There is often a lot of data to sort through for a hotel to find what holds value and what is actionable to determine the direction of your strategy. Outside sales and revenue management reports, the digital marketing KPIs can also be overwhelming.
As a General Manager or Sales Manager, it is best to focus on high level digital marketing KPIs that are specific to the hospitality industry, then start asking questions if something is not right. You should be able to glance over monthly reports and at least start challenging your vendors, partners and team.
Here are 10 high level KPIs for the hospitality industry to analyze when you are not a digital marketing expert good for a General Manager or Director of Sales to keep handy.
#1 Total Website Traffic
In its most basic form, is your website traffic growing year over year? If you are a new hotel, you should see a positive upward trend in website traffic. Make sure you are looking at “real traffic” and you have excluded non-converting traffic like people that land on your site after signing onto WiFi. If not trending positively year over year, ask these questions:
- Is it seasonal or were there big events affecting trends?
- Is there new competition in the market?
- What website source is down year over year? (Direct, organic, referrals, social, etc)
- Has my paid media budget and strategy changed?
#2 Organic Website Traffic
As seasonality affects demand in your hotel, it also affects how many people search for hotels in an area as well. Trying using Google Search Trends to identify seasonality in search. Remember this is when people are searching, not necessarily when they are looking to stay.
Avoid comparing month over month and compare year over year, when possible. Over time, your online presence should expand, thus resulting in more organic website traffic. If not trending positively year over year, ask these questions:
- What is my exposure for branded versus non-branded keywords?
- What is my average page rank on targeted keywords?
- Are my on-site and off-site search engine optimization strategy aligned?
- Am I getting 1-2% click through rate for my most relevant non-branded keywords?
#3 Social Media Engagement
Whatever the channel, focus on engagement, not followers. You could have a large base that doesn’t 1) care anymore or 2) doesn’t see your posts due to low engagement. Granted, not every post is a winner, but some should be. Focus on using social media as a direct 2-way communication with your past, present and future guests. There isn’t an exact metric you are looking for, but consider these questions.
- Are people liking, commenting and sharing your content from time to time?
- Do you see referrals from social to your website?
- Do you have a content calendar and someone responsible for social?
- Do you have funds dedicated to social?
#4 Domain Referrals
Are you well connected online in your local community? Sales teams often have many contacts, but fail to extend that relationship into the online world. If you are expected to be associated with a specific demand generator solely due to proximity, think again. Getting listed on local websites not only drive referring traffic, but also increase your search rankings. If you don’t see referrals from your CVB, Chamber and top local partners and demand generator, ask these questions:
- Am I promoting offers on these partner sites to stand out from the competition?
- Are my listings completely filled out with images, description, contact, etc?
- If local demand generators list hotels on their site, is my hotel one of them?
#5 Backlinks (or Linking Domains)
This number by itself has no value. But, it does hold value as a measurement against your competitors. This number defines how many online partners that Google finds valuable, thus directly affecting your search rankings. The goal: Have more linking domains than your competitors. Just be sure they are high quality sites and don’t go on a backlink buying spree as spammy sites hurt your SEO. You can use a tool like Moz Link Explorer without a paid membership to analyze your competitors’ online partners. If you have less, refer back to #4.
#6 Return on Investment (or Return on Ad Spend)
Keep your paid media spend in check. ROI will vary for different online channels, depending on your goals and where that exposure happens in the booking funnel. Also, a higher ROI isn’t always a better ROI. If you spent $50 and had a 20 to 1 ROI, what would have happened if you spent $500? Though likely you would not maintain a 20 to 1 ROI, would that have resulted in a decent ROI and true incremental revenue? If you feel your ROI is too low, ask these questions:
- Are my goals aligned with my expectations?
- Is my strategy aligned with my target market and selected channels?
- Is my budget big enough for what I want to achieve?
- Am I targeting guests in the right stage of the booking process?
Revenue Management plays a huge role in achieving ROIs in digital marketing. But, you should look for alignment between the people you are targeting to come to your website that they are aligning with bookings. Typical traffic to conversion ratios are 2.2%, where the top 20% convert around 5.6%, as identified by FastBooking. If you are lower than average, start asking yourself, or your team, these questions:
- Revenue Management: Are my rates competitive? Are the rates on my website competitive? Has the competitive set changed in some way?
- Website: Is it easy to find information and images about my hotel and surroundings easily on my website? Am I clearly differentiating myself from the competition on my site? Are there particular channels with a lower conversion rate?
- Booking Engine: Is the process to complete a reservation simple one? Do I clearly state my rates, rooms, terms and policies? Are the rooms and rate in the best order?
#8 Sentiment Analysis
What are people saying about you online? Read your reviews to see if strategy of who you are is aligned with who you want to be. If you have problems, fix them. If you have a reputation management platform, there is usually a Sentiment Analysis that groups the positives and negatives about what people are saying so you can look for trends. Don’t pat yourself on the back too early, most hotels have repeat positive comments about Staff. So unless you are top ranked on TripAdvisor, you can’t really say you can compete on good service.
#9 Channel Mix
This is a hard one because it depends on the hotel. There isn’t a perfect channel mix to define this digital marketing KPI in the hospitality industry. The goal is to not put all your eggs in one basket. Your website should be bringing in about a third, less if you are an independent hotel. Sales (or in-house) should also have about a third, more if you are an extended stay or hotel with a lot of meeting space. Online Travel Agencies (OTAs) aren’t always the bad guy. If you are in the 10-15% range, you are in good shape. Expect to use them more in slower seasons. Then the rest is spread among Global Distribution Systems (GDS) and a potential call center or phone reservations. If you are overly heavy in one area, ask these questions:
- How can you become better diversified?
- Are you over dependent on one segment or client?
- Are respective content and image audits of some channels required?
- Look at year over year trends for changes and have a team chat about goals moving forward.
#10 OTA Content Score
To keep optimal exposure on the major OTAs without offering discounts or participating in opaque, look at your content scores. This just ensures you have all the pertinent fields in terms of imagery and content filled out per their ever-changing standards. This is free to do and you probably want to check it quarterly. Here is more info on how to clean up your OTA content score.
Most of these digital marketing KPIs for the hospitality industry are not budget restrictive to review and audit. But, you should have a budget for your digital marketing and have it aligned with your sales plan and revenue goals with your revenue manager.
Final Thoughts on KPIs for Hospitality Industry
- Set goals for your vendors and partners. Be engaged with them on any planning or strategy calls.
- Audit your online channels periodically to ensure you are telling a consistent story with content and images.
- Ask questions, endlessly, until you understand.
If you are still lost and want help understanding the KPIs and story told by the analytics for your hotel, contact Cogwheel Marketing who can analyze both branded and independent hotels on a one time basis.