Here at HeBS we firmly believe that a comprehensive, ROI-centric
Internet marketing strategy is the hotelier's perfect "survival tool"
in the current economic environment. In the difficult year we expect
2009 to be, a well-executed Internet marketing strategy can help smart
hoteliers generate incremental revenues, improve marketing ROIs, retain
existing and attract more affluent travelers, and out-smart the
competition. For the past almost 14 years, our experience shows that
Internet-savvy hoteliers with robust Direct Online Channel strategies
are the winners in economic downturns like this one.

The Travel
Industry Association's (TIA) latest survey predicts a drop of at least
1.3% in overall leisure travel in 2009. Corporate travel is already
down as a result of massive layoffs and economic contraction. There are
visible signs of decline in the corporate and association meetings and
group travel business. Unfortunately, these declines are expected to
accelerate in 2009. Yet, even with this expected decline in travel,
online travel bookings in 2009 are projected to grow by 10.5% and reach
$116.1 Billion (eMarketer), primarily as a result of the dramatic shift
from the offline to online channel.

In 2009 the Hotel's
overall competitiveness and even survival will be determined to a great
extent by how well it manages its Internet marketing and distribution
efforts. In 2009, more than 55% of all travel bookings and up to 40% of
all hotel bookings in North America will be generated from the Internet
(eMarketer, HeBS), which represents a double-digit growth over 2008.
Another third of hotel bookings will be directly influenced by online
research, but booked offline. By 2010 the Internet will contribute over
45% of all hotel bookings in North America.

Furthermore, a
2008 McKinsey survey of 340 senior marketing executives worldwide
reported that despite the decline in economic activity, 91% said they
plan to maintain or exceed current levels of online advertising, and
55% were cutting traditional media, "precisely in order to increase
funding for online efforts." The survey shines a light on what many
marketing professionals already know. The intended and relevant
audiences are online, at lower cost, and with measurable results.

What
are hoteliers to do in these dire economic times? How can they avoid
discounting pressures and further commoditization of the hotel product?
What type of marketing initiatives will produce the highest
return-on-investment (ROI) in 2009? What are the best approaches to
retain customers in this environment? The "2009 Top Ten New Year's
Internet Marketing Strategy Resolutions", presented by Hospitality
eBusiness Strategies (HeBS) for the ninth year in a row, provides some
of these answers and action steps.

Whether you are a major
hotel brand, hotel management company, independent or franchised hotel
or resort, even in this environment you can stay well ahead of your
competition and capture new market share with an effective ROI-centric
Internet marketing strategy. Smart and proactive hoteliers who utilize
best practices in Internet marketing and follow latest trends to their
own advantage will define the industry winners and losers in 2009 and
in the long term.

Here are the Top Ten Internet Marketing Resolutions your hotel company should consider adopting in 2009:

1. I will turn 2009 into the Year of Outsmarting the Competition.
   Even though fewer people will be traveling to my hotel's destination, I
   know there will be more than enough travelers to maintain a healthy
   occupancy rate if I can "steal" market share from the competition. I
   know that my competitors are skeptical about the current economic
   downturn and are consequently slashing marketing budgets. I will
   continue to invest in my Internet marketing and do my best to increase
   market share by being a smarter marketer in 2009.

2. I will overhaul my hotel's marketing budget to achieve the highest return-on-ad-spend (ROAS).
   Unlike the competition, I will not automatically cut my hotel's
   marketing spend, but re-evaluate my marketing efforts and advertising
   budget and focus on proven return-on-investment (ROI)-centric efforts.
   I will shift funds from offline to online advertising formats. I will
   shift funds from brand-building to direct-response initiatives. I will
   track every dollar spent with sophisticated website analytical and
   campaign tracking technology (Omniture, DART, etc.) to make sure that I
   achieve respectable return-on-ad-spend (ROAS) from every campaign.

   I
   understand that in this economic environment I should not be
   experimenting with unproven advertising formats. In 2009 I will focus
   only on proven Internet marketing formats that generate above
   industry-average returns at the lowest possible cost. I will not
   spend valuable marketing dollars on traditional and expensive media
   formats, or on "sexy" new media initiatives like advertising on
   popular, but irrelevant to the travel planning and decision process
   social media sites like YouTube, Facebook.com, MySpace.com, etc. I will
   not fall prey to the "Stockholm Syndrome" (advertise on online travel
   agencies where the advertising cost, in addition to hefty margins, can
   drive the total cost to my hotel to 30%-40% from booked hotel revenue).

