INCREASING DIRECT CHANNEL REVENUE WITH TECHNOLOGY

Transcription

1 INCREASING DIRECT CHANNEL REVENUE WITH TECHNOLOGY TheNavisWay.com

2 What s inside this book? Redefining the Direct Channel for a New Era 3 The Technology that Drives Demand 5 The Technology that Effectively Captures Data 7 The Technology that Converts Demand 10 Contents 3 Travel Trends: How Hotels Can Make the Most of Them 12 Priceless: The Benefits of Direct Channel Investment 15 About NAVIS 16 2

3 Redefining the Direct Channel for a Chapter 1 New Era 3

4 Redefining the Direct Channel for a New Era The direct channel has become synonymous with web bookings; as such, online marketing receives the lion s share of attention in hotel marketing strategies and budgets. However, the voice channel has been overlooked in the direct revenue conversation despite the fact that it s ever-increasing importance to drive more profitable business. With the increasing use of mobile click-to-call capabilities, the trend toward framily and multi-generational travel, and guests demanding more personalized communication, the voice channel is more important than ever. The goal of Drive + Capture + Convert is simple: To leverage every touch point with every potential guest. It s a new era in travel planning. Consider that: According to Google Insights, 58% of travelers would be extremely or very likely to call a hotel if the capability was available in a smartphone search result. 1. They drive demand intelligently with online marketing campaigns that are not based on guesswork, but on real data showing which media outlets and marketing messages are the top revenue producers. The voice channel can show a 31% ADR premium over other booking methods making these reservations by far the most profitable. The opportunities for incremental revenue, package sales, and adding nights onto a stay increase substantially with the voice channel. 2. They capture data about inbound callers to enable outbound call follow-up and enhance caller-agent rapport and guest experience. Though guests may research and perhaps even book online, studies show that 50% of travelers will call the property directly at some point during the planning process, especially for high-consideration stays (important, expensive, or complicated). 3. They convert demand quickly with thorough and ongoing sales training that provides tools to measure each agent s effectiveness and includes an incentive-powered outbound call program. For our purposes, direct and voice channels are one in the same. Successful hotels optimize their direct channel and use technology across three interconnected steps. 4 For a complimentary Direct Channel Analysis visit TheNavisWay.com/meet-navis

5 The Technology That Drives Demand Chapter 2 5

6 The Technology That Drives Demand Driving demand is less about increasing the volume of potential travelers and more about increasing the quality of the inquiries. Driving quality demand means drawing in the most relevant travelers for a property or an offer, as well as capitalizing on the existing demand the 70% of calls that go un-booked. Marketing technology is central to this effort to increase and convert calls into loyal, paying guests. The proper technology measures online (digital web banners and marketing) and offline (print, TV, radio, etc.) marketing attribution and creates revenueproducing campaigns as well as a productive outbound sales program. Marketing Optimization: Understanding Campaign Effectiveness Effective campaigns use toll-free number technology that creates unique numbers for each and every campaign. The benefits are two-fold. First, this allows reservations agents to immediately know what campaign a call is originating from, which allows agents to ask more targeted questions and better serve the guest from the outset. Second, when information is gathered from the callers and analyzed, new more successful campaigns take shape. The best call-center systems interface with a hotel s property management system (PMS) to track the total revenue attributable to each online and offline promotion, including which campaigns trigger the most inquiries as well as revenue generated by every guest stay for each campaign. The Other 70%: Higher Conversions from Existing Demand On average, only 30% of calls result in a booked reservation. This means 70% of your existing demand goes un-booked. The list of that 70% is akin to having your competitor s guest lists. Tracking not-booked calls, especially when a well-trained agent is able to establish a rapport and set a time to call back, can result in highly effective outbound calling campaigns as well as re-marketing campaigns to not-booked leads. The Technology It Takes to Drive Demand Campaign-tracking technology, including toll-free numbers for each campaign, as well as URL tracking and online campaign tracking, is key to marketing optimization. Real data showing which media outlets and marketing messages are the top revenue producers will drive better marketing campaigns, and, ultimately, more profitable business. 6 For a complimentary Direct Channel Analysis visit TheNavisWay.com/meet-navis

7 The Technology Chapter 3 That Effectively Captures Data 7

8 The Technology That Effectively Captures Data Perhaps the most integral piece of driving direct channel revenue aside from the sociable, incentivized agent, of course is the data. While many properties agree that data collection is important, most do not have an effective data collection method or technology. Capturing key data on travelers enables outbound call follow-ups to drive higher profits and enhance caller-agent rapport. Effective data capture falls into these four categories: Guest Data Data that should automatically be captured includes the guest s phone number, demographics, past-stay information, and the value of previous stays. When this information is displayed automatically alongside information about which marketing campaign drove the call, an agent is able to focus on asking the right questions, establish a relationship much more quickly, and speak directly to a prospect s interests, greatly increasing their liklihood to book. Call Metrics This includes call scoring, which allows reservations managers to better train and coach agents; lead follow-up times; and revenue generated from lead follow-ups. Agent scoring should also be used to automatically direct calls to agents with specific skills and/or high conversion rates. NAVIS is all about making lodging providers more successful with more revenue, more actionable data, and more reservations. With NAVIS technologies, processes and expertise, our clients have more visibility into their callers, prospects, agents, and their businesses and are able to fine-tune the performance of their sales and marketing. 8 For a complimentary Direct Channel Analysis visit TheNavisWay.com/meet-navis

