Winning the War on Booking Friction for High-Consideration Stays

April 5, 2016 navisadmin

Friction reduces conversions, frustrates customers, and eats away at your bottom line. It can be anything from a slow-loading page to unclear instructions during the checkout process. When TripAdvisor launched its instant booking feature on mobile, the company announced it was aiming to “remove friction” from the booking process.1 TripAdvisor knew that converting travelers to Instant Booking was dependent on ensuring a seamless reservation. It is this emphasis on the traveler booking experience that allowed OTAs to capture half of US online bookings last year.

It is no secret that OTA bookings are commodity-based purchases. For instance, when a traveler needs a room for two nights in Orlando for $150 to $200, it is a relatively simple, need-based purchase. As the visual below demonstrates, as basic physical and safety needs are met, the desire for the “experiential” grows—and with it the perceived economic value. Travelers will invest more in experiences, trips that are memorable and potentially transformative. The emotional and economic investment requires greater consideration, and an OTA won’t do for the high-consideration stay. Nor will a website always cover all the necessary bases for high-consideration stays.

 

Maslow Hierarchy of Needs

Independent hotels, destination resorts, and vacation rental companies all fall within the high-consideration sales category, and high-consideration accommodations require more research and more airtime. Literally. The experiential stay necessitates a phone call more often than a commodity-based purchase. There are more details to cover, more emotional needs to satisfy, and the risk of disappointment is greater so the guest wants to be sure of her choice.

High-consideration properties must remove all booking friction. Booking friction is anything that gets in the way of your guest booking a room. According to Travel Weekly, travelers spend 25% more time researching and booking hotels than flights and the research process is growing in length while booking lead times are shrinking.2

The traveler path to purchase is increasingly erratic, scattered across multiple devices, and increasingly involves smartphones. The focus in recent years on web responsive mobile websites has, however, eclipsed an important consideration: phone calls. There is a natural inclination when one is on a mobile phone to call. In fact, Google reports that:

58% of travelers would be extremely/very likely to call a hotel if the call capability was available in a smartphone search.3

However, many accommodations are unwittingly creating booking friction in the quest to capture mobile bookings by opting not to include phone numbers during key parts of the booking process. The further into the booking process, the more important the ability to call—with ease—is in order to avoid abandonment. (We would also venture that offering the ability to text is an important aspect of avoiding booking friction.) All of this is exponentially more important for a high-consideration property than it is for a commodity-based reservation.

The Voice Channel Offers a Silver Lining

There’s a silver lining to all this bad news about friction: Eliminating friction is one of the easiest and most direct ways to increase your bookings. While many properties have spent countless marketing dollars and hours hunting down web reservations, the voice channel has been left behind in the last century, primarily because the revenue potential of the voice channel has been ignored.

Consider a property with 130 rooms, an annual occupancy of 68%, and an average length of stay of 2.5 nights. This property receives 12,906 reservations each year. If just 20% of this business is booked by phone and the reservation team’s closing ratio averages 30%, this hotel has an opportunity to pick up an additional 6,023 bookings.

We know removing booking friction, like making it easier to connect with your reservations team, consistently increases pick up by at least 5%. For the hotel above a 5% increase would mean an incremental 301 bookings each year. Consider an ADR of $175 and the 2.5 average length of stay, and this property can easily achieve an additional $131,688 in new revenue. A meaningful sum that clearly supports having a phone number in all the right places.

Sources:

1). TripAdvisor Launches Its Instant Booking Feature for Mobile. TripAdvisor. June 2014.

2). Weinsheimer, Kurt. “For Hotels, A New Reality of Booking Lead Times and Path-to-Purchase.” Travel Weekly. October 27, 2015.

3). The Role of Click to Call in the Path to Purchase. Google. September 2013.

 

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