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Hotels
ExcErpT from the 2013 Digital IQ Index®: Hotels To access the full report, contact [email protected]
January 31, 2013
ScOTT GALLOWAYNYU Stern
In partnership with:
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• Sixty-six percent of travellers indicate they will spend more
time online researching travel purchases in 20122 (up from
59 percent in 2011). In an industry flooded with choice, deft
search engine marketing, loyalty initiatives, and site content
investments are the sharpest tools to cut through the clutter.
• Direct bookings via brand websites are three to five times
more profitable than bookings secured through OTAs and/
or travel agents.3 Rooms booked through a hotel brand site
also register a higher average price.
• Sixty-three percent of travelers consult online reviews before
booking, including 73 percent of consumers between the
ages of 18 and 34.4 Transactional data from Travelocity
indicates a one point bump in review scores (on a five point
scale) which translates to an 11.2 percent price premium.5
• Fifty-seven percent of business travelers access travel
information from a mobile device, up from 25 percent in
2009.6 A third of mobile searchers reserve within 24 hours,
resulting in high margin bookings.7
UpgradeEleven brands in the Index launched sites in the past year
including icons Hilton, Mandarin Oriental, and Sofitel.
Eighty-one percent of hotel brands now boast a mobile-
optimized site, up from 66 percent in 2012. Eighty-one
percent feature at least one iOS application, many of which
are designed to enhance the guest experience during their
stay. All but two brands are present on Pinterest and 82
percent are present on Instagram—social media’s latest
objects of affection. Content destinations, ranging from the
Four Seasons’ Weddings and Taste features to Fairmont’s
“Everyone’s an Original,” transform sites from booking
engines to travel portals.
VacancyThere is considerable untapped opportunity. Despite the
importance of online reviews, just 28 percent of brands in
the Index include user reviews or link to third-party review
sites such as TripAdvisor, which is now worth ($6.7 billion)
more than the majority of firms in the Index. Tablet searches
for hotel brands are up 180 percent in the past 12
months, but no brand in the Index hosts a fully optimized
touch commerce and browsing experience. And, while 74
percent of affluent travelers suggest that they are more likely
to book after watching video,8 just 25 percent of the brands
feature video on their property pages.
Digital IQ = Shareholder ValueBrands that have embraced digital innovation—and their
shareholders—are reaping rewards. Our data reveals a
positive relationship between year-over-year growth in Digital
IQ (across multi-brand companies) and change in stock
price, supporting our thesis that digital competence is linked
to shareholder value in the hotel sector.
Our third annual study quantifies the digital competence
of 57 global hotel brands. Our aim is to provide a tool for
identifying areas of strength and weakness, helping brands
achieve greater return on digital investments. Like the
medium we are assessing, our approach is dynamic. Please
reach out with comments to improve our methodology and
findings. You can reach me at [email protected].
Scott GallowayProfessor of Marketing, NYU SternFounder, L2
20 & 92Nearly 20 years since the advent of the Netscape browser, 92 percent of U.S. travelers book hotel reservations online.1 Several factors have converged to make digital key to a brand’s success or failure:
1. Travel Booking—U.S., Mintel, December 2012.2. The Traveler’s Road to Decision, Google and Ipsos MediaCT. July 2012.3. Distribution Channel Analysis: a Guide for Hotels,” Green, Cindy Estis & Lomanno, Mark, 2012.4. Travel Booking U.S., Mintel, December 2012.
5. Cornell Hospitality Report, November 2012.6. The Traveler’s Road to Decision, Google and Ipsos MediaCT. July 2012.7. Tnooz.8. The Traveler’s Road to Decision, Google and Ipsos MediaCT. July 2012.
