Aligning the Online & Offline Channels for Reservations Managers

January 11, 2018 Cody Putman

 

According to a recent Sabre article, “Connected travelers do not limit themselves to either online or offline—they rather seek out benefits from both worlds.”[i]  So, when it comes to the opportunity independent hotels and vacation rentals have to increase both occupancy and RevPAR in the coming year, aligning online and offline channels ranks among essential growth-supporting strategies.

 

Though the lion’s share of marketing energy has been behind digital for many years, for some in hospitality, the voice channel never wavered. Kyle Harris, the Marketing Manager for Park City Lodging, a vacation rental company with more than 130 properties, notes, “Seventy percent (70%) of our guests book via phone, whether that’s through our call center, travel agents, or wholesalers. Our guests pay a substantial amount to stay with us, and they want to speak with someone before they commit, even if they’re comfortable booking online.” Their strategy to ensure that online and offline channels are aligned has involved carefully tracking guests across channels, integrating their PMS with Narrowcast for a clear picture of attribution, as well as a detailed NAVIS Reach marketing dollar assessment.

 

Seeing Double

While the online to offline path is ideal because voice channel bookings have a higher conversion rate and typically earn two-thirds more revenue than online bookings, each outlet has strengths on which to capitalize. Online bookings have the lowest acquisition cost of all bookings; however, reservations agents have the highest conversion rates at 40%. NAVIS VP of Sales Michelle Marquis notes, “I am surprised when I run across a property that doesn’t include a phone number throughout their website, especially on the booking page. And it happens frequently. Independents and vacation rentals have so many more considerations than a chain hotel—we call them high-consideration stays—and often a guest will realize that a phone call, even at the last minute, will help them feel 100% confident in their decision.”  Harris follows up saying, “We make a point—on our website, in our email campaigns, everywhere—to promote both online and offline options for booking, even if we think they’ll book online.”

 

For reservations managers, the impact of being formally integrated into the marketing strategy can be tremendous. A property can begin to see sharp increases in phone calls very quickly when offline bookings are promoted and, therefore, staffing may need to be shifted to ensure as much call coverage as possible. Additionally, reservations and sales and marketing must communicate regularly so that the reservations team is abreast of campaigns they will be selling and tracking. 

 

 

Volume versus Conversions

Rather than isolating the online channel as the focus of the entire purchase process—inspiration to research to purchase—it may prove more advantageous for lodging suppliers to weight the online channel as an initial demand generator and the offline channel as the bookings generator. There is no doubt that the volume of interest created online is efficient and cost-effective, but very little of that volume is converted to business when those prospects stay online only. Ninety percent (90%) of website visitors vanish, never to be seen again, and of the 10% of visitors that give careful consideration to your property, just 1.7% will convert to a booking. A reservations agent, on the other hand, is 20 times more likely to turn a prospect into a booking.

 

Reservations managers responsible for training agents should know that, while there are a substantial number of guests doing research before they call, there appears to be a growing group that have never been to a property’s website at all, having spent most of their time on third-party sites. As Adweek’s Christine Birkner notes, in a survey by brand engagement firm Sullivan, none of the travel consumers who reported that they had booked online, had visited a hotel’s website directly. Park City Lodging’s Harris says that one way he contends with third parties in the online space is to use OTAs for guest acquisition and then re-target that guest to a direct booking, either direct to the property website or the phones.

 

More Online Activity = More Responsibility for Reservations Agents

In an article about the changing world of car sales Harvard Business School lecturer Frank Cespedes says, “Although consumers do a lot of online research — the average U.S. car shopper now spends 11 hours online and only 3.5 hours offline, including trips to dealers — the vast majority still end up purchasing their cars in person. According to a 2015 DrivingSales study of more than 1,300 active car shoppers… the changing behavior of buyers has placed even more emphasis on selling at the dealer.”[ii]

 

