Dan Siroker, former deputy New Media Director of the Obama Presidential Transition, gave a keynote presentation at SES Chicago in December about how he and his team used Data to win the Obama presidential election, and the lessons they learned along the way. Your hotel can learn from these lessons and apply them in your own internet marketing campaign.

Before joining the campaign, Siroker was a product manager for Google Chrome. He saw Obama speak at a visit to Google¹ and he was inspired to help him with the new media aspect of his campaign. Two weeks later, Dan moved to Chicago for a month where he did whatever he could to help the campaign. He then officially joined the campaign as the director of analytics.

Dan showed us how the campaign structure worked with Barack Obama on the top tier, followed by David Plouffe, the campaign manager, and then the departments of correspondence, field, policy, operations, communications, new media, paid media, and finance. New media was then divided into marketing, e-mail, blog, analytics, design, video and organizing.

Before going into the details of the campaign, Siroker reminded us that Obama won with 365 electoral votes as opposed to 173 electoral votes for McCain. In the popular vote Obama had 53% percent of votes (69,456,897), and McCain had 46% of votes (59,934,814).

As we all saw, the Obama new media campaign triumphed over McCain’s. Below is a screenshot of one of Dan’s slides which reveals the drastic difference in the number of Facebook friends, YouTube video views, and unique website visitors that the Obama campaign attracted as opposed to the McCain campaign.

Through their online efforts, the Obama team dramatically surpassed the McCain team in terms of money raised. The Obama team raised a total of $656 million and $500 million of that came from their online campaign as seen in the slide below.

The online marketing campaign was unprecedented in any other presidential election. You have probably read articles and seen interviews about the innovative process and the talent of the people involved. Barack Obama wrote about it himself in his book, ‘The Audacity of Hope: Thoughts on Reclaiming the American Dream.’ Obama’s campaign manager, David Plouffe, also recently wrote a memoir about the campaign titled, ‘The Audacity to Win.’

Dan Siroker helped mastermind the online efforts and we were eager to hear what he had to say about the campaign. Below is a re-cap of the lessons they learned, and our thoughts on how your hotel can benefit from those lessons.

Lessons Learned

Lesson #1: Define Success

Or rather, Define Quantifiable Success Metrics. Obviously the main goal for the Obama team was for Obama to win the election. For the team managing the online campaign they defined it this way: website > email signup > raise money. They could measure the success by cost-per-click, sign up rate and money per recipient.

What is the definition of success for your hotel’s online efforts? Most likely it is to increase bookings and revenue. Have you set specific goals for your internet marketing campaign? Are you measuring the success of your campaign?  Success can also consist of increasing your online presence, building a brand voice, capturing e-mail addresses, managing your online reputation, or building relationships with your audience through social media.

Lesson #2: Question Assumptions

Dan never just followed assumptions that their online material would be effective in achieving their goal of gaining supporters and raising money. Instead he and his team tested different layouts of the material and used the data to determine what elements motivated people to take action.

As an example, Dan showed us how his team used testing on a splash page they created to encourage people to sign up for the e-mail list. They did not just create a page that thought would be effective, rather they created different versions and used multivariate testing through Google Optimizer to test which button and image proved most effective in getting people to sign up. They tested four different buttons, Sign up, Learn More, Join Us Now, and Sign Up Now. They also tested 3 images and 3 videos.

Before Dan showed us the splash page that was most effective, he tested us to prove his point that assumptions are often wrong. He showed us the variations of the splash page and asked us what we thought would work the best. In the end only 2 people in the audience had assumed correctly. Below is the image of the winning splash page which was most compelling in encouraging visitors to sign up.

The new layout resulted in an increase in conversions from 8.2% to 11.6%, which is an observed improvement of 40%. This means that they went from 1000 conversions to 1500 conversions. Dan explained that it may not seem like much presented that way, but through the life of the campaign it would translate into 4 million more people that signed up.

Does your hotel make decisions based on assumptions about what will appeal to your audience, or do you test to see which layouts of your online material are most effective? You should test everything from website pages, landing pages, e-mail campaigns, and PPC ads. You can also test landing pages for free with Google Optimizer.² Testing helped the Obama team increase conversions, and it can also help your hotel increase bookings.

Lesson #3: Divide and Conquer

Another lesson the team learned is that different elements appeal to different users. This became clear when the team attempted to test a donate button.  The variables included, Donate Now, Please Donate, Why Donate? Donate and Get a Gift, or Contribute. Again Dan conducted a quick test with the conference audience to see what we thought would be most effective. Again, we were wrong.

