The billboard effect provides an effective digital approach for hotels to increase their occupancy. It shows that when hotels list or advertise with an online travel agency (OTA), there is a positive impact on direct website bookings and organic online searches. The research is clear and the results are difficult to ignore.
What Is The Billboard Effect?
Travelers are more likely to book their trips directly on a hotel’s website after seeing a listing for the hotel on an online travel agency. This is the billboard effect. With the explosion in choice for travelers, it’s no surprise that they tend to bounce around different websites when doing research. Airline sites, hotel sites, and OTAs are all popular destinations for researching travel plans, but OTAs tend to receive the most engagement. American travelers engage with up to 140 sites in the 45 days before a trip, according to this Expedia research. They also estimate that OTAs make up 30% of all travel site visits. Like it or not, online travel agencies are a crucial factor in the performance of hotels online bookings.
Does The Billboard Effect Work?
The billboard effect phenomenon was first introduced by a professor at Cornell University in 2009. He concluded an increase in bookings through hotel’s official websites after appearing on Expedia.com. To the surprise of some, the same finding was observed in 2011. Chris found that the increase was pretty significant – between a 7.5 and 26 percent increase in total reservation volume after appearing on an online travel agencies listing. This percentage increase does not include the reservations processed through the OTA itself, only direct bookings. Chris hit a statistical jackpot with this finding!
Chris continued his research in 2017 when he published a report titled, The Billboard Effect: Still Alive and Well. I’m sure it can be gleaned from the title what the takeaway was in this set of studies. However, he did note a decrease of about 10% in the influence of the billboard effect when compared to the 2011 study. A couple of additional compelling statistics:
- 39% of direct bookings were made after research was conducted on a hotel’s official website.
- 31% of guests that start searching for accommodations on an official hotel website ended up booking through an online travel agency.
- 75% of travelers who decided to book directly from a hotel’s website had visited an online travel agency beforehand.
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How To Take Advantage of the Billboard Effect
Hotels are in the business of increasing bookings and funneling travelers through complex online ecosystems. The billboard effect is a powerful strategy to increase the organic traffic and direct bookings of hotels around the world. Here’s how to take advantage of this effect:
1. Make Sure You’re Listed On Online Travel Agencies
This has to be step number one! Strive to be listed on as many quality OTAs as possible. Five is a good place to start, and the more the better. Choose the digital travel agencies that advertise listings most closely aligned with your hotel. Check out where your competitors have their listings. This is a good place to start.
2. Keep Travelers Engaged
A high bounce rate is discouraging for any website, especially hotel owners. The goal is for guests to convert their website interaction into a booking.
The way to accomplish this is to keep the website fresh and engaging. Make sure that the design and messaging of a hotel’s website are clear, concise, and relevant. Make it easy for travelers to book rooms, contact the hotel, and find information about current promotions and packages.
Consider adding a blog to your website to help build the brand. Include engaging travel excerpts, relevant news, and tips for your guests. You want prospective customers to build familiarity with your brand, and increased time spent on your website is a great way to do that.
3. Streamline Your Website
Most established online travel agencies have a very polished user interface and experience. They’ve optimized the website to keep the visitors’ experience immersive and painless. When travelers jump over to a hotel’s direct website, they are expecting the same great experience.
Make sure the website aesthetic is appealing and encouraging for customers during their expensive travel decisions. Spend time deciding on catchy images and a nice font. Test its functionality across all devices. Most of all, make the booking process as intuitive as possible.
Travelers aren’t often making booking decisions on their first visit to the website. As we mentioned, American travelers engage with up to 140 sites before a trip. This means they’ll need to easily be able to find their way back to your website. Optimizing your website for improved SEO ranking will allow guests to quickly find your hotel’s website amongst the thousands of search results.
4. Incentivize Direct Bookings
You want travelers booking directly through your website to save on OTA commissions. Offering guests a little extra on a direct booking can help incentivize this. You’ll want rates to be consistent across different websites, but one approach to this is adding on small offerings. This could be complimentary breakfast, free drink vouchers, or flexible check-in and out. We also recommend offering a best rate guarantee on direct bookings. Make sure customers know they’re getting the best deal.
In doing so, you’ll build trust and loyalty amongst customers. Offering tangible benefits for booking direct is an industry secret to repeat customers.
5. Don’t Be A Stranger
Guests want to be remembered. They also want to know they’re receiving a top-of-the-line offer during subsequent visits. Retain contact information and periodically remind them of your special deals. Get to know your travelers so you can best anticipate their expectations and desires.
The billboard effect is alive and well in today’s travel industry. It is a worthwhile approach to advertising your hotel through online travel agencies. The statistics are compelling – implementing these tips will translate to increased direct bookings and organic online searches. The power of the billboard effect!