How to benefit from hotel metasearch on a limited budget

August 22, 2017

There’s a common perception among hoteliers that metasearch campaigns are highly complicated and tough to do on a budget. In the following post, we’ll bust open that myth by revealing some of the strategies that can make metasearch work and deliver your hotel a strong return on investment.

Sure, metasearch management can be tricky to understand, and OTAs do tend to dominate the major metasearch channels. But no matter what your budget, if you pick the right platform, spend wisely, and team up with an expert partner, metasearch can deliver impressive results and deliver your hotel an all-important boost in direct bookings.

Choosing the right channel

First and foremost, you’ve got to put your money wherever is most sensible. That means looking at channels that give you the maximum chance of conversion from the limited budget at your disposal.

So, where to start?

If there was one universal channel we’d recommend, it would be Google Hotel Ads. It’s the biggest metasearch site out there, and its current click volume now equals or surpasses TripAdvisor, while also offering a strong ROI.

Of course, there are hundreds of other options to pick from including major players such as Kayak, Trivago, and TripAdvisor. In the end, choosing the right metasearch platform involves understanding what’s best for your property, taking into consideration factors such as average cost-per-click, average ad position, rate parity, and the amount of direct bookings each platform generates.

In terms of an overall strategy, it’s generally best to spread your presence beyond just one platform. Through a process of cross-channel optimization, you can carefully refine the parameters of your advertising spend on different channels to gain the best overall ROI.

Widening your digital footprint in this way increases your overall exposure and offers a safer bet by sensibly spreading a limited budget. However, managing numerous online campaigns across multiple metasearch engines can be complicated. For that reason, it’s important to choose a top metasearch partner to remove the hassle from an otherwise daunting process.

Choosing the right metasearch partner: DerbySoft case study

As well as taking care of the technical process, top metasearch providers will offer your hotel invaluable advice on where your investment is best spent. However, not all metasearch providers are created equal and having the right partner with a platform flexible to meet your needs is essential.

As one of the leading metasearch bidding platforms in the marketplace, DerbySoft help hotels from around the world spend their investment wisely.

Making use of cross-channel optimization, the bidding platform is able to intelligently focus budget to the most profitable metasearch channels.

In a recent example, DerbySoft helped deliver a strong ROI for a client with hotels in the Middle East by recommending they advertise on Wego, a channel with a strong presence in the region as well as North Africa. The client has since seen a hefty 25% of its revenue share come from Wego.

Targeting a key geographical area on the right platform has played a decisive role in this client’s success with Wego. But other factors have also proved instrumental.

For instance, the client has a mobile optimized website that’s proved imperative to engage with Wego’s users, 60% of whom have a mobile device. In addition, the client offers native language support, and transactions are available on both Arabic and English landing pages to account for the needs of Wego’s target audience.

Along with the improvements to ROAS, DerbySoft’s client has seen month-on-month revenue increase by an average of 9%.

A tailored approach

DerbySoft’s recommendations have helped their client maximize ROI by targeting relevant platforms and engaging effectively with local audiences. It’s a perfect example of why understanding your audience is so important, and how spending a budget carefully in the right place can be so effective.

But success isn’t only for those targeting growing markets. By focusing on main markets in countries like USA and Canada, which offer the highest returns, clients have seen ROAS improve by as high as 20%. This hyper local bidding strategy works because the client place their efforts in maintaining rate parity and/or having the most competitive rates. There are also cases where some channels may not achieve target performance, but are still worth advertising on. As per the example above, the client advertising on Wego also advertises on TripAdvisor because of its huge popularity as a research and booking platform.

Clients with smaller budgets may instead prefer to target key markets to assist in converting users. In these cases, DerbySoft approaches the bidding process by focusing on the best combination of channel placement, markets, hotels, and devices to achieve the desired ad position.

Different platforms may require different bidding models

It’s also important to note that using the same bidding model on all metasearch platforms may not be the best approach. For that reason, research and experimentation are both required to work out how to bid on each site successfully.

While it might sound counterintuitive, bidding for the top spot isn’t always the best approach—especially if your budget is limited. Being in the number one position might earn you more clicks and generate more exposure, but the increased traffic at a higher cost per click can make all the difference when it comes to your ROI.

So in actual fact, settling for a slightly lower average position could end up giving you a better ROI at a lower overall cost.

That said, it’s important to stress that settling for a lower spot shouldn’t be considered standard practice. There will be times when bidding for the number one position absolutely makes sense. In the end, constant testing with different metasearch sites is the key to discovering where the balance lies.

Price parity is crucial

It’s important to remember that metasearch sites are shopping sites. People visit them when they’re ready to book and looking for the best deal. So you need to get your room rates spot on.

If your rates are even one dollar higher, you’re giving online shoppers an easy reason to ignore your listing. While it’s an easy mistake to make, having rates out of parity with the competition is one of the biggest reasons that metasearch campaigns fail.

In the battle for attention and bookings, there are two simple ways to win. You can either be the same price as everyone else, but feature higher up the search results, or you can have a lower price than everyone else. It’s that simple.

Finding a balance isn’t easy, and it does take time to perfect your bidding strategy. In addition, your ad position can change depending on the activity of your competition, which is why metasearch isn’t something you can simply set and forget.

The value of metasearch

Far from being a luxury, metasearch should be seen as a necessity that your hotel needs to stay competitive. If you haven’t got a presence on any of the metasearch platforms, you’re effectively giving direct bookings away to the OTAs and paying them costly commission fees in the process.

The truth is metasearch can be done on a budget, with the potential to see a good ROI when done in the right way. The key to success involves understanding which platforms work best for your hotel and which geographical areas to target, as well as offering competitive rates and tailoring your bidding strategy for each platform you use.

By collaborating with a great metasearch partner, all of these considerations can be made a whole lot easier.