The impending holiday travel season offers a wealth of new opportunities for hospitality brands, alongside both new and old challenges. In order to make the most of it, the best strategies will be rooted in data-driven thinking and a unified measurement approach powered by commercial mix modeling – a framework that can provide both strategic and tactical results. So, let’s take a closer look at the three biggest considerations hospitality marketers should keep in mind as the holidays approach:
- 1. Invest in Brand Equity Messaging: During a time when regulations vary not only state by state, but even county by county, any national media messaging execution needs to be applicable to all consumers. Themes of safety, cleanliness, resilience, and trust are a smart bet, but should be wrapped up into a larger message of brand equity. In fact, messaging that focuses on the values of a brand outperform product, promotion or functionality messaging 80% of the time, and when that equity messaging is focused on a “mega brand”, it can generate a halo effect that positively impacts all of the sub-brands within it.
- 2. Reevaluate Your Media Mix: National planning is key, but now is also a critical time to plan on a regional level. Hyper-targeted online advertising based on geolocation, in additional to broader brand equity messaging, is a wise decision. This is indicative of the overall need for hospitality marketers to take a hard look at their media mix and understand what the sales impact is by channel. All media has omnichannel impact, but the mix can and should vary based on KPIs and consumer behavior. For example, online bookings are driven by both online and offline tactics, meaning that online advertising is not the only tactic that should be considered when looking to increase bookings. Our ROI Genome research has shown that in some recent cases, over half of website traffic was actually driven by TV.
- 3. Plan for Multiple Potential Outcomes: Hospitality marketers should not be throwing out the data of the past as the world settles into the new normal. Rather, they should be using historical data as a foundation for future success through scenario planning and forecasting. Building scenarios that incorporate established facts and known cause-and-effect relationships can still allow for unknowns, but those unknowns should be grounded in data and realistic assumptions about change in the industry. When considering a scenario planning framework, every smart strategy should take into account three things: measurements of success, performance drivers and key considerations, including critical business dynamics. The key to scenario planning is to accurately identify relationships between performance and business drivers (including marketing and non-marketing, internal and external) and leverage that knowledge to map out not a single forecast, but a range of possible futures.
While a major comeback in 2020 is an unlikely scenario for hospitality brands, it is still a smart time to invest in marketing, rather than pull back. The economy may be uncertain, but 60% of brands saw ROI improvement during the last recession, and brands who increased media investment during challenging times realized a 17% growth in incremental sales. Overall, our ROI Genome data found that brands that reduce their media spend in 2020 by $50MM will on average stand to lose $130MM in revenue in 2020 alone. Now that budgets are bouncing back, smart spending is critical through Q4 and beyond.
Marketers who are attuned to the importance of brand equity messaging, willing to be flexibly in their media mix, and lay a foundation for scenario planning will not only weather the storm that has been 2020 thus far, but also come out on the other side with a plan to find even greater success in the future.
- Kristin Moody, AVP