Year-Over-Year Growth in Digital IQ and 52-Week percent change in Stock price
Hotel companies with published Data, n=10
r=0.447
-40%
60%
-10%
0%
10%
20%
30%
40%
50%
-30% 20% 10% 0% 10% 20% 30% 40%
Growth in Digital IQ percent rank
52 W
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30% Digital MarketingSearch, Display, and Email Marketing Efforts Search: Traffic, SEM, SEO, Web Authority
Advertising and Innovation: Display, Retargeting, Cross-Platform Initiatives
Blog & Other User-Generated content: Mentions, Sentiment
Email: Frequency, Content, Innovation, Segmentation and Trigger Emails
Digital IQ classesGenius 140+Digital competence is a point of competitive differentiation for these brands. Creatively engineered messaging reaches travelers on a variety of devices and in many online environments.
ABOUT THE rANKING
Gifted 110–139Brands are experimenting and innovating across site, mobile, and social platforms. Digital presence is consistent with brand image and larger marketing efforts.
Average 90–109Digital presence is functional yet predictable. Efforts are often siloed across platforms.
Challenged 70–89Limited or inconsistent adoption of mobile and social media platforms. Sites lack inspiration and utility.
Feeble <70Investment does not match opportunity.
The Methodology
40% Site
20% Mobile
10% Social Media
Effectiveness of Brand Site 75% Site Technology and Tablet Experience Site Search and Navigation Reservations Property Pages and Destination Guides Customer Service Account Functionality and Loyalty Programs
Brand Translation 25% Aesthetics Messaging and Visuals (Provided by SapientNitro)
compatibility, Optimization, and Marketing on Smartphones, and Tablets Mobile Site: Compatibility, Functionality, Transaction Capability
iOS Applications (both iphone & ipad): Availability, Popularity, Functionality
Android: Availability, Popularity, Functionality
Innovation: Geolocal, Recent Brand Initiatives
Brand presence, community Size, content, and Engagement Facebook: Likes, Growth, Tabs & Applications, Responsiveness, Interaction Rate
Twitter: Followers, Growth, Frequency, Online Voice
YouTube: Search Visibility, Views, Number of Uploads, Subscriber Growth, Viral Videos
TripAdvisor: Site and Social Media Integration, Brand Responsiveness, Number of Reviews
Emerging Social Media: Instagram, Google+, Pinterest, Tumblr
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GENIUSW Hotels
GIFTEDInterContinental
WestinFour Seasons
The Luxury CollectionSheratonSt. Regis
HiltonFairmont
The Ritz-CarltonMandarin Oriental
SofitelWaldorf-Astoria
Hotel IndigoMarriott
Renaissance MGM Resorts
SwissôtelLe Méridien
OmniHyatt
Shangri-La
AVERAGEConrad
JW MarriottLoews
RadissonOrient-Express
Radisson Blu Small Luxury Hotels
of the WorldWyndham
Kimpton Park HyattJumeirah
Dream
CHALLENGEDMorgans Hotel Group
Viceroy Joie de Vivre
The Peninsula Kempinski
The Leading Hotels of the World
Pullman Taj
Millennium Preferred
Tryp by WyndhamOne&Only
The Langham Rosewood
Dorchester CollectionMGallery
Warwick International HotelsPan Pacific
Concorde Relais & Châteaux
Oberoi
FEEBLERaffles
Banyan Tree
1
RANK BRAND DIGITAL IQ
142
DIGITAL IQ rANKING
Starwood Hotels & Resorts Worldwide
RANK BRAND DIGITAL IQ
2 136
2 136
4 134
4 134
6 133
7 130
8 127
Four Seasons Hotels
Starwood Hotels & Resorts Worldwide
Starwood Hotels & Resorts Worldwide
InterContinental Hotels Group
Starwood Hotels & Resorts Worldwide
Starwood Hotels & Resorts Worldwide
Hilton Worldwide
Gifted
RANK BRAND DIGITAL IQ
9 122
10 118
11 117
11 117
13 115
14 114
