How Travelers Perceive Online Hotel Reviews and Ratings

... and Strategies Businesses Can Use to Drive Bookings

By Chris Campbell Chief Tracking Officer, Review Trackers | November 10, 2013

Travel planning has changed. Just ask any Web-searching, smartphone-brandishing, Instagram-loving traveler who fires up Google or TripAdvisor to find hotels, Expedia and KAYAK to book flights, Lonely Planet or Fodor's to finalize itineraries and tours. One would say it was inevitable: the emergence of a new generation of travelers, who-with practically limitless sources of travel information-have essentially become their own agents. (The tech-savvy ones, at least.)

The impact of the Internet, social media, and mobile technology on the travel industry probably couldn't be more evident than in the way an increasing number of people now rely on consumer-generated online reviews. In TripBarometer, a comprehensive accommodation and traveler survey based on the responses of over 35,000 participants around the world (the survey was conducted by review site TripAdvisor and market research firm StrategyOne), 93 percent of travelers said that their booking decisions were influenced ('a lot' or 'slightly') by online reviews. Meanwhile, 44 percent said that they chose their last property based solely on other travelers' reviews; this group came third, next only to those who decided based on price (76 percent) and location (68 percent). In another TripAdvisor survey, conducted this time with Forrester, nearly half (49 percent) of the respondents said that they wouldn't book accommodations in a property that doesn't have online reviews.

In short: the power that reviews have to shape consumers' decisions is undeniable.

The Rise of TripAdvisor, Yelp, and More

If a growing number of travelers are demanding these types of online content for planning their trips, well-there is no shortage of people volunteering to supply the information, either. Last March, TripAdvisor reached an impressive new milestone: 100 million reviews and opinions since its inception, covering 116,000 destinations. Also, as of June 2013, the company's branded sites were averaging a total of more than 230 million unique monthly visitors. As traffic continues to surge, so does the number of reviews-plus, of course, the people reading and writing them.

"The rise of TripAdvisor as the defacto standard for customer feedback on our industry has rapidly occurred," wrote talent management professional and Hospitality Gal founder Janet Gerhard in a recent article published in "The stagnant crowded field of marketing research has opened the door to social media reviews quickly outpacing customer experience rankings, whether internal or external, because of their ease in understanding and real-time accessibility."

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Coming up in October 2018...

Revenue Management: Getting it Right

Revenue Management has evolved into an indispensable area of hotel operations, chiefly responsible for setting forecasting and pricing strategies. Because the profession is relatively new to the hotel and hospitality industries, a clear-cut definition of what exactly Hotel Revenue Management is has only recently emerged - Selling the Right Room to the Right Client at the Right Moment at the Right Price on the Right Distribution Channel with the best commission efficiency. Though the profession can be summed up in a single sentence, that doesn't mean it's easy. In fact, it's an incredibly complicated and complex endeavor, relying on mountains of data from a wide range of sources that must be analyzed and interpreted in order to formulate concrete pricing strategies. To accomplish this, Revenue Managers rely on an array of sophisticated technology systems and software tools that generate a multitude of reports that are central to effective decision-making. As valuable as these current technology systems are, much of the information that's collected is based on past historical trends and performance. What's new is the coming of big, data-driven, predictive software and analytics, which is likely to be a game-changer for Revenue Managers. The software has the capacity to analyze all the relevant data and predict occupancy levels and room rates, maximizing hotel profitability in the process. Another new trend that some larger hotel chains are embracing is an emphasis on Booking Direct. For Revenue Managers, this is another new channel with its own sales and costs that have to be figured into the mix. The October issue of the Hotel Business Review will address these developments and document how some leading hotels are executing their revenue management strategies.