We initiated an anniversary promotion for a hotel in Shanghai on WeChat simply by using the shake function. People who join in the activity would receive a 2-Yuan coupon for gifts. This event drove sales that exceeded RMB100,000 ($16,000) in only a week."
Elsewhere, there are some hotels who are actively selling directly through WeChat and are giving guests strong incentives to do so.
The Kempinski Hotel Chengdu offered a 30% discount to those who booked through its official WeChat account. Guests were also given an option to select a room with one of the following benefits: a free upgrade to the next higher room category, late check-out or a complimentary home-brewed beer, privileged laundry services, and discounted limousine service for airport transfers.
Membership clubs
Shen also believes that the "membership card" option which businesses can set up on WeChat might have some application in the hotel sector. These virtual cards are stored as part of a person's WeChat account and are used when products and services are bought online. This generates points which can be redeemed, like traditional loyalty cards.
Simple things
Simplicity is another WeChat perk. Shen says hotels only need to upgrade or open a WeChat service account and complete certification, and then apply for the WeChat payment API. No other tedious preparation work is needed, he says.
This is easier, he suggests, than having to develop, maintain, and upgrade branded apps for iOS and Android.
“WeChat has the characteristics of lower investment, shorter development cycle and stronger flexibility."
But the specifics of WeChat for hotels are still complicated. China Lodging's Lui pointed out that the sheer volumes of messages a WeChat user gets can be a drawback, whatever function or service a hotel chooses to use. A branded app, meanwhile, has already broken through the clutter as its presence is based on regular use.
See also: Travel firms to need watch WeChat (July 15)
NB: This is an edited version of an article by Ritesh Gupta, a reporter for China Travel News.
Click here to read the original version.