Thursday, January 8, 2015

Hospitality Marketing Trends For 2015

PhoCusWright recently released its year-end travel report “The Phocuswright Yearbook 2014, The Year Ahead in Digital Travel.” The summary included a number of important hospitality marketing developments and future trends as well. Marketing trends for hoteliers in 2015 look, to a large extent, to be a continuation of developments from the previous year.  

 

Social Media and Video

Hospitality spending, as a part of the whole travel industry, on ads is steadily rising. Also, those dollars are increasingly being spent on online campaigns, particularly on social media and utilizing videos. According to the Phocuswright study, 2013 was the first year that saw online ad spending surpass offline spending, with the difference predicted to become even more pronounced by 2015. Most travel advertising dollars, 2 in 5, are being spent on search ads.

However, Phocuswright sees a clear trend toward those dollars being spent on the social media and video platforms. Additionally, mobile ads and programmatic display ads on networks such as YouTube are on the increase as well. During 2015, Phocuswright projects social and video will reach the level of 18 percent of all digital travel advertising.

 

The Millennial Traveler

In sheer numbers the largest market segment of travelers is the millennial generation, those born between 1977 and 2000. The 80 million strong generation of American consumers make up a full 25 percent of the total U.S. population. They are the future of travel and already the older end (25 to 34 year olds) of the millennial generation comprises the largest percentage of travelers by age group. The Phocuswright study states millennials are also twice as likely to take long trips of over 14 nights or more. However, they also are extremely budget conscious as a group, spending less than older travelers.

The millennial generation has grown up in a world of instant gratification leading to the expectation of planning and booking their travel and lodging arrangements in the last minute. The study found that 23 percent of millennial travelers booked their last trip less than a week before. For older travelers the figure is only 12 percent for last minute booking. Brand loyalty and associated loyalty programs are less motivating factors for millennials, who prefer to make their travel decisions after checking with multiple websites to ensure they are getting the best deal possible.

Before millennials reach the pinnacle of their earning and spending potential, hotels should attempt to establish a relationship with millennials and build brand loyalty with the generation, who will be their core customers in the very near future. The best way for hotels to begin engagement with the millennial traveler is to meet them where they spend much of their time, on their mobile smartphones. Figures from Phocuswright indicate that 36 percent of millennials select a travel destination on smartphones. 37 percent shop for the best deals via smartphone. And finally, 23 percent will actually book on their mobile smartphone. This is as compared with 6,11, and 5 percent respectively for older travelers.

 

The Rental Traveler

Another growing trend is the traveler who rents accommodations, as opposed to booking a hotel stay. This is particularly, again, a trend among millennials who have embraced the so called “sharing economy”. While vacation rentals have been around for sometime, websites such as Airbnb, among others, have facilitated this trend. In the U.S. this amounted to a $24 billion dollar market in 2012. While the percentage of travelers who rent is growing steadily, rising from 8 percent in 2010 to 14 percent in 2013.

This is a trend worthy of awareness for hoteliers, however during the same time frame hotel and lodging revenue has steadily grown from $107 billion to $123 billion in 2013. The rental traveler is costing hotels some business, but should not be cause for concern in the hospitality industry. 


Posted via OnFast - http://www.OnFast.com

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