This time it turned out that there was not just one correct answer because it depended on who you were as a visitor. Through testing they discovered that people who had never signed up before favored the ‘Donate & Get A Gift,’ those who had signed up but didn’t donate preferred the ‘Please Donate’ button, and those who previously donated preferred the ‘Contribute’ button, as seen in the slide below.

Your hotel can also divide and conquer. You must profile your guests which will allow you to send very targeted messaging to individuals. Learn about your guests and record if they are at your hotel for leisure, a wedding, a meeting, or business. Note their interests. Did they use the fitness center or visit the spa? Did they dine at the restaurant or do they prefer room service? It is also important to segment your guests into new guests, return guests or regular guests. Once you have this information you can create e-mail campaigns that will appeal to the individual guest. Again, test your landing pages and e-mail campaigns to learn which combination of design elements will be most effective in encouraging conversions.

Lesson 4: Take Advantage of Circumstances

Dan stressed the importance of taking advantage of circumstances. He gave us an example of a time when Sara Palin specifically mocked Barack’s experience as a community organizer on the South Side of Chicago. David Plouffe and his team then sent out letters to their supporters explaining the situation and asked them to make a donation. This e-mail resulted in 10 million dollars within 24 hours! Below is a screenshot of the letter.

Is your hotel taking advantage of circumstances? Circumstances can include everything from the weather, the economy, holidays, school vacations, your competition, to conferences or special events in your town. Listen in social media to find out what people are saying about your hotel, or your town, or upcoming events. You can use Twitter search or Tweetbeep to listen in. If you see that someone may be looking for a hotel in your city, respond to them. Take advantage of circumstances and you can greatly increase bookings.

Lesson 5: Turn Your Customers Into Evangelists

Dan said they turned their supporters into evangelists everyday through their blog and YouTube channels. Here they focused more on the supporters rather than the candidate. He feels that other campaigns missed the boat here.

For example, the Obama team created videos that motivated others to get involved. One such video, Charles Meets Barack³, focused on one of the volunteers who won a raffle to meet Barack. This video was released only 28 days before the election but generated over ½ million YouTube views. The video also received a lot of press coverage because of the process story of social media transforming politics. Social media made it easy for supporters to share content and recruit new supporters.

Do you have evangelists for your hotel? You probably do have regular guests who recommend your hotel to their friends and family. Encourage them to share your offers and content by placing Share With Your Network icons on your e-mail campaigns. These icons can link to Facebook and Twitter and make it very easy for them to pass your message on to their own contacts. Find out who your evangelists are and encourage them to write a review of your hotel. Encourage guests to create their own photos and videos about your hotel. Again, listen in on social media to learn what people are saying about your hotel and create new relationships that could result in new evangelists.

Create Evangalists for your hotel with Spreadly

Dan took the idea of social media and combined it with affiliate marketing to create a new program called Spreadly⁴.  Spreadly is a social affiliate marketing program any online merchant can use to turn their customers into evangelists. The idea behind Spreadly is that a business can help support a cause and the cause is the reason why people start talking about the business.

Spreadly provides users with a widget that they can place on their purchase confirmation page. Customers can then choose a cause they are interested in and Spreadly creates a referral link where users can easily share the information through Twitter, Facebook, or E-Mail. Your company vows to pay $5 (or amount agreed) for every purchase that their friend makes. If you are interested in using this program you can request an early partner account on the site www.spreadly.com.

In closing, below is a quick re-cap of the Lessons Learned From the Obama Campaign:

Lesson #1: Define Success

Lesson #2: Question Assumptions

Lesson #3: Divide and Conquer

Lesson #4: Take Advantage of Circumstances

Lesson #5: Turn Your Customers Into Evangelists

Try some of these tactics in 2010. If they were effective enough to help win the presidential election there is a high probability they can help your hotel increase bookings.

If you would like to learn more about how Internet Marketing can help your hotel, please call us at 978-465-5955 or write an e-mail to info@orourkehospitality.

* Slides courtesy of Dan Siroker

1 Candidates@Google: Barack Obama Video

2 Google Website Optimizer

3 Charles meets Barack

4 Spreadly

If you have analytics installed on your website then you have access to this information. However, our research this month revealed that 41.8% of New England first class and luxury hotels don’t have analytics installed on their website!

What is Analytics Software?

