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Interview with Max Starkov: Mobile Marketing Strategies.
EyeForTravel.com’s Ritesh Gupta
Friday, 16th October 2009
 

Max Starkov, Chief eBusiness Strategist at HeBS,  spoke to EyeForTravel’s Ritesh Gupta about how travel suppliers should approach and plan for mobile devices—the main idea being budget limitations are no longer an excuse for lacking an inexpensive mobile-ready hotel site.

1. Would it be right to say that mobile still is much more a retention than a transaction channel, and mobile is not to be viewed as a direct commerce channel yet?

Max Starkov: The mobile channel has already become an important transaction channel in the U.S. and worldwide.The promise of “immediate, anywhere and anytime” Internet access, instant information and transaction capabilities, location-based services and personalization are the key advantages of the mobile Internet.

There were 4 billion cell phone subscribers worldwide at the end of 2008, according to the United Nations International Telecommunications Union (ITU) – compare this to less than 1 billion in 2002.

A recent Nielsen Mobile poll found that in 2008 only 9.2 million U.S. mobile subscribers purchased goods or services with their handsets. Yet today, mobile customers are much more at ease with the idea of m-commerce.

How serious is the demand for mobile services in the travel space? A recent report by PhoCusWright projects mobile bookings to reach $160 million in 2010 alone. Sixty-seven percent of travelers and 77% of frequent business travelers with Web-enabled mobile devices have already used their devices to find local services (e.g. lodging) and attractions.

Another poll by Harris Interactive, conducted April-May 2009, shows that 71% of U.S. adults felt that it was safe to make a purchase via a mobile phone. Forty-three percent of respondents are willing to purchase hotel rooms and 40% tickets for travel via their mobile devices.

In other words, hotel guests and travel consumers in general—past, current and potential—are increasingly becoming mobile-ready, and hoteliers and travel suppliers have to respond adequately to this growing demand for mobile services. This is the reason why all major hotel brands, travel suppliers and OTAs have mobile Internet initiatives in place, including mobile brand websites, mobile applications, including iPhone apps, m-CRM and mobile marketing.

2. Hotels have introduced their mobile site to support its guests. Hoteliers say many of their guests live on-the-go lifestyles and are technologically on all the time. How do you think mobile phone functionalities have moved on in the past 6-12 months?

In my view there are 2 dramatic events in the history of the mobile channel that are “game changing”:

  • The introduction of NTT DoCoMo’s i-mode in Japan back in 1999. The i-mode converted the bland, unappealing cell phone from a purely communication device to an interactive, mobile Internet enabled personal tool. And it did this on a mass scale. i-mode users have access to various services such as e-mail, sports results, weather forecast, games, financial services and ticket booking.
  • The introduction of the first iPhone in June 2007.  Apple rewrote the rules of what a smart phone can and should do, and took this device to an entirely different level. The App Store invigorated the collective creative spirit worldwide and now has over 50,000 mobile apps.
3. The choice of hotel for most people is an involved process – location, facilities, brand, price all have a role to play especially when people are choosing their annual holiday. This perhaps makes it more suitable for PC-based browsing. What do you think are pros and cons at this stage which one needs to consider to ensure mobile-related efforts get optimal results?

The  mobile Internet is not wireless access to the conventional Internet. The mobile Internet does not merely duplicate the traditional Web.  Many retailers and travel companies who literally “translated” their conventional websites for the wireless world failed to achieve any significant usage and conversions. Why? The mobile Internet adheres to different rules than the conventional Internet. Mobile users have even shorter attention spans. They have less time to browse and are often on the go. Slower speeds, yet to be perfected mobile browsers, smaller displays, limited data-input capability (e.g. the number of keywords that may be typed in a search), multi-step booking and information retrieval processes are some of the limiting factors.

Imagine trying to squeeze your wide-screen hotel website, designed to fit screen resolutions at 1280×1024 pixels and above, onto the tiny screen of a mobile device. Our analysis shows that more than 90% of mobile users access the hotel website via mobile devices with screen sizes of 320 x 480 pixels. Accessing a “conventional” website via a mobile device, even the latest iPhone, often results in an undesirable user experience: the inability to find information needed, and a predictable outcome of abandoned websites and reservations.

