Hoteliers are beginning to understand that increasing direct bookings and repeat business could happen ONLY by increasing investments in a) digital marketing and b) CRM technology.
A recent discussion on RevFine asked this important question. Here is my take.
Did anyone notice that Expedia spent nearly 50% and Booking nearly 40% of their net revenue on Sales & Marketing in 2021? Compare this to 2.5% of net room revenue that hoteliers usually spend on marketing in “normal” years like 2019.
Even worse, marketing spend in U.S. hospitality during the pandemic shrank significantly compared to 2019, dropping to as low as 50% in 2020 and rebounding slightly to 54% in 2021 of the pre-pandemic level (STR).
Marketing spending in Europe and APAC is even worse than in North America.
Implementing CRM technology and program is a crucial approach to significantly increase direct bookings. In the post-pandemic era, success in bringing repeat business will make or break the property. You cannot have a meaningful repeat business (5-15 times cheaper than acquiring new guests) without a CRM technology and program in place. Only a meaningful CRM technology application – as part of your hotel tech stack – can ensure deep engagement with your past and future guests.
CRM tech not only provides automated pre-, during- and post-stay communications, guest satisfaction surveys, guest retention marketing automation and drip marketing campaigns, but takes it a step further via guest recognition program management and loyalty marketing.
All of these fully automated CRM initiatives keep “the conversation going” with your upcoming and past guests, keeps them engaged and steers them in the right direction: to book your hotel when it’s time for them to visit your destination again.
In addition, you can use your CRM first-party data about your best guests to launch similar audiences marketing on Google, Facebook, Instagram, etc., to target potential customers with similar characteristics as your best guests.
CRM technology has become widely available and reasonably priced via hospitality-specialized vendors like Cendyn CRM, Revinate CRM, Amadeus GMS, etc., yet less than 10% of independent hotels have implemented CRM programs in place.
Hospitality & Online Travel Tech Consultant & Strategist