Analytics software is a tool that gathers information about how people find your site, how they navigate through it, and how they become customers. You embed a JavaScript code into your web pages which will collect data from your users. You will then be able to view and analyze a great deal of data including how people entered your site (i.e. a banner ad, an article, or the search engines), what pages they visited, how long they spent on your site, what pages they exited on, what percentage of people left your site quickly (bounce rate), what content and keywords are most successful, and much more.

There are many software packages available, but the most popular are Google Analytics, Webtrends, and Omniture. Google Analytics is a very effective software that covers all the basics of tracking, and it is completely free. Omniture and Webtrends are paid software which will allow the user to delve deeper into the analytics and are best for very large e-commerce sites.

We recommend hotels use Google Analytics because it is a quality software that will provide you with a high-level of data at no cost. If your hotel brand has hundreds of properties, or a large complex website, you may consider paying for Omniture or Webtrends, however those sites may be overkill for most properties.  For purposes of this article we will focus on Google Analytics.

Why Does My Hotel Need Analytics?

If you aren’t tracking your website and internet marketing efforts you will never know if they are effective or what your return on investment is. You should decide what to track, set goals, and create reports that show how results tie back to goals. Below is an outline of why your hotel should use analytics:

• Analytics can help your hotel detect problems with your website

Tracking allows you to analyze user behavior on your site which will help you identify if there are any problems on your site that need to be fixed. Analytics will tell you what the most popular pages on your site are, the average time users spend on each page, the pages a user visited before and after, and where the user exited your site. It will also show you the bounce rate which is the percentage of people who entered your site but left immediately without looking at other pages or links. If you analyze this data you can learn a lot about the content of your website and what works and what doesn’t.

If a user is on your site and proceeds to the reservations page, but then exits before booking, perhaps there is a problem with the reservations page. Maybe it is too difficult to use, or there is a trust issue, or the user was distracted by a link. If a certain page has a high bounce rate, or exit rate, you should also analyze the content on that page. Ideally you want users to exit only after they have booked or made some other conversion such as providing you with their e-mail or downloading a PDF.

Make sure your booking engines can integrate Google Analytics. Some booking engines have their own tracking system which can help hotels see conversions from PPC ads and other sources. However these systems may not allow you to track what users are doing on your site, or where they are clicking. Therefore you aren’t able to detect potential problems with your website.

On a technical note, you can also see what type of computers and web browsers your visitors are using and test to see if your site functions correctly within those browsers.

• Analytics will show your hotel how people are directed to your website

If you aren’t tracking your internet marketing efforts such as your search engine optimization strategy, PPC campaign, banner ads, e-mail campaigns, or press releases/articles, then you will never know if they were effective. Google Analytics will show you exactly where your traffic came from. You can see the percentage of direct traffic (when the user directly types in your URL), traffic from referring sites (links from articles, social media sites such as Twitter, LinkedIn, etc.) and traffic from the search engines such as Google, Yahoo and Bing.

You can also link Google Analytics to your AdWords account to track your PPC campaigns. Once linked, Analytics will automatically tag your AdWord links for detailed campaign tracking reports. You must manually ‘tag your links’ on all your banner ads, e-mail campaigns, and newsletters so they can be tracked by Analytics. You can learn how to do this on the Google Analytics help page. You do not have to tag links from referral sites because Google Analytics can detect the site automatically.

• Analytics will help your hotel learn about its audience

The visitors reports can show you what countries and cities your users are from, and the languages they speak. This can help you identify where your target audience is, and help you make decisions on your campaigns. Perhaps you have a lot of visitors from local areas, but not enough nationally. Therefore you may decide to do a national campaign. If you see there is a high percentage of Spanish speakers looking at your site, you may want to make want to make your site available in the Spanish language.

• Analytics will tell you which keywords are most effective

The  keywords report will show you overall trends regarding your keywords. You can see which keywords drive the most traffic to your site, and more importantly, which keywords direct users to your site who then make a conversion (take an action you have specified in your goals, such as make a reservation, download information, or submit e-mail). It is important to look at the words that lead to the highest conversion rates as opposed to the ones that drive the most traffic. You should also look at the words that have the highest bounce rate, perhaps users find your site is not relevant to that word.

How do I use Google Analytics?

Google Analytics was designed for specialists and non-specialists to be able to track and analyze the reports. However, as with anything new, it takes a little practice and you need to familiarize yourself with the software. Below we have outlined some steps that will help you get started:

Step One: Set Up a Google Analytics Account for your Hotel

Go to Google.com/analytics and select the blue button on the right that says Access Analytics.

