Social media is no longer just a hub of sharing activity between people, it has now become a platform for businesses to promote and sell their products. From facebook, TripAdvisor, Twitter over to the “oldie” eBay these channels demand a new way of interacting with guests while also securing additional revenue and bookings.

Published: 23 Jun 2011

Social media is no longer just a hub of sharing activity between people, it has now become a platform for businesses to promote and sell their products. From facebook, TripAdvisor, Twitter over to the “oldie” eBay these channels demand a new way of interacting with guests while also securing additional revenue and bookings.

By Sascha Hausmann, CEO, RateTiger

The social media revolution has provided new ways of consumer communication, sharing information and being close to a community. While the industry still thought consumer reviews exploded quickly, the likes of Facebook, twitter and Groupon have taught us what pace customers can take when adopting new phenomena once provided with the right toolset.

Despite the burden being forced upon the travel industry, it has also delivered new opportunities for businesses to get involved in such interaction and yet again provide targeted audiences with adequate product.

Facebook (over 500 million active users), MySpace (44 million active US users) and Twitter (21 million active users) have significantly influenced the way people interact, what they trust, how they share their experiences and the advice they offer/receive to/from their ‘friends’. These consumer portals are now becoming powerful marketing and business tools that the hospitality industry needs to address in the upcoming years to avoid losing out on potential revenue avenues or aggressive branding opportunities. Although the latter only has an indirect impact on revenue, it can help to direct more traffic to the hotels own websites that in return provides for more profitable income.

TripAdvisor (34 million monthly visitors) originally caught hoteliers by surprise. It felt that almost within weeks hotels had to deal with negative “press” although the actual movement has been going on for years and was nothing new. In the meantime online guest review websites have taken off with nearly every OTA incorporating some form of guest feedback that’s visible to new customers. Today hoteliers have no choice – either interact positively with guest reviews or see the business suffer. Hotels that effectively manage their guest reviews, both good and bad, encourage more reviews, which as a result sees the rating of their properties rise. As more guest review websites incorporate booking options the impact that your position can have on your revenue is immense.

Social media is no different. Hoteliers that dedicate time to managing social media can see positive results in their revenue; “Online social media reviews have become an incredibly influential channel for revenue generation. We have put greater importance on managing guest feedback and become very successful at doing so. The higher our ranking, the greater the revenue and bookings therefore it is essential we continue to manage opinion wisely,” said Ranya Kalus de Bragança, Deputy Director, Hotel OTTO.

Facebook applications are starting to turn this space into an ecommerce platform with huge revenue opportunities. The first hotels are already selling rooms through Facebook; followers can interact, share their experience and book a room right where the information is placed. Booking engines specifically designed for Facebook (like the one provided by Open Hospitality) turn fan pages into a complete distribution platform.

Websites that were no more than a second-hand buying platform have today turned into intelligent marketplaces. eBay for example, with over 233 million users worldwide, earns 14% of the global e-commerce market. Hotel brand have started to take advantage of the booking opportunities provided but are nowhere near maximizing it.

The dithering about whether Social Media has an impact on travel has no place in a world where it is being used day-in day-out. Consumers desire for information and interaction 24/7 should be taken ever more seriously by the hotelier. Social media is all about developing that personal relationship with your audience that goes beyond the pre-sales and their stay, reaching far into post-sales where it completes the cycle. Nowadays we are not monitoring only one customer cycle from shopping over booking to post sales but have to be aware of many customer cycles being in progress at any given point.

Revenue management, reputation management and marketing management need to work together to build or keep a strong online brand and reach the right audiences. Intelligent booking data and careful monitoring of guest feedback will help establish more innovative and relevant marketing that will ensure maximizing sales potential and subsequent revenue.

Therefore, it is essential that hoteliers provide a clear proposition and product, web presence, OTA sales, monitor guest review websites and begin interacting with Facebook and Twitter. This will strengthen your brand, bring you closer to your guests and help you earn additional revenue. But it also means that the already complicated job of being a hotelier does yet become again more complicated.