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Andy KhenHotel E-Commerce101
Goals
Short-term
Revenue Generator
Online Exposure
Long-term
Sustainability Loyalty
GoalsShort and Long Term
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Andy KhenHotel E-Commerce101
AIM
Room and Non-Room Revenue
Offline and online
Expanding the Online Revenue
Find the most cost-effective channels to distribute the room inventory
Decrease the Distribution Costs
“Always aim for achievement. Forget about success.” (Helen Heyes, n.d.)
&
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Andy KhenHotel E-Commerce101
The FocusFocusing on the Basics
“Concentration – Important to our success.” (Ingvar Kamprad, 1976)
ACCOUNT MANAGEMENT CONVERSIONVISIBILITY
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Andy KhenHotel E-Commerce101
Online
Channels
Description
(RTB & USP)
Photos
Reviews
Content ManagementImproving online presentation
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Andy KhenHotel E-Commerce101
Brand.com
Higher
ARR
Increasing
Loyalty
Better
Presentation
Direct DistributionFocus on high yield channel
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Andy KhenHotel E-Commerce101
Partner
Partner with banks, airlines, Railway, etc by providing their clients and employees with special rates when booking online
Each partner is provided with specific booking code
Shared marketing efforts such as LED, Billboard, e-blast, etc
Increasing bookings from brand.com via 3rd parties
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Andy KhenHotel E-Commerce101
Rates
BAR
Premium
Published
Discounted
Rate FencesProviding wider options as to grab wider market segments
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Andy KhenHotel E-Commerce101
Dynamic & Multi-Pricing ApproachLeverage Rate and Time
Maximise Occupancy Maximise ARR Maximise RevPAR Maximise Revenue
Room Guest Time Location
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Andy KhenHotel E-Commerce101www.swiss-belhotel.com
BAR:
dynamic based on occupancy
Discounted Rates: advanced purchased, etc -discounted based on BAR
Premium Rates:
packages, added-value offers
Published Rates:
static
Rates
Multiple & Dynamic PricingMaximising RevPAR
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Andy KhenHotel E-Commerce101
Multiple Pricing ApproachMaximising Revenue
Revenue 1€250 x 150 €37,500
Revenue 2€350 x 100 €250 x 50€200 x 50---------------€57,500
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Andy KhenHotel E-Commerce101
Prospect Theory
Professor Kahneman (Nobel Prize winner) & Amos Tversky in 1979
It is easier to get customers who have already committed to purchase to spend an additional amount (the amount of an upgrade, for example) than it is to get them to make the more expensive purchase at the initial decision point.
Upsell & Upgrade
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Andy KhenHotel E-Commerce101
Cost Effective
Protect Rate Integrity
Generate More
Bookings
OTA’s ManagementThe 80/20 Rule
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Andy KhenHotel E-Commerce101
Group Priority List of OTA’s Local OTA’s Note
A High ABC
Available at all times
B Medium DEF
GHI
Medium – low periods
C Low JK
LMN
Low periods
OTA’s GroupingImproving inventory management
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Andy KhenHotel E-Commerce101
Fixed contracted
rates
Minimum online selling
rates
Fully controlled allotments
Online WholesalersLeveraging the networks of wholesalers
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Andy KhenHotel E-Commerce101
• In 2012, online bookings in APAC were still dominated by online suppliers accounted more than 60% from the total online production
• List of online wholesalers: Hotelbeds, GTA, Jactravel, Transhotel, DOTW
• Local online wholesalers (Indonesian): Mandira Abadi, MG Holiday
• Autralian wholesalers: Flight Center, The Travel Corporation (Creative Holidays & New Horizons), GOH holidays, Qantas Holidays & Asia Escape Holidays
Wholesaler Account ManagementExpanding the wholesaler accounts
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Andy KhenHotel E-Commerce101
Marketing exposure
Segmented market
Excess rooms, low
period
Coupons, no
allotments
Flash Sale SitesUsing group buying sites during low periods
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Andy KhenHotel E-Commerce101
Billboard EffectOTA’s and social media channel as online marketing tools
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Andy KhenHotel E-Commerce101
Chris Anderson (Cornell, 2009): Billboard Effect
JHM Hotels in the US , 4 of 35 properties taken as study objects
Listed on Expedia on and off in a circle of 7 – 11 days for 3 months
Findings: reservation on non-OTA channels (eg. Brand.com) increased by 7.5 – 26% when being listed on Expedia
OTA’s and their indirect impact to direct channels
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Andy KhenHotel E-Commerce101
UPC or Prepayment
Connected to channel manager
Cost-effective
commission
Rules for New OTA AccountEvery contract is a cost; hence we have to ensure production
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Andy KhenHotel E-Commerce101
Sky Scanner
Trivago
Wego
Meta Search SitesLeverage the meta search sites to increase visibility
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Andy KhenHotel E-Commerce101
• Customer Contact Management
• Multiple Online Payments
• Competitor Monitoring
• Review Scores
Competitive Rates
Constant Availability
Informative Hotel
Description
Sufficient Photos
Conversion
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Andy KhenHotel E-Commerce101
Guest Interaction:
Quizzes
Complain handling
Inquiry
Marketing
Sales
Social MediaFreebies, quizzes, etc
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Andy KhenHotel E-Commerce101
TripAdvisor
Online Banners
Google Map
SEMAs a supplement to SEO
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Andy KhenHotel E-Commerce101
Online Reputation ManagementLeverage online reviews to increase brand competitiveness
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Andy KhenHotel E-Commerce101
Main Factors People Book A HotelMost people choose a hotel because of the reviews
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Andy KhenHotel E-Commerce101
”If a hotel increases its review scores by 1 point on a 5-point scale (e.g., from 3.3 to 4.3), the hotel can increase price by 11.2 percent and still maintain the same occupancy or market share”.
Professor Chris Anderson, Cornell University,,2012
Relation between Reviews & ARRStudy from Cornell University
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Andy KhenHotel E-Commerce101
Reputation Management“More than 70% guests read reviews before booking a hotel…” (Michael Menis, IHG)
o Monitor and response reviews in timely manners;
o Use Reputation Management software when possible;
o Adopt pro-active approach (as opposed to passive approach) to get reviews from guests;
o Measure and monitor NPS (Net Promoting Scores) of each property and or brand.
Online Reviews Word of MouthIn-hotel Reviews NPS