Using Paid Search for Hotels to Maximize Your Return
By Michael Coughlin Managing Director, Digital Blue Creative | July 24, 2016
Since its infancy in the late 90s and early 2000s, paid search has been a highly effective tactic for capturing would-be travelers that are actively exploring travel options. There's seemingly no better way to attain a new hotel guest than by delivering an ad promoting your hotel when someone is searching for "hotels" in your market area. For instance, if you are promoting hotel rooms in Las Vegas, you would likely deliver relevant ads to people searching for keywords such as "Las Vegas hotel," "Las Vegas hotels," and "Vegas hotel reviews. "According to Prognosis Digital, 79% of people that book hotels online search for that particular hotel on a search engine before buying. Thus, having a presence on search engines is essential for any hotel.
Part of the reason paid search is so attractive to advertisers is that it's "easy" to manage. Google AdWords, the world's largest paid search marketing platform, is a self-service tool that allows you to quickly and easily write 95 character ad copies and pair them up with keywords relevant to your business. Google was created as a 'plug and play' type platform on purpose. The company and its investors want as many companies as possible leveraging AdWords to market their businesses.
Google AdWords offers flexibility that previous advertising channels never allowed. There's no minimum amount of money you need to spend. You can start and stop your campaign any time you please. Previously, you had to buy banners on a flat rate CPM (Cost Per Thousand Impressions) with a minimum cost and contractually-bound flight dates. Even before online media, you had to pay a flat rate at thousands of dollars to run a print ad or TV commercial. As with most offline advertising, you had to hire service providers or ad agencies who spent years cultivating media relationships and building teams of artists and media buyers to produce your ads and get them in front of the right audience. Now, thanks to search, you can pretty much create and deliver ads on your own.
The early adopters of search engine marketing first discovered the search engines as "digital blue oceans," or low competitive market spaces, with customers ripe for the picking. However, as the paid search skillset diffused and free training became abundant, the search engines have become crowded. This is good news for Google since its revenue grows with an increase in competition, but for advertisers, the opposite is true. Increased competition creates click price inflation and divides impressions over near limitless amount of competition. To accelerate growth, Google continues to give away "free money" to small businesses, which actually helps boost overall click prices for existing advertisers.
While the search engine marketing space is great for a price conscious consumer, it is becoming increasingly costly and difficult to master for the advertiser. When a competing hotel offers a certain promotion or discount, others likely need to match them to attract the same customers. As the search results get increasingly crowded, the click prices go up, competition begins to homogenize, and profits shrink for everyone except Google.
Not only has the search marketplace gotten more crowded, but Google has made the paid search game more complicated. On a frequent basis, they make significant changes to the platform and its policies that can cause even the most experienced paid search marketer to spend their marketing budget recklessly. The following tactics and strategies are essential to keep in mind when marketing your hotel brand on Google or other search engines.