3. I will re-evaluate the importance of my hotel's key customer segments and feeder markets
   in lieu of the economic downturn. Have my main feeder markets changed
   lately? Have my traditional key customer segments' contribution
   changed? I have already noticed a drop in my fly-in guests' share due
   to airfare hikes, cuts in corporate travel budgets, and reduced airline
   capacity, and I understand the need to focus more on my drive-in
   market. I will do a thorough customer segmentation analysis and take a
   hard look at how my property markets to my key customer segments (e.g.
   meeting planners, groups, business, leisure), as well as develop a
   marketing plan to target my most important feeder markets.

   I
   will continue building interactive relationships with my customers. In
   this new online environment I don't just want to provide great service
   to my guests, I want to "own" the customer throughout the travel
   planning and decision making cycle and not allow the third-party online
   intermediaries to own my customers. I will focus on building customer
   loyalty via reward programs and other eCRM initiatives.

4. I will become a smarter eMarketer in 2009.
   I understand how important it is to track conversions on my website and
   ROIs from my Internet marketing campaigns and figure out what works and
   what doesn't. In 2009 I will track the post-impression and post-click
   activity of each campaign and track conversions (bookings, room nights,
   revenues) from every campaign. I will implement the latest website
   analytics + campaign tracking technology to track ROI from my online
   marketing efforts and adjust marketing spend instantaneously based on
   ROIs.  I will know exactly which Internet marketing campaigns-search
   marketing, email marketing, display advertising, strategic linking,
   etc.-produce bookings and revenues, how much and at what ROI.

   I
   will become ROI-centric. I know that measuring ROI is the last priority
   for many vendors out there. I will no longer accept excuses from my
   interactive vendors about how difficult it is to track conversions and
   ROAS and that the "technology is simply not there". I will only work
   with an Internet marketing vendor that provides a comprehensive
   Internet marketing strategy and focuses on online marketing formats
   that generate the highest ROIs. I will demand full transparency in fees
   and marketing spend, and accountability for results. I will require
   24/7 access to state-of-the-art website analytical and campaign
   tracking tools, utilization of industry's best practices, and marketing
   spend that can be tracked. If my current vendors cannot accommodate my
   hotel, I will replace them in a heartbeat.

5. I will re-evaluate my hotel marketing strategy to provide a Unique Value Proposition to
   my customers. I will create unique hotel offers based on unique product
   attributes. I will not be competing only on price. I know that I will
   never be able to attract and retain more sophisticated travel shoppers
   and more affluent customers if I compete on price alone. I understand
   that the online travel agencies have been responsible to a great extent
   for the commoditization of the hotel product and services.

   I
   will work hard against any further commoditization of my hotel product
   and services. I will identify unique aspects of my hotel product and
   destination, and develop a differentiated approach to reach my key
   customer segments by creating unique specials and packages,
   event-related getaways, and seasonal promotions.

6. I will develop my hotel's differentiation strategy to "stand out" amongst my competitors.  I
   understand that in an economic downturn, when all my competitors are
   slashing prices and competing on rate alone, I have to distinguish my
   hotel to attract more discriminating customers, achieve higher ADRs and
   increase market share. To set my hotel apart from the online travel
   agencies, I will stay within rate parity, but provide additional value
   such as resort or dining credits, room/suite upgrades, etc. if guests
   book on my site. To differentiate my hotel from the comp set, I will
   offer what my competition does not: a broader selection of specials and
   packages in a variety that my customers can appreciate: seasonal
   specials, suite specials, weekend specials, family specials, romantic
   getaways.

7. In 2009 I will continue making the direct online channel the
   centerpiece of my Internet strategy because I know it provides my hotel
   company with immediate results in a very difficult economic environment
   as well as long-term competitive advantages.  I know that the leading
   hospitality brands already enjoy a very healthy 76:24 direct vs.
   indirect online distribution ratio, and Direct Online Channel sales
   will exceed 61% for the industry as a whole in 2009. I will maintain
   strict rate parity across all marketing channels and maintain a best
   rate guarantee, while at the same time creating unique product
   offerings to provide a unique value proposition to my customers. I will
   employ a comprehensive Direct Online Channel strategy to significantly
   increase my direct online sales and shift bookings from more expensive
   distribution channels to the least expensive channel-my hotel website.