14 114
Fairmont Raffles Hotels International
Mandarin Oriental Hotel Group
InterContinental Hotels Group
Marriott International
Hilton Worldwide
Accor
Marriott International
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GENIUSW Hotels
GIFTEDInterContinental
WestinFour Seasons
The Luxury CollectionSheratonSt. Regis
HiltonFairmont
The Ritz-CarltonMandarin Oriental
SofitelWaldorf-Astoria
Hotel IndigoMarriott
Renaissance MGM Resorts
SwissôtelLe Méridien
OmniHyatt
Shangri-La
AVERAGEConrad
JW MarriottLoews
RadissonOrient-Express
Radisson Blu Small Luxury Hotels
of the WorldWyndham
Kimpton Park HyattJumeirah
Dream
CHALLENGEDMorgans Hotel Group
Viceroy Joie de Vivre
The Peninsula Kempinski
The Leading Hotels of the World
Pullman Taj
Millennium Preferred
Tryp by WyndhamOne&Only
The Langham Rosewood
Dorchester CollectionMGallery
Warwick International HotelsPan Pacific
Concorde Relais & Châteaux
Oberoi
FEEBLERaffles
Banyan Tree
RANK BRAND DIGITAL IQ
14 114
17 112
17 112
19 111
19 111
21 110
21 110
Fairmont Raffles Hotels International
Hyatt Corporation
MGM Resorts International
Marriott International
Omni Hotels & Resorts
Starwood Hotels & Resorts Worldwide
Shangri-La International Hotel Management
RANK BRAND DIGITAL IQ
23 109
24 105
24 105
26 104
27 101
28 100
29 99
Marriott International
Orient-Express Hotels
Hilton Worldwide
Carlson Rezidor Hotel Group
Loews Hotels
Carlson Rezidor Hotel Group
Small Luxury Hotels of the World
Average
RANK BRAND DIGITAL IQ
30 98
31 96
31 96
33 95
34 92
35 88
35 88
Hyatt Corporation
Morgans Hotel Group
Kimpton Hotel & Restaurant Group
Wyndham Hotel Group
Wyndham Hotel Group
Jumeirah International
Viceroy Hotel Group
challenged
DIGITAL IQ rANKING
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GENIUSW Hotels
GIFTEDInterContinental
WestinFour Seasons
The Luxury CollectionSheratonSt. Regis
HiltonFairmont
The Ritz-CarltonMandarin Oriental
SofitelWaldorf-Astoria
Hotel IndigoMarriott
Renaissance MGM Resorts
SwissôtelLe Méridien
OmniHyatt
Shangri-La AVERAGE
Conrad JW Marriott
Loews Radisson
Orient-ExpressRadisson Blu
Small Luxury Hotels of the World
Wyndham Kimpton
Park HyattJumeirah
Dream
CHALLENGEDMorgans Hotel Group
Viceroy Joie de Vivre
The Peninsula Kempinski
The Leading Hotels of the World
Pullman Taj
Millennium Preferred
Tryp by WyndhamOne&Only
The Langham Rosewood
Dorchester CollectionMGallery
Warwick International HotelsPan Pacific
Concorde Relais & Châteaux
Oberoi
FEEBLERaffles
Banyan Tree
DIGITAL IQ rANKING
RANK BRAND DIGITAL IQ
37 87
37 87
39 85
39 85
41 84
41 84
43 82
Joie de Vivre Hospitality
Kempinski
The Indian Hotels Company
The Hongkong and Shanghai Hotels
Accor
The Leading Hotels of the World
Millennium & Copthorne Hotels
RANK BRAND DIGITAL IQ
43 82
43 82
46 80
46 80
48 79
49 77
49 77
Kerzner International Resorts
Dorchester Collection
Wyndham Hotel Group
Preferred Hotel Group
Rosewood Hotels and Resorts
Langham Hotels International
Accor
RANK BRAND DIGITAL IQ
51 76
52 75
53 74
53 74
55 71
56 69
57 65
Warwick International Hotels and Resorts
Concorde Hotels & Resorts
The Oberoi Group
Pan Pacific Hotels Group
Relais & Châteaux
Fairmont Raffles Hotels International
Banyan Tree Holdings
Feeble
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regional LeadersPhoCusWright and PricewaterhouseCoopers reported
that in 2010 59 percent of U.S. travel revenues originated
online, versus 43 percent in Europe and 21 percent in
the Asia-Pacific.9 Hotel brands headquartered in North
America boast significantly higher digital IQ’s than global
counterparts.
