Forget Daylight Savings: Start Saving On These 4 Hotel Marketing Costs

March 15, 2016 • By

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While the rest of the nation is celebrating their extra hours of sunlight because of Daylight Saving Time, now’s the perfect time for smart hotel marketers to make their costs lighter as well.

Call it spring cleaning or just a way to lessen your property’s monetary obligations, DST and the onset of spring is a great excuse to refocus on maintaining a healthy profit margin for your hotel.

So, spring to action and follow these steps to cut down on the major expenses that could be weighing down your marketing budget. 


1. OTA Commissions: Yes, That’s a Marketing Cost

OTAs are a distribution channel and distribution is a key component of marketing. So, stop looking at your OTA commissions as an operational cost! They are a marketing cost. And it’s no secret that hefty commissions paid to OTAs are stifling and robbing your hotel of its rightful revenue. But, don’t be so quick to blame the OTAs for that. You could – and should – be proactively going after more direct bookings with your own seasonal promotions, email campaigns, retargeting ads and targeted offers. Also by leveraging your data, responding to TripAdvisor reviews, and capturing guests when they’re already on your site. The majority of your marketing budget comes down to customer acquisition costs (CAC). OTAs have some of the highest CAC, while direct bookings have the lowest.

Plus, don’t make the mistake of overstocking your OTA inventory, which effectively cuts you off from earning as much as you can if you allocated those rooms for direct bookings or less costly channels.

2. Dump Pricey, Broad PPC Keywords That Never Produce ROI

The most common Google AdWords mistake is also the costliest. Countless hotels are still sinking their money on expensive, high volume key phrases, such as “New York hotels,” which quickly eats away at your marketing budget and produces little to no conversions from click-happy consumers who are just tire-kicking you and your compset’s prices. The cost alone for these broad, overused terms should warn you to stay away. We’ve seen generic phrases, such as “Miami hotels,” costing $6 – 8 more per click! With only 3 – 5 percent of clickers converting into bookings, the chance of seeing positive ROI is practically impossible. Get smart about your PPC budget and aim for targeted phrases instead.

3. Put the Brakes on Free Upgrades and Comp Rooms

Take a cue from your hospitality cousins: the casinos. To them, comps and upgrades are all about the math. The more someone spends and wagers at their tables and slot machines, the more comps they receive. Comps are not given to guests who simply walk into the casino and ask for them.

Plus, travel hackers have gotten really savvy about comps and upgrades and are more than happy to share their secrets with others. Google "how to get a comped hotel room" and you’ll find legions of articles and blog posts outlining the sneaky strategies hotel guests can use to milk more out of your hotel. Put a stop to it. Unless, of course, you enjoy losing revenue. 

4. Renegotiate Vendor Contracts

At Tambourine, we don’t require contracts, so its always baffled us why so many hotels sign rigid contracts that handcuff them to a vendor for years, regardless of client happiness or vendor performance.

It’s all too easy to sign vendor contracts and forget about them, which often leads to overspending on tools and services you no longer need. Smart hoteliers are vigilant about the money they’re spending on marketing vendors and whether they are receiving the value they anticipated. Dust off all of your marketing vendor contracts, including your PMS, channel manager, advertising, email, social media and hotel booking engine agreements, and review their performances.   


About Tambourine

Tambourine uses technology and creativity to increase revenue for hotels and destinations worldwide. The firm, now in its 33rd year, is located in New York City and Fort Lauderdale. Please visit: www.Tambourine.com

Direct Bookings, hotel marketing, Hotel Marketing Advice, Hotel Marketing Tools, Hotel Revenue, OTA, ROI