9 Perhaps the most integral piece of driving direct channel revenue aside from the sociable, incentivized agent, of course is the data. Call Volume Ideally, data collection includes details about peak call volume times as well as the volume of calls arriving after hours. This data is critical to properly staff a reservations team or call center. If you re not answering 25% of the days call volume because it s coming in after hours or at unexpected peak periods, you may need to enlist a professional overflow and after-hours call center. Take a look at what 25% of your day s call volume is. If you were able to answer those missed calls, increase your conversion with guest insight and utilize outbound call strategies to those who didn t book - how much revenue would that represent? Not-Booked Leads An outbound sales program to fully optimize your existing demand and drive incremental revenue relies on collecting caller data on not-booked inquiries (leads). Ideally, the reservations sales agent gathers the reason for not booking, so that this traveler can be effectively re-marketed to and marketing campaigns can be refined. The system should also capture which team member took the caller s previous inquiry so that calls can be re-routed to that agent and have a higher probability to convert. The Technology It Takes To Effectively Capture Data Automated call distribution (ACD) and data collection technology integrated with a PMS. Phone numbers, geography, and other demographic data may be collected automatically, while a savvy CRM allows agents to gather household data and personal preference details, as well. This means guest preferences are available for marketing campaigns and guest history may be used to target messages. 9 For a complimentary Direct Channel Analysis visit TheNavisWay.com/meet-navis

10 The Technology Chapter 4 That Converts Demand 10

11 The Technology That Converts Demand Digital marketing receives three-quarters of the marketing budget while only a quarter of bookings come in via the online channel. The online channel and the voice channel, rather than working independently of one another, work in tandem. The path to purchase flows from devices to voice, from voice to devices sometimes multiple times depending on whether the reservation is complicated or of unique importance. A recent Google study reports that among travelers 52% will call a hotel directly from a search to make a reservation 50% will call to inquire about promotions, incentives or deals 49% will call to inquire about or compare pricing Rather than declining in importance, voice conversions are increasingly critical in this new travel-purchasing model. While the voice channel clearly relies on people, ideally a savvy reservations sales team, conversion rates can be substantially improved if this team has the assistance of the right technology. Coaching Technology offers valuable tools for understanding team and individual performance. For instance, NAVIS technology records calls and measures individual agent KPIs with ease. This means truly customized coaching for reservation sales agents that will make them more successful agents. An immediate benefit of this technology is the option to direct calls to the agents with the highest conversion rates. Incentives Rather than pulling conversion goals out of thin air, hoteliers can review historical data and set realistic goals based on each individual s track record. Agent level and manager level incentives can be established based on behavior as well as on data. Key categories may include call scores, average booked stay value, upgrades, and additional nights sold. At Ojai Valley Inn & Spa, agents have been incentivized based on tracked behaviors, trained to accurately use the system, and are offered full transparency with access to their personal metrics at all times. Agent payout during the resort s first year on an incentive program was $30,000, and it has grown to $100,000. This may seem substantial but when the booked revenue increases at the same rate because of wellplaced incentives, it s a no-brainer. The Technology it Takes to Convert The technology required to do this offers real-time data collection including call recordings, and allows managers to establish and monitor individual and collective goals. Recommended tracking includes: Number of calls answered Number of reservation calls answered Amount of revenue booked Revenue per answered call Revenue per reservation call Revenue per booking Conversion percentage Number of bookings Totals for all categories 11 For a complimentary Direct Channel Analysis visit TheNavisWay.com/meet-navis

12 3 Travel Trends: How Hotels Can Chapter 5 Make the Most of Them 12

13 3 Travel Trends & How to Make the Most of Them Trend #1: Business is booming. Hotels must be attuned to acquisition costs In 2015, Smith Travel Research (STR) predicts occupancy will rise to 65.1%, ADR will increase 5% to $121.37, and RevPAR will grow 6.2% to $ How does your property compare? Now is the time to optimize the distribution channel mix for optimal profit. However, there is often forgiveness in good numbers and hotel operators forget to scrutinize the costs associated with capturing those bookings. What It Takes to Make the Most of It: Top line revenue is not the same as profit dollars or net revenue, which factors in costs and resources spent on each distribution channel. Dig deeper reviewing each channel OTAs, group, corporate, negotiated, leisure online and offline for profit dollars. When times are good, RevPAR is going to increase on its own. If RevPAR is your primary measure, consider other metrics that give insight directly in to your profit like cost per acquisition (CPA) and then narrowed down by CPA per channel. You ll likely find that the direct channel is the most profitable, bringing in substantially higher ADR and costing less per acquisition, so determine how to best leverage your direct channel alongside other avenues to achieve optimal profit. Trend #2: Framily travel led by the Millennials Whether traveling as multiple families and friends or multiple generations, Millennials like to travel in framilies. They are anticipated to travel more than any other generation, they desire personal and personalized time, and they want unique, local experiences. Vacation rentals are in a great place to capture this business; however, hotels with flexible accommodations (one-bedroom suites and adjoining rooms) can also benefit greatly from growth in this segment. 13 For a complimentary Direct Channel Analysis visit TheNavisWay.com/meet-navis