Regardless of HQ locale, the lion’s share of growth will
come from emerging economies. Brands are beginning to
customize site experiences, regardless of where properties
are located. Two thirds of brands offer a Chinese version
of the site and more than half offer German, French and
Spanish versions.
9. “Web Is Bright Spot in Europe Travel Market,” Karin von Abrams, eMarketer, January 14, 2010.
percentage of Brands with a Site Available in the Following Languages
January 2013
Average Digital IQBy region (HQ)
January 2013
علا رَ بَ يِ � ة ُ ع/ َ ر
ب ع/يِ رَ بَ ىِрусский
язык한국어Italianoportuguês
日本語françaisespañol
Deutsch64%Chinese
55%German
53%Spanish
53%French
48%Japanese
29%Portugese
28%Italian
16%Korean
14%Russian
9%Arabic
Source: Euromonitor
Travel Accomodation Market Size by regionMarket Size (2011, USD billion) Growth (2011-2016 CAGR)
North America
Middle East & AfricaAsia Pacific
Western Europe
153.7
25.4
180.6
212.41.0%
3.8%
5.1%
4.9%
106 94
88 86
North America
n=35
Europen=12
Middle East & Africa
n=2
Asia Pacific
n=8
KEY FINDINGS
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KEY FINDINGS
The Booking EngineNearly two-thirds of travelers are booking hotels online, with
43 percent of business travelers and 39 percent of leisure
travelers booking directly from a lodging website.10 While 88
percent of travelers comparison shop and 63 percent consult
travel reviews before booking, more sophisticated site features
such as 360 degree tours, product-page video, and hotel staff
tips are just starting to emerge. Use of on-site user ratings and
reviews is 28 percent versus 17 percent in 2012.
Fewer than one in four brands provide live chat functionality.
When Omni Hotels implemented live chat features in 2010, it
registered a dramatic lift in conversion rates (from 3 percent for
site visitors who did not use the feature to 18 percent for those
that did), and an 8 percent increase in AOV.11 On average,
visitors spend 27 percent more time and register 39 percent
more page views on hotel sites with live chat.
Forty-two percent of leisure travelers indicate that virtual tours
or pictures are important features when selecting a hotel,12
however just 28 percent of hoteliers offer detailed photographs
of their accommodations, and only 28 percent offer virtual
tours or 360 degree views.
10. “The Hotel Traveler’s Road to Decision,” Google Ipsos OTX MediaCT, July 2012.11. http://www.liveperson.com/sites/default/files/pdfs/Omni_CaseStudy.pdf12. “The Hotel Traveler’s Road to Decision,” Google Ipsos OTX MediaCT, July 2012.
customer Service percent of Brand Sites with the Following Features
December 2012
property Functionality percent of Brand property pages with the Following Features
December 2012
Ratings and Reviews Live Chat Callback Contact Concierge28% 23% 19% 16%
Restaurant Reservations 360 Degree RoomView or Virtual Tour
Videos Book Hotel Amenities(Spa, Golf, etc.)
39% 28%Detailed Room View28% 25% 21%
“Curated, personalized content is resonating more with luxury hotel guests. Videos, local tips provided by experts, exclusive amenities, booking
rewards—all play an important role in providing a unique guest experience.”
BILL KANArIcK worldwide cMo, SapientNitro
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KEY FINDINGS
Search continuedSeventy-four percent of brands purchase against their
own brand keywords. The competition for paid real estate
between brands and OTAs is fierce. Brands command 49
percent of real estate for brand terms, OTAs are not far
behind garnering a third of the search results.