Enter in the URL of your website, account name, country, and time zone. Google will then supply you with a code which is about 4-5 lines of javascript. You need to copy this code and place it in the footer of every page on your website. You may need to ask your web developer to help you with this, or if you want to attempt it yourself you can follow the instructions on the Google Analytics help page, or watch an instructional video on YouTube.

Step Two: Define Goals for Hotel Website

A goal, or conversion, is an action you want the user to take on your website. It can be an e-mail sign-up, an article download, or a reservation. You can also set up an optional sales funnel with up to ten pages. A funnel path is a series of pages which the visitor is expected to pass through before reaching a conversion goal. The funnel could help you see exactly where visitors drop off before making a conversion.

Every set of goals in a Google Analytics profile allows you to create up to 5 goals. You can have four sets, so that’s a total of 20 goals.

Goals & funnels will help you see if your website is performing in line with your business objectives. You will be able to make more informed marketing decisions once you see which campaign or referral brought visitors who made conversions, where the visitors live, and what keywords were most effective in attracting these visitors.

For detailed instructions on how to set up goals and sales funnels see How to Setup Goals in Google Analytics or the Google Analytics help page.

Step Three: Read Analytics Reports

Now that you have taken the time to install Google Analytics and establish goals, you must become familiar with reading and analyzing the reports. Avinash Kaushik, author of the recently published book, ‘Web Analytics 2.0,’ and the best-selling book ‘Web Analytics an Hour A Day,’ came up with a 90 – 10 rule. He says you should spend 90% of your budget on people to analyze data and 10% of your budget on the actual tool you are using.

There are over 80 reports you can customize in Google Analytics, and you can also create your own. You can group all the reports that you like together on one dashboard which you can also e-mail to others. You can also send individual reports and schedule the days and frequency you would like them to be sent out.

Whether you will assign someone at the hotel to produce the reports, or have a third party send them to you, we encourage you to familiarize yourself with the dashboard and the reports available. The best way is just to log into your analytics and see what’s available.

Below we have outlined the basic reports you should view on your dashboard:

Traffic Overview/Site Usage

The Traffic Overview shows you:
• the number of visits to your site
• how many pages were viewed
• the average number of pages viewed during each visit
• the bounce rate (when a user looked at your site but exited without looking at any other pages or clicking on anything)
• the average time visitors spent on your site
• the percentage of new visitors to your site

Visitors Overview

The Visitors Overview is similar to the traffic overview but also allows you to see:
• the number of unique visitors (A unique visitor is one person. A ‘unique visitor’ is different than ‘visits’ because one person could have visited your site 5 times.)
• You can also see the Visitors Segmentation on the right hand side which allows you to see the languages of your visitors, as well as a profile of their browsers and operating systems.

Traffic Sources Overview

The Traffic Overview shows you where your traffic is coming from:
• percentage of direct traffic (users who typed your URL directly into their browsers)
• percentage of referring sites (those who clicked to your site from another site)
• percentage of traffic from search engines results pages (either organic or paid)
• the traffic sources can also show you which keywords drive traffic to your website and which ones are most effective in making conversions. You should also look at the keywords that have a high bounce rate and see if they are relevant to your site.

Content Overview

The content overview will show you how users interact with your site. You can see the following:
• the top content tab will show you which pages are most popular
• top entry pages
• exit pages (where people left your site)
• bounce rate of each page
• average time spent on each page
• on the right hand side you can click on the Navigation Summary to see how people click through your website.
• the site overlay button takes a picture of your page and can show you what people click on.

Step Four: Analyze Analytics Reports

It is one thing to ask what happened, but another thing to ask why it happened. These Analytics reports can show you how many people came to your site, how they found your site, what actions they took on your site, how long they stayed etc., but you are the one who has to interpret this information to find out what is effective and what isn’t.

Once you understand the data, see if your site is living up to the goals you established. Are visitors making the desired conversions? If not, compare your ideal sales funnel to what is actually happening on your site, and see where you may be losing people.

Analyze your traffic sources to see which campaigns are working, and where you need to improve. Perhaps you need to boost your SEO efforts to get more traffic from the search engines, or maybe your banner ad isn’t performing well.

Also remember that the analytics numbers are trends. Expect to see the numbers rise and fall. Gather the information, analyze it, and focus on what you can do to improve your site and internet marketing strategies. As Avinash Kaushik said in a recent post about Analytics, “It’s all about Outcomes baby!” He goes on to say that there are only three types of outcomes any website delivers and they are: increase revenue, reduce cost, and improve customer loyalty/satisfaction. Tracking and analyzing your website and internet marketing efforts with analytics software will help you achieve these outcomes.