14 Increased travel budgets offer the opportunity to sell longer stays and unique travel packages as well as grow incremental revenue. What It Takes to Make the Most of It: These are complicated stays with lots of people involved. How many beds? Who needs separate rooms for their family? When will everyone arrive? What activities are planned? These are also high-consideration stays, that generally require a phone call or several. Ensure reservations agents are thorough in their understanding of the hotel or rental accommodations as well as amenities. Trend #3: Travel budgets are increasing & stays are getting longer Two in five travelers are planning to increase their travel budget this year. Thirty-four percent of those travelers report they are planning a longer trip, while just 20% say they re planning increased short trips of 4 days or less (TripAdvisor TripBarometer, March 2015). What It Takes to Make the Most of It: Additionally, a technology such as Narrowcast can track which reservation agent last spoke with a potential guest and future calls can be re-routed to the same agent to continue the conversation. By making the reservation process as personalized and easy on the prospect as possible, the likelihood of booking skyrockets. Increased travel budgets offer the opportunity to sell longer stays and unique travel packages as well as grow incremental revenue. Market longer-stay packages to guests with a history of longer stays as well as those who have booked larger units or suites for their families. When the guest calls in, agents can engage them about their interests (spa, golf, fine dining, kids activities), which builds a relationship and, ultimately, increases ancillary revenue as well. 14 For a complimentary Direct Channel Analysis visit TheNavisWay.com/meet-navis

15 Priceless: The Benefits Chapter 6 of Direct Channel Investment 15

16 Priceless: The Benefits of Direct Channel Investment A study of brand-affiliated hotels from 2009 to 2012 shows acquisition costs have increased at the same pace as revenue growth. Total acquisition grew by 23%, and third-party acquisition costs rose by 34% (Hospitality Asset Managers Association). Finding the path to the most profitable reservations is essential as third-party distribution grows in strength and number, and digital marketing spend multiplies with every new available online travel and social media avenue. While there s no disputing that voice reservations are the highest value (and in most cases profit) bookings, there are also a myriad of other reasons to drive the voice channel. Who s guest is it, anyway: Distribution channels hold on tightly to guest data and claim the guest as their own, which limits a hotel s ability to market future opportunities. Brand loyalty: Reservations agents who have smart technology that shows guest history and demographics and who are skilled in building relationships can increase brand loyalty substantially. Brand consistency: When hotels invest in training and coaching for the reservations sales team, and treat them as sales people rather than order takers, these agents become brand builders. Conversely, when guests have challenges with their reservations booked through OTAs, the brand can be affected irreversibly. Inventory control: Hotels have more control over inventory if less of that inventory is distributed to third parties. Payment delays: In addition to high distribution and commission costs, third-party channels typically delay payment up to 45 days, affecting cash flow and creating accounting complications. While most of these issues can t be directly tracked in revenue, suffice it to say that the long-term benefits of brand consistency and guest relationships are priceless. JC Resorts with four renowned golf and resort properties in California implemented a Drive + Capture + Convert strategy in late As a result, one specific JC Resorts property has seen: 7% increase in ADR 9% call conversion increase $250,000 increase in outbound call revenue The numbers speak volumes, but what matters just as much is the exceptional, luxury- -level service they have provided to guests, creating brand consistency and brand loyalty through technology. 16 For a complimentary Direct Channel Analysis visit TheNavisWay.com/meet-navis

17 Thank you! Contact us to find out how NAVIS delivers high-performance sales processes that result in higher ADR, longer stays, longer booking windows and increased ancillary spend. Did you know NAVIS clients convert more 1st-chance bookings, and produce dramatic revenue results from 2nd chance bookings? We can help you do the same thing! For a complimentary assessment of your own direct channel health and distribution mix, please visit TheNavisWay.com/meet-navis NAVIS sales and marketing solutions empower resorts, hotels, and vacation rental management companies to leverage the full profit potential of their direct channel. NAVIS hospitality clients drive more demand, capture more demand, and convert more demand with dramatic increases in revenue and RevPAR. With a laser focus on actionable, real-time CRM data from the direct channel, NAVIS uncovers new and often ignored revenue opportunities, including increased reservations productivity, greater marketing efficiencies, optimized call centers, and greater visibility into their businesses. NAVIS clients outperform competitors, enjoy greater market share, higher NOI, and more revenue.