To solve this issue, hoteliers should offer a mobile website specially designed to provide an excellent user experience in a mobile environment.

Mobile users demand mobile sites that download fast, provide short and concise textual content with no fluff, minimalistic visual content, and navigation that is straight to the point. Efficient and simple navigation is of particular importance so people can easily find short descriptions of hotel amenities and services, maps and directions to the hotel, a toll-free phone for information and reservations, and an easy-to-use, basic booking engine.

4. Airline mobile web services have centered around making available flight schedules, fares, plus destination and airport information for all mobile phone users. How are travellers typically using airlines’ mobile web services and what are transaction-related opportunities? What new trends have you witnessed in this arena?

The airlines, in general, have mastered the mobile Internet and are ahead of the other travel suppliers. This particularly refers to the m-CRM, the mobile customer relationship management.

M-CRM or mobile CRM already rules the mobile Internet. Customer relationship management (CRM) and mobile services were meant for each other: mobile devices are constantly present, always on and usually used by only one person. Hence, using the mobile space to provide intelligent, unobtrusive and highly personalized services convinces customers that this is their service. Custom-tailored services and offerings, based on knowing your customers, matching customer preferences, and predicting behavioral techniques are only part of personalizing the customer service in this space.

Here are only some of the m-CRM and customer service initiatives possible, already in use by many of the major U.S. airlines, and some of the hotel brands:

  • Mobile reservations
  • Reservation confirmation text messaging
  • Pre-Arrival texts (up-selling opportunity; reservation reminder; value add – e.g. what will the weather be during your stay, events and happenings at the hotel or in the neighborhood, etc.)
  • Post-stay texts with short guest satisfaction surveys
  • Text Alerts: weather alerts, airport delay alerts, traffic alerts (construction on a main highway into town, etc)
  • Mobile check-in reminders and easy-to-use mobile check-ins
When conceptualizing and delivering m-CRM, hoteliers have to tackle serious issues like data security, privacy concerns, how to make services and applications non-invasive, and solicit customer opt-in and consent.

5. Airlines in the US are starting to allow travellers to book a flight, log on to FFPs, view schedules, and check flight status. How do you think consumers are using these services especially with a variety of web enabled devices including the iPhone and Blackberry?

In the U.S., the number of mobile phone lines has already surpassed the number of  land lines.  More than 90 percent of the U.S. population has a mobile device of some sort.

Mobile devices have become truly ubiquitous, and mobile users expect instant access to information—as well as an Internet experience that rivals the one via traditional PCs and laptops. A significant number of cell phone subscribers have access to the mobile Internet and use some kind of data service such as texting, email, Web browsing, etc.

New research from EyeforTravel shows the average number of Americans who browsed the Internet via their mobile devices grew by 61% in 2008 vs. 2007.

eMarketer estimates 26.3% of mobile phone subscribers will log on to the mobile Web at least once per month in 2009, for a total of 73.7 million mobile Internet users.

6. Travel companies have been focusing on increasing loyalty and gaining advocacy of their customers via mobile phones. For instance, hotels have been delivering services to their guests via their mobile device, making their travel and stay experience easier and more convenient. How do you think mobile as an  important touch point is set to become the new form of immediate two-way communication? Also, since its permission-based, how is mobile paving way for true 1-1 relationship marketing?

In my view, Location-based services (LBS) have already created an environment  for true one-to-one relationship marketing. Location plus personalized services are not only the essence of the mobile Internet, but the very definition of what travel is all about.

Location-based services (LBS) are based on the unique ability of the mobile Internet device to determine its exact location by using GPS, and then to use that knowledge to perform functions, provide information, suggest activities, check out if friends are in the neighborhood, etc.

eMarketer estimates that there were 63 million location-based services (LBS) users worldwide in 2008, and expects this number to reach 486 million in 2012.

Ultimately, the location-based services’ success is closely tied to addressing existing and significant privacy concerns. CTIA, the international mobile industry organization, has already issued guidelines addressing user notice and user consent.