Would you like to learn more?

We hope you have found this information useful. As you can see, reading and analyzing Analytics is a very important factor in the success of your hotel website and internet marketing campaign. We have discussed the basics of what analytics is, how to install it, and how to read basic reports, but there are many more features and reports you can explore. If you would like to learn more, we recommend you visit some of these sites:

Google Analytics Education Page

• access a free online course that offers comprehensive training in analytics.

• access Google Analytics videos

Google Analytics Help Center

Google Analytics Blog

Getting Started Guide

Please feel free to contact us at 978-465-5955 or send us an e-mail at info@orourkehospitality if you would like more information about how Google Analytics can help your hotel website

We believe it is time to reinvent the standard hotel website, and we will begin with a quick comparison of a typical hotel website today, and our ideas of how a website should be for 2010.

A Typical Hotel Website Today:

• designed to promote hotel with emphasis on beautiful photos
• difficult to navigate, too many options, user gets lost
• static, no fresh content supplied
• designed from a template
• no links to social media sites such as Twitter or Facebook
• no blog
• no video
• no division between types of travelers (i.e. leisure, business)
• no calls-to-action
• no incentive for user to supply e-mail
• no reason for user to visit your site again
• no personal profiling
• no personal communication with guest
• no reviews
• not optimized for the search engines
• no analytics in place

A Modern Hotel Website for 2010

• designed for the user with emphasis on supplying the information they need
• easy to navigate with no clutter
• dynamic with continually updated content
• created on a content management system that allows hotel to edit content themselves
• links to Twitter and Facebook (or place Twitter stream directly on site)
• a blog to supply useful content to users and help SEO efforts
• videos of hotel and city – videos should be authentic and not glitzy ads
• information should be organized by type of traveler and answer specific questions
• calls-to-action should lead user through the sales funnel
• offer an incentive for users to supply their e-mail (i.e. a downloadable city guide)
• give users a reason to re-visit your site (i.e. ski conditions if your hotel is in the mountains)
• maintain a database of your clients and learn their preferences. This allows for more targeted email campaigns, and a better guest experience at your hotel
• communicate with your guest before, during, and after their stay through email or Twitter
• request reviews from your guests and post them on your website
• make sure your website is optimized for the search engines
• install analytics which will allow you to track user behavior

Your website is at the center of all your internet marketing strategies, and it must be well-designed to provide the guest a positive user experience. If it is ineffective, then all your internet marketing efforts will be in vain. You could be losing guests because of a difficult navigation or reservations page. In today’s market, digital media is growing rapidly and you must grow with it.

We recently attended the Inbound Marketing Summit in Boston created by Chris Brogan, President of New Marketing Labs. Chris is also the co-author of the New York Times Bestseller, ‘Trust Agents,’ with Julien Smith. He is a social media guru and his blog is in the top 10 of the Advertising Age Power150. Chris travels a lot and he sees great opportunities for the hotel industry in social media and online marketing.

Tom O’Rourke founder/CEO of O’Rourke Hospitality Marketing wanted to share Brogan’s insight with the Hospitality Industry in the second part of this video interview. Tom asked Brogan his view on the current hotel website design and navigation structure.

“Don’t make me hate!” was Chris Brogan’s first response to Tom’s question about his view was on the current hotel website design.  He supports our opinion that hotel websites are utterly backwards of what the guests really want. Chris elaborates:

It’s basically these beautiful majestic pictures. No matter how horrible your hotel is, it’s the best possible picture of your venue. It’s great to have pictures, it’s nice to see the layout of the rooms, but take it backwards from the buyer’s experience, because ultimately I’m the buyer.

I have a really strange set of questions when I’m traveling as a dad, or when I’m traveling as a business guy. As a dad I want to know; What’s the biggest room? Can I get a suite? Can I have door-to-door? Basics.

If I’m a business traveler I want to know what the desk is like. What chair do I have? Are there 5 plugs for my stuff? Do you give me free Wi-Fi or should I worry about bringing my card? How late is your business center open?

So what I’m saying when I say all this is that site design now needs to be a bit more dynamic, and it needs to route me through because right now there’s these crazy navigation trees that cascade like rain and have 500 possible ways to go somewhere.