8. I will optimize and if needed re-design my hotel website in 2009.
   I know that hotel Internet marketing starts and ends with the hotel
   website and my site has become the first, and in many cases, the last
   point of contact with the travel consumer. I understand that the site
   is the hotel's most important marketing asset today and enhancing and
   optimizing the hotel website should be a top priority in 2009. I will
   aim to enhance my hotel website's user-friendliness, search
   engine-friendliness, travel booker-friendliness, and interactive
   relationship-friendliness, which will boost conversion rates, improve
   search engine rankings, and website revenues. I also know that a well
   done website optimization and enhancement or re-design will pay for
   itself within 3-4 months.

   I realize that if my site is over 12
   months old, a website optimization is due in 2009, in order to take
   full advantage of the much cheaper organic search related visitors my
   your site. I also know that if my site is over 2-3 years old, a website
   re-design should be considered, or at least budgeted for late 2009. I
   know that my website should "speak" to two distinct audiences: travel
   consumers to whom the site must comprehensively describe all aspects of
   the hotel product and services, and the search engines, for which the
   site must adhere to best practices related to H1 headers, body copy
   (keyword density), page titles, description tags and keyword tags.

9. I will re-consider my hotel's Web 2.0/Social Media Strategy and implement effective, yet inexpensive, initiatives as part of my comprehensive direct Internet marketing strategy.

   I
   want to listen to what my customers are saying. I know that by adopting
   best practices for monitoring customer review sites I can not only gain
   unfiltered insights into the customer experience and immediately
   address any issues and act appropriately, but I can also attract new
   customers.  On the other hand I know that I can establish interactive
   relationships with my customers via Web 2.0/Social Media initiatives on
   my website such as expert blogs, consumer experience and photo sharing,
   contests and sweepstakes, etc.

10. I will take a hard look at how Best Industry Practices
    are being utilized in my hotel Internet marketing strategies and by my
    hotel's Internet marketing vendors. I know that now, after almost 14
    years since the first online hotel booking, best practices have been
    established in practically every aspect of hotel Internet marketing. I
    do not want my Internet marketing vendors to "learn the business on my
    dime".  I will make it my mission to acquire new core competencies and
    adopt best industry practices by partnering with leading hospitality
    experts in Internet marketing and direct online channel strategies.

    I
    like to have a crystal-clear understanding of what the best practices
    and latest trends are in Internet marketing in hospitality. What works,
    what doesn't, and why. I recognize I don't have all the answers and
    that there are thought leaders and other proven professionals who can
    help me and my hotel stay competitive in these dire times, preserve and
    increase market share, and generate the highest website revenues and
    ROIs.

    I will work with Internet marketing experts to disseminate
    eKnowledge and best practices, making my team stakeholders in the
    corporate Internet marketing efforts. I will hire experts who can teach
    me and my staff best practices and keep us apprised of the latest
    trends. These Internet marketing practitioners will provide crucial
    professional development as well as guide our direct Internet marketing
    strategies, online brand building strategies, e-CRM, website re-design
    and optimization, search and email marketing, and Web 2.0 initiatives. 

Note: Mariana Mechoso, Manager eMarketing Services at HeBS, also contributed to this article.

About the Authors and HeBS:

Max
Starkov is Chief eBusiness Strategist and Jason Price is EVP at
Hospitality eBusiness Strategies (HeBS), the industry's leading
Internet marketing strategy consulting firm for the hospitality
vertical, is based in New York City (www.hospitalityebusiness.com).
HeBS has pioneered many of the "best practices" in hotel Internet
marketing and direct online distribution. The firm specializes in
helping hoteliers build their direct Internet marketing and
distribution strategy, boost the hotel Internet marketing presence,
establish interactive relationships with their customers, and
significantly increase direct online bookings and ROIs.

A
diverse client portfolio of over 500 top tier major hotel brands,
luxury and boutique hotel brands, resorts and casinos, hotel management
companies, franchisees and independents, and CVBs has sought and
successfully taken advantage of the firm hospitality Internet marketing
expertise. Contact HeBS consultants at (212)752-8186 or info@hospitalityebusiness.com.

By Max Starkov & Jason Price