Organic Search real EstateAverage percent of Brand-Owned
real Estate by Industry
Hotels Specialty Retail
Sportswear FashionBeauty Spirits Watches & Jewelry
46% 38% 36% 30% 27% 25% 25%
percent paid real Estate of First page Brand Search results
December 2012
Brand
TripAdvisor
Competitor
Other
OTA
4%
7%
8%
32%
49%
percent Organic real Estate of First page Brand Search results
December 2012
Brand
Competitors
OTA
TripAdvisor
Other
3%
8%
15%
29%
46%
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KEY FINDINGS
MobileEighty-one percent of the brands in this year’s Index offer
a mobile site experience, a year-over-year increase of 15
percent. Across the app ecosystem, increases in mobile
platform adoption are substantial, with each operating system
seeing double-digit growth. Both Android and BlackBerry—
with a waning, but travel-savvy user base—saw increases of
above 18 percent in app adoption. Eight of 10 smartphone
users and nine of 10 tablet users who have booked travel on
their devices reported they would do so again.13
Hotel brands’ mobile sites and apps typically have different,
complementary foci. Brand sites focus on the m-commerce
(bookings) experience, while many apps provide functionality
to enhance the in-stay experience. Forty percent of iOS apps
feature city guides, 18 percent provide concierge services,
and 15 percent allow users to order room service directly
from the app.
Hotel brands are investing heavily in mobile search,
with the average brand owning 57 percent of its organic
results for brand search. Starwood saw its monthly mobile
bookings increase 20 percent after running click-to-call
ads for its brands.14
13. “The Rise of Mobile Adoption, Sentiment and Opportunity,” comScore, November 2012.14. “Advertising Relearned for Mobile,” Claire Cain Miller, New York Times, October 28, 2012.
“Once again, accessible mobile platforms are the dominating factor in reaching consumers. Connecting your consumer to your hotel needs to be immediate, constant,
and compatible across media channels.”
BILL KANArIcK worldwide cMo, SapientNitro
Mobile Adoptionpercent of Brands on the Following Mobile platforms
2011 vs. 2012 vs. 2013
20122011 2013
iOS Mobile App Functionalitypercent of Apps
December 2012
43%40%
33%
26%
20%18%
15% 14%12% 12%
10%
Reservations
City Guides
Rich Media Content
Property Directory
Email Sign Up
Concierge
Room Service
Language Selection
Housekeeping
Guest Reviews
Check in/Out
Mobile Website Android App
iPad App Blackberry App
iPhone App
54%
68%
81%
12%
44%
60%
20%
22%
40%
63%
66%
81%
10%
46%
65%
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Click to Jump To:
4 Methodology
5 Digital IQ Rankings5 Genius
6 Gifted
7 Average
8 Challenged
9 Feeble
10 Key Findings10 Digital IQ Distribution
11 Enterprise Effect
13 Regional Leaders
14 Biggest Winners & Losers
15 The Booking Engine
16 Loyalty
17 Touch
19 Search
21 Email: Baby Steps
22 The World’s #1 Travel Destination
23 Social Media Penetration
25 Global Management
26 F-Booking?
27 Size vs. Engagement
29 Instagram > 1k Words
30 The New Kid
31 YouTube
33 Mobile
34 Property All Stars
35 Flash of Genius35 Shangri-La, W Hotels, and Four Seasons: UGC Contests
36 Fairmont, One & Only Resorts: Digital “I Do”
37 Hilton Hotels & Resorts: Vacation Rx
38 Hotel Indigo, Relais & Chateau: Destination Guides
39 Conrad: Swipe for Service
40 Renaissance: Digital Rebirth
41 Sofitel: Pick a Pastry
42 Lowes, Millennium, Only&Only, SLH: Crucial Communication
43 Shangri-La: Incentivizing App Adoption
44 Four Seasons: The Many Faces of Luxury
45 L2 Team
46 About L2
Watch the Hotels Video Click to Play
TABLE OF cONTENTS
12
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