This is not how we buy anything. We don’t buy groceries that way, we don’t buy anything like this – but for some reason hotels think if I offer you 147 things to click on, you might click one.

Tom agrees with Chris that hotel websites should go in a new direction, and he takes it a step further by suggesting that they incorporate social media and interactivity within their website to stay with the guest before, during, and after their stay. Tom believes it would be a different approach for the hotel business, but that it would be giving the guest what the guest really wants.

Chris agrees with Tom and adds some of his ideas:

I concur. Would you like to make seven figures on a business I just don’t have time to start? Here’s my idea, concierge service – it’s not that person at that desk. That’s part of it, but I would like to have someone I could pay an extra $29 dollars a day to keep all of my things in alignment, and tell me the local ‘Staples’ is here, the ‘Target’ is here, do you need me to run out and get you pens and markers? It’s here. I’d pay $29 dollars a day just to know that person was there.

There are so many things we could do. I’m in Manhattan – I’m on 4^th Avenue, I have no idea where I need to eat, and if they ping me right back on Twitter, because I’m a guest, that’s all I have to do, is maintain a little guest registry – they don’t even have to work hard – I can message them, and they can message me back.

There are so many opportunities for hotels to do so much more with these new tools that don’t cost much to launch. They cost time, and they cost a little consideration, and to not do it the way you’ve already been doing it.

So as we approach 2010, it’s time to evaluate your hotel website and internet marketing efforts. Take a look at your current hotel website from a user perspective. Is it easy to navigate or does it confuse the user with too many options? Does it provide the user with the information he or she wants, or does it just show beautiful images? Does it address the needs of individual travelers i.e. business vs. leisure or does it just group all information together? Do you have links to your Twitter and Facebook account on your site?  As Chris says there are so many opportunities for hotels in this space – and we believe 2010 is a great time to start employing these exciting new strategies. Stay tuned to our blog for part II of Innovative Website Ideas for 2010.

You can see the first part of the video interview with Chris Brogan on our blog, Hotels That Listen in Social Media Generate Business.

Below is a list of some of Chris Brogan’s blog posts related to the hotel industry.

Ideas for Hotels and Hospitality

Should Hotels have Social Networks?

Café Shaped Business – The Roger Smith Hotel

Social Media Starter Moves for Tourism

Workflow – Social Media for Marketers

A Hotel Built For Media Makers

We are interested in hearing your thoughts on revolutionizing the standard hotel website. Do you agree with what Tom and Chris suggest? Are you planning to make any changes to your hotel website or internet marketing strategy in 2010? Please comment below.

Sir Martin Sorrell finally appeared at Ad Tech NY this year, after turning down the invitations of the last three years. He opened Ad Tech with his keynote presentation on ‘What’s coming in 2010.’ He focused on New Markets, New Media, and Consumer Insights.

Sir Martin Sorrell is the founder of WPP, one of the world’s leading communications services groups and a member of the FTSE-100, FTSE-Eurotop 300, the MSCI and BusinessWeek’s Global 1000 companies. GroupM, JWT, Ogilvy and Mather, Young & Rubicam and Grey are all part of the WPP Group.

Sir Martin holds an MBA from Harvard University Graduate School of Business Administration and an Honorary Doctorate from London Guildhall University. He is on the Board of Dean’s Advisers of Harvard Business School, and on the Board of the Indian School of Business. He is a governor of London Business School, a member of the advisory board of IESE in Spain, and also on the Dean’s Advisory Council for Boston University School of Management, and Deputy Chairman, London Business School.

Sir Martin was under the impression that he would be speaking to a small intimate group ad Ad Tech but that was not the case as the large room was completely filled. He chose not to have a formal presentation on stage, and instead he walked through the crowd as spoke about the future of advertising in today’s changing landscape and how to work with these changes. We have compiled Sir Martin’s thoughts on the topics below and how they are relevant to your hotel.

Sir Martin’s Forecast

Mobile Phones

Sir Martin began his talk with a theme that was repeated throughout the conference, and that is the mobile phone. Mobile phones play an important role in the world today and this will continue in the future.

He stated that China and India have the largest growth rate in mobile and that the corporation China Mobile rated number 5 in the top most powerful valuable brands in the world.

He said that growth in mobile in the more traditional markets of Western Europe are led by the following five countries; The U.K., France, Germany, Italy and Spain.

As far as WWP is concerned, he stated that mobile advertisements have not been as successful as quickly as they would like to see.

Change from Traditional Agencies

Sir Martin stressed that agencies need to change from their traditional structure and adapt to the global markets and digital media.