Location-based services have already greatly improved the travel consumer experience. These mobile services are expanding in use and popularity among travelers who expect to receive services such as mapping, navigation services, city guides, etc. upon arriving at the destination.

For example, a traveler approaching New York City and using LBS can obtain information on the city’s main tourist attractions, Broadway show times and ticket availability, exciting events, hotel information and promotions. They may plan or adjust existing travel plans, as well as make reservations via the LBS-equipped mobile device.  Furthermore, if they are browsing a neighborhood such as the West Village in Manhattan, they can easily search for the nearest Italian or sushi restaurant, read customer reviews, select a place, and make an instant reservation.

LBS also allows guests at large hotels and resorts to be notified of new and unscheduled performances, dining promotions, cancellation of events, and new special offers (i.e. 2-for-1 seafood buffet, 25% off day trips, $50 off spa treatments, etc). These services not only provide useful information to hotel guests, but allow good hotel marketers to sell auxiliary services and do ad-hoc promotions.

In addition to these “conventional” services, new types of LBS are already here: services like buddy beacons and friend-finders help travelers and pub hoppers alike hook up with friends who happen to be at the travel destination or in the neighborhood.

Location-based services are poised to become a great marketing tool in the hands of pro-active DMOs, resorts, hotel and restaurant chains, and tourist vendors.

7. How do you assess the availability of mobile website solution or software which works in conjunction with the hotel’s URL (which means it can take advantage of existing search engine rankings and linkage partnerships from the mobile device)? These solutions automatically detect and redirect visitors that are using a mobile device to hotelier’s customised mobile website.

Any travel supplier website, including hotel websites, if developed correctly, should be able to detect the nature of the browser used by the Internet or mobile users and serve an appropriate version of the website: a mobile site to mobile users, a “regular” website to the Internet users. The technology is even more sophisticated than that, and now there are different versions of a mobile site: for iPhone, for BlackBerry, etc

8. What trends do you foresee in travel planning, booking and post booking phase in the next year or so? From booking angle, where do you see the utility of mobile phones for core revenues and ancillary revenues?

The mobile Internet is already here. Mobile marketing allows travel companies and hoteliers to take advantage of a unique marketing and distribution medium where mobile services, marketing messages or applications are delivered via a very personal device (e.g. your cell phone or smart phone). This creates an additional responsibility for m-marketers to “thread carefully” and strictly adhere to best practices and standards due to the highly sensitive privacy concerns of mobile users and wireless carriers alike.

Travelers are already using their mobile devices to plan and book travel and hotels. Even mobile sites of small, single properties are being visited by thousands of mobile customers. Some travel and hotel companies are already taking advantage of the growing mobile traveler population and generating incremental revenues from their mobile sites, marketing and apps.

What can travel suppliers and hoteliers do in the remaining months of 2009? An excellent first step is to create a mobile site, which by default is the “gravitational” center for all future marketing efforts: from text messaging and Google mobile ads, to mobile sweepstakes and applications. As discussed in this article, budget limitations are no longer an excuse for lacking an inexpensive mobile-ready hotel site.

Launching Google Mobile ads as part of a comprehensive search marketing strategy is another natural step. Also, start soliciting sign-ups to the mobile opt-in list (m-list) on the website via hotel email marketing campaigns, social media initiatives, interactive sweepstakes and contests.

What should travel suppliers and hoteliers plan for 2010 and beyond? Location-based services, m-CRM and mobile apps are initiatives in need of careful planning, sophisticated technology, and a better economic environment. Even so, hoteliers should start thinking about how to incorporate these initiatives in the upcoming years.

Note: Max Starkov has presented the session “Mobile Marketing in Travel & Hospitality: The Future is Already Here – An Action Plan for the M-Marketer” at the EyeForTravel’s Mobile Strategies for Travel USA Conference, September 16-17, 2009 in Chicago. Starkov discussed a range of topics including the Mobile Distribution Channel, why travel marketers should care about mobile, mobile booking sites, an action plan for the travel ‘m-marketer’, and more.

www.eyefortravel.com

www.hospitalityebusiness.com

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