The Digital Divide, Affluent Style
When it comes to travel brands that cater to affluent customers, there’s a case of the have and have-nots. According to a survey released last week by affluent customer think tank L2, despite evidence of formidable ROI, hospitality’s digital advertising spend equates to only a third of funds allocated to non-digital channels. Companies such as The Four Seasons were at the top of the digital capabilities list. But companies such as Inter Continental were still not up to speed, according to the study.
As we indicated in our last affluent piece, some of the change in the travel business has been due to the short-term nature of affluent customer planning. L2 says that 70% of online bookings are for same-day reservations, likely translating to high price/margin bookings. But that also makes any kind of marketing more complicated. Brands would like to think they’re advertising to a customer that likes to plan in a business that demands planning. However, that’s not the case. We would like to point out three ways high-end brands can increase their digital capabilities.
Amp up the content: More than 61% of U.S Internet users research travel online prior to booking. That means content becomes more important in your ad and on your site. Example: If a hotel chain such as Four Seasons wants to get its affluent customer base excited about new destinations, the image and copy needs to reflect that. However, if a chain is trying to catch that new trend toward impulse booking, maybe it needs to customize its copy to show readiness in that area. The website content is just as important. Brands that invest in content curation register longer average user time on site and more return visitors, according to L2. For example, its data show that brands recruiting local staff to provide tips can increase user time on site by 16% and that users on brand sites with curated itineraries spend 12% more time browsing.
Remember email? It’s no surprise to us that email is still quite effective as a marketing tool. However, it was somewhat surprising that L2 found email remains the top choice for marketing communications across all age groups. Why, then, are high-end hotel brands behind the curve? Only 60% of hotel brands sent automated welcome emails, and only 56% engaged in email marketing communication. During our data collection period, hoteliers, second to last across multiple industries in email frequency rate, sent an average of 0.23 emails per week, a fraction of the number sent by brands in other sectors. We recommend that before moving on to mobile and social apps, which are admittedly far sexier these days, high-end companies get their email best practices in order.
Make social media work for you. Hoteliers deploying both global and property pages on Facebook rose from 73% in 2011 to 95% in 2012, according to L2. That’s great. But here again best practices need to be considered. Is social media simply providing a popularity metric for a travel company? Make sure social media efforts provide easy access to booking sites. Affluent customers can be found on social media sites, even the newest ones. Last month, research company Modea posted an infographic that brought to light some key Pinterest demographics: 28% of Pinterest users have household incomes of more than $100K; 68% of users are women; half are parents. Interestingly, 97% of Pinterest’s Facebook fans are women, which may indicate a much higher engagement rate among women. This data explain why Pinterest, initially written off as a social media fad, is quickly proving to be a popular marketing tool. In addition to its appeal among affluent women, Pinterest is appearing on analytics reports as a top referrer. It’s that referral power that makes social media effective for travel brands.
These three strategies might not place you at the top of the next survey. But without them a high-end brand simply cannot compete for customers in travel or any other vertical for that matter. It’s not about winning popularity contests. It’s about winning customers.