“People who run agencies tend to be resistant to change. If you spend 10 to 20 years trying to get to the top, you don’t want to change. You want to spend the last 3 years of your time to go around the world and enjoy yourself with some stability. The last thing you want to do, as I do, is get up and deal with massive change every day,” said Sir Martin.

Recession

Sir Martin wasn’t very encouraging about the recession and stated, “I have worked in Advertising for 33 years and I have never known times more focused on cost than there are now.”

However he encouraged companies to invest in brands in times like these and said they will come out stronger when the recession is over.

He stated that corporations are more open to digital media now because it gives them quantitative opportunities to evaluate spending in ways they never have before.

Growth and L-U-V

One of the main points of Sir Martin’s keynote was how the growth of developing countries and new markets are affecting us, and he stated, “100% of the growth in our 2007 – 2008 came from growth in China and growth in India. In 2009 growth in China has been more than 100%.”

In regards to economic recovery Sir Martin stated that the world is operating at different speeds and he referred to the idea of L-U-V, first coined on a blog entry by Stella Dawson, Treasury correspondent of Reuters. L-U-V is meant to represent economic recovery in the following way:

• The L-shape represents the recovery in Western Europe where there is slow recovery after a long drop.

• The U-shape represents the recovery in the U.S. (he included Spain in this category and then noted they have dropped down), where there a feeble recovery that takes a little longer than a V-shaped one.

• The V-shaped recovery represents the countries of Brazil, Russia, India and China (often referred to as the BRIC countries which was first used by Goldman Sachs) where there is a short recession with a quick rebound again.

New Markets, New Media & Consumer Insights

Sorrell said if he had to sum up WWP strategy in one sentence it would be: New Markets, New Media, and Consumer Insight.

• New Markets

The shift in the market is clear with the focus on the fast-growing developing economies of the BRIC countries (Brazil, Russia, India, and China). There is a large population growth in these countries and an increasing percentage is joining the middle class. South America is also an emerging market.

Sorrell said that every single client they deal with is focusing on those parts of the world for growth. He said that 26% of WPP business was in these countries and he predicts that will increase.

• New Media

Sir Martin states that digital and new media are the strongest forces of growth and the majority of his clients spend 12% to 13% of their world-wide budgets in new media in one shape or form. He believes this will increase significantly over the next five years to 20%.  New media accounts for almost 25% of WPP’s revenue.

• Consumer Insights

Sir Martin stated that a large part of WPP’s business is data information. He said they are the fourth largest information service in the world. “If we were starting from scratch we would have tried to bring these three elements more closely together; media planning and buying, digital piece and the data piece,” said Sorrell.

He referred to a market research project his company will be doing with Google on validating the importance of web-based marketing. Sorrell stated that he believed that Google has become even more important in the last 6 months as they have focused more on core products of Search and Mobile Search.

Sorrell also brought up product overcapacity and stated that most industries, such as the auto industry, is working with an overcapacity of products. He also stated that there is an under capacity of talented workers and he expects that this will worsen as a huge part of the population begins to retire.

Growth in Retail

Growth in retail will become a powerful thing. Some of the most fundamental change is in retail. He stated that Walmart controls 8-10% of the US in retail services and Tesco is the leader in the U.K. Companies that have immense power in the domestic market will have stronger buying power as they move to markets around the world.

Doing Good is Doing Good Business

Sorrell states that corporations will embrace environmental friendly policies and fair business practices. Corporations today are becoming more responsible and are working towards creating products that are more environmentally friendly. Consumers would rather buy from companies who are more environmentally conscious than those who aren’t.

Governments Have Become Major Clients

Governments around the globe are taking initiatives to supply financial stimulus packages to accelerate the growth of the sustainable economy globally.  He stated that the governments are spending trillions of dollars on sustainability related spending.

Branding

There are many new opportunities for brands in this new era. A cultural shift means corporations can change their point of view, or how the consumers perceive them. Sir Martin states, “You can have innovation without branding, but you can’t have branding without innovation.”

Internal Communication & Structural Change

Sir Martin said the biggest problem for a chairman is communicating internally strategic and structural change. New Media has given the CEO opportunities to communicate in a quick flexible way like they never have before and that has implications. He used WWP as an example and said that communicating in a corporation that is multi-branded is very difficult.

