maximizing revpar through artificial...
TRANSCRIPT
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Maximizing RevPAR Through Artificial Intelligence.
A Look Into The Future of Hospitality Marketing
John Hach
Senior Industry
Analyst
October 25th, 2016
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Artificial Intelligence and HoteliersDoes this look like the future?
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To look into the future…. We must first look into the past
The ‘Then” of Travel OTA E-commerce
A Supermarket of Rates
The paradox of choice
11/2/2016 5
“I want to travel, but can’t find a place to make a reservation.”
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Making the
AI Case
FIVE
KEY DRIVERSin the hospitality
industry
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Fragmentation in the
booking process
Consolidation and
significant new players
OTAs continue
to grow
Complete usage of BIG
DATA is becoming the differentiator
Global consumers an
essential part of the mix
Fragmentation in
the booking process:1
FRAGMENTATION IN
THE BOOKING PROCESS
Average conversion within booking engines is between 1-4% so that means you can expect:
abandonment
It sounds terrible…But it is really our
biggest opportunity.
Consolidation and significant
new players:2
CONSOLIDATION /
SIGNIFICANT NEW PLAYERS
Consolidation continues with stronger players
Now powered by:
OTAs continue to
take a grip:32Consolidation and significant new players:Consolidation and significant
new players:2
New Entrants / New Challenges
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– Priceline rapidly expanding it’s family of companies and diversifying into related areas
Consolidation and significant
new players:2
– Google aggressively testing the water to get the right model in travel and tourism
– Recently launched early AI for research to purchase process with “Destinations” on mobile
Consolidation and significant
new players:2
– Oracle evolving property management systems by purchasing Micros
Consolidation and significant
new players:2
OTAs continue to
take a grip:3
OTA Growth Continues
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Big Data Now4
BIG DATA
has become the differentiator
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Pace Variance – 12 month Outlook
June July August September October
Total -4.4% -3.6% -2.8% -2.3% -1.2%
Group -31.0% -10.6% -16.7% -7.8% -8.5%
Transient -0.9% 0.2% 0.1% -1.3% 1.2%
-40%
-30%
-20%
-10%
0%
10%
20%
Varian
ce %
vs Last Ye
ar
Global consumers an essential part of the mix5
GLOBAL CONSUMERS Reaching
them provides competitive advantage
They are starting to book independently as confidence grows and reciprocal visa restrictions are lifted
Global consumers an essential part of the mix5
Arabic, Chinese, Russian, Brazilian and Indian are all significant in value
Need to have a robust multi-lingual, content-relevant approach to both acquisition and conversion
Global consumers an essential part of the mix 5
Need to have differentiated marketing approaches
Global consumers an essential part of the mix5
90%By 2018of web traffic
will be video
The digital world
is changing:
Distribution is more
complex, and consumers
have more choices than
ever before. Standing out
from the crowd is key!
Video content on your site
helps differentiate it from
the OTA sites driving web
direct bookings.
New competitors like Airbnb
are using video
technologies to their
advantage.
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To drive high volume, qualified traffic to your website, we
need to select the right channels throughout the purchasing
funnel
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Branding (Awareness)• Target Audience: “Researcher”
• Advertising Vehicle: Premium Sites
Brand Engagement (Interest)• Target Audience: “The Intender” & “Price
Comparison Shopper”
• Advertising Vehicle: Behavioral / Contextual Display
Direct Response (Desires/Action)• Target Audience: “Decision Maker”
• Advertising Vehicle: Organic Search/Paid Search
• Target Audience: “Site Abandoner”
• Advertising Vehicle: Remarketing
Awareness (Branding)
Interest (Brand engagement)
Desires/Action (Direct Response)
Action (User Retention)
Brand Search
Geo targeted Search/SEO
Behavioral/Contextual Display
Premium Sites
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WHERE a customer abandons points to strategic solutions
date selection rate / room selection checkoutenhancements
abandonment rate abandonment rate abandonment rate abandonment rate
These solutions can point to a new and engaging opportunity for your web sites.
Preparing
for
The Future
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Understanding the evolution of Artificial IntelligenceFrom transaction processing into machine learning
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Let’s take a closer look at current state
