Wednesday, February 22, 2012

Is TripAdvisor Cost Per Click For You?

We recently published an article about the opportunity that Bookassist clients in Scotland have to compete with the online travels agents to buy direct clicks from TripAdvisor reveiews.
In follow up that we are linking to an excellent article that gives a really good insight into their experiment across more than fifty European hotels and how they benefitted (or not!)

The full article is linked at the foot of the page but here are the conclusions they drew - we're not sure that we would disagree with any of them to be honest.


So what is the key point in the decision making processes about whether to invest in Tripadvisor’s PPC program?

1. As a prerequisite, and as for any investment that will bring traffic to your official website, make sure that it is optimized to convert, offering the potential client the best experience regarding design, reservation engine, rates and also enough room availability.

2. High cost: 25-45% (again, this is related to your position). Compare it with other channels and decide whether the same investment would offer you a better return by other means. If you totally bet on your official website (which will probably collide with intermediation), the costs will be lower. Think that Tripadvisor is enabling the user to compare the rates, so even if the rate is not the only thing to take into consideration, the fact is that Tripadvisor really focuses on it.

3. Limited expenses control: Tripadvisor’s CPC Program doesn’t currently offer any control for the hotelier regarding the amount to invest because it doesn’t manage every account separately but rather in a global way along with other hotels. If you require to budget or control your cost in advance, this could be a problem for you. We hope this changes soon, but nowadays, you will be told the amount you invested by the end of the month instead of at the beginning.

4. The better your hotel’s position is within the pages of your destination, the more chances you will have to receive reservations by this means. Without a good position, it is even possible that you spend your money without getting any reservation at all.

5. It is better if your average reservation value is high. This will soften the fixed cost that involves the “pay per click” concept.

6. If you don’t participate directly, you will be feeding your intermediaries. Check out which of them are bidding. Paying 18%-25% in intermediation means that they are using a part of the incomes to bid in Tripadvisor, which would explain the current phenomenon: “booking/venere/expedia are selling more and more”. They are not going to pull out of the race, even if they pay the same or even more than you, so having a direct presence also comprises a political dimension that you should take into consideration.

7. Satisfy your clients. Life smiles at hotels that do so, and this test confirms it. The new ways of distribution that are arising, such as, Business Listing, and the social network, etc., need happy clients to work. Without their satisfaction, you’re out. Tripadvisor’s CPC, whose return is very sensitive to your ranking position within your city, is a materialised and quantifiable example of this trend of which everyone talks about abstractedly.

8. Trial and error. If you are in doubt, you’d better try it and see the numbers you get. No matter how far we take our analysis: every hotel is different from the rest and there is no way of checking whether this works for you other than trying it.

The full article can be read here

Bookassist in Scotland are now setting up TripAdvisor cost per click accounts for hotels. For more information call 01292 521404 or email Bookassist Scotland

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