He said it was true that companies are becoming more global, it is true that we are seeing consolidations, but as companies become larger and become more complicated, at a country level there is still an intriguing role for country managers. We are not going to go back where we were 10, 15, or 20 years ago, but we are going to see country managers almost as ambassadors, or stronger, dealing with governments, dealing with technological change, dealing with CSR (Corporate Social Responsibility), dealing with education, and dealing with research & development at a company level.

See video at end of this article of Sir Martin Sorrell discussing this topic.

What’s the Role of the Agency in the Changing Landscape?

It’s about strategic thinking. We are embracing technology in a way that traditional media hasn’t done before. Agencies must plan, place, and measure media. It’s about creativity in a much broader sense. He also stressed that the lines between advertising and editorial are becoming more blurred.

What Does This Mean for the Hotel Industry?

Much of what Sir Martin discussed is very relevant to the hotel industry. Although he didn’t discuss specific industries let’s look at what his forecasts for the future can mean to your hotel.

Incorporate Mobile Phones in Your Marketing Budget
Many people are now ‘on the go’ and they use mobile devices such as the iPhone, to search the web, send emails, and use the thousands of apps available. Many markets such as Asia Pacific are worlds ahead of the U.S. in mobile usage, but we will catch up.  Hotels must take this into consideration for the future and integrate mobile websites and mobile marketing into their budgets.

Expand to New Markets and The BRIC Countries

The BRIC Countries (Brazil, Russia, India & China) are projected to dominate the global economy by 2050. You may already have properties in these countries or you may be considering acquiring some.

At the Global Travel & Tourism Summit last May, Luiz Barretto, Brazil’s Minister of Tourism stated the following about the travel industry in Brazil:

The flow of international tourism also rose in 2008.  More than 5 million foreigners visited Brazil last year, leaving here almost US$6 billion, or 16.8% more than in 2007 – an historic record.

In addition to the flow of overseas tourists, it is important to point out that Brazil is like a continent, with a potential internal market of 100,000,000 tourists.  Eighty-five per cent of tourist activity in this country is sustained by Brazilians themselves.  It is this great internal consumer market that explains the good results for Brazilian tourism, even in the face of the adverse international scenario and the economic downturn in the most important tourism source markets.

We have shown a robust performance since the beginning of 2009, when Brazil was at the peak of its summer.  The sector has grown by about 20% in comparison with the same period in 2008.  The increase has occurred in almost all segments of the tourist chain: hotels, airline companies, car rental and among tour operators and travel agencies.

I am certain that these results are a reflection of the combined actions of private companies and the Brazilian Government.  In the past six years, the Ministry of Tourism has invested US$2.5 billion in infrastructure for tourism destinations.  And that number does not include the significant contributions of the Brazilian Government in the context of the great national investment plan for infrastructure that is fully underway.

In the next few years, in addition to the resources that are in the budget of the Ministry, we will have another US$1 billion from the Inter-American Development Bank, to be spent exclusively on tourism infrastructure.

Brazil is also preparing for the 2014 FIFA World Cup and it is estimated that it will bring in 500,000 overseas tourists. Then of course there is the 2016 Summer Olympics. According to CNN the games will be held in four zones with varying socioeconomic characteristics; Barra, Copacabana, Maracana, and Deodoro.

Market Your Hotel With New Media
There is unlimited potential to market in Digital Media in the Hospitality Industry, and hotels need to incorporate this in their marketing strategies. This includes Internet Marketing, Videos, Social Media, Organic Search, Paid Search and Reputation Management, just to name a few.

Consumer Insights
Hotels now have an ability as never before to gain insight about their consumers. There are so many inexpensive and effective ways to do so. Collect your guests’ email addresses and create profiles which you can segment into groups (i.e. type of traveler, age, marital status, and personal preferences). You can manage these profiles in your database and send out very targeted email campaigns to the separate groups.

Interact with your guests in social media sites such as Facebook and Twitter. Read their reviews of your hotel on review sites such as Trip Advisor and respond. Find out who they are, what they like, where they spend their time. When you know who your guests are you can target your message to them in the places where they go, online and offline.

Go Green – Go Global
It is a given that corporations should be practicing policies that are environmentally friendly and culturally aware. Your guests will appreciate this as well.

Branding
In this new era you have new opportunities to brand yourself, whether it be to create a new brand or re-invent and existing one. Be creative and create a niche.

Watch Video

Below is a clip from Ad Tech of Sir Martin Sorrell’s presentation.

If you would like to learn more about Internet Marketing for the Hospitality Industry please call at 978-465-5955 or send an e-mail to info@orourkehospitality.com