The same goes for independent hotels and vacation rentals. The volume of time spent online in the inspiration and research phases of the booking path is high. A 2017 report by Fuel and Flip.to found that while travelers appear to be visiting fewer websites than previously thought—most report visiting four sites—when they do land on your website, they will spend nearly 30 minutes reviewing. Additionally, they found that 76% of travelers said they would call if they had a question during the booking process.[iii]

 

As Cespedes notes, when that phone call comes, there’s more pressure to close at that moment. “Much of our emphasis in agent training now is on first call resolution. Ensuring that we don’t inadvertently send that prospective guest back into the crowded online market, where chances of losing the guest go back up. Instead, managers must empower agents to close the deal in the moment; sometimes this means giving them on-the-spot leverage to offer value-adds or special rates that won’t undercut branding,” says NAVIS’s Marquis.

 

Reservations managers at independent hotels and vacation rentals carry more weight at the point of sale. Agent training and technology that assists agents in tracking guest data will give staff an edge. Additionally, reservations managers can give agents cautious latitude with prospective guests. For instance, when a guest reports an OTA is publishing a lower rate and the report is confirmed, give agents the authority to match the rate. In July of this year, Piper Jaffray reported that a survey of the top four hotel chains found better rates on an OTA or third-party 21% of the time, and the price was 4.2% less expensive on average, which makes it especially egregious when a guest returns from an agent to an OTA.[iv]

 

What Real Visibility Looks Like

Few analytics tools offer a complete picture of the online to offline pathway. Even Google is continually trying to harness this. Harvard Business Review reports that in the first quarter of 2017 most purchases happened offline and that Google is just this year claiming to have figured out the “’online ad-offline purchase’ gap” by connecting ad exposure to retail sales.[v]  

 

For hotels, this capability already exists in NAVIS Narrowcast, which can track all online and email campaigns to phone calls. As Harris notes, Narrowcast goes a step further. “Our PMS talks to Narrowcast and NAVIS becomes the true source of what happened. Sure, you can track a reservation made through Google Analytics, but Analytics won’t track a cancellation, and this can make or break additional spending on a channel.” Further, he says, “Our revenue is split between owners and the company, so we have to be very clear about how much income we’re generating for the price of what we paid in advertising before we can call a campaign a success.”  If an OTA campaign is resulting in a higher percentage of cancellations, occupancy and RevPAR suffer. True visibility into the online to offline path to purchase must begin at the research phase and continue through the actuality of the stay. It’s worth noting that a conversation with a reservations agent—a person-to-person connection—decreases the chances of the cancellation, as does a firmer cancellation policy that is accompanied by a value-add. (Travel search company, Dohop, reports that one in five hotel reservations booked on a website is canceled.[vi])

 

Conclusion

On its most basic level, alignment is to draw a straight line between two things. The online to offline path to purchase is far from a straight line—it’s more of a zig-zag, sometimes a pile of spaghetti. Think of alignment here as a thread that holds both of these channels together, that keeps them connected.

 

The online channel may generate volume (PPC spend, web strategy), while the offline channel may be more focused on converting that volume (tracking technology, agent training). Independents and vacation rentals that undertake a more nuanced approach to these channels will be in the company of proven brands. Case in point, in 2017 Reservations.com set out to “tightly couple online and offline assisted channels so travelers who have started their booking process or have booked in the past can choose to call a customer service representative who can help them complete the process with minimal effort.”[vii] 

 

Frank Cespedes, who you’ll recall studied the ways consumer car-buying habits are changing, says in his message to other industries, “Profitable growth is determined by how the buyer buys today and tomorrow, not yesterday, so don’t chase abstract generalizations about the Internet while ignoring the point of sale.”[viii] For independent hotels and vacation rentals, this means following the needs of today’s travelers and adjusting not just your strategy for demand generation but also for the point of sale.

 

[i] Sabre, 2017

[ii] HBR, 3/2016

[iii] Vizlly, 2017

[iv] Skift, 7/2017

[v] HBR, 6/2017

[vi] Tnooz, 12/2015

[viii] HBR, 3/2016

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