Market Segmentation
Segments, sources and channels: the mix that sets a hotel’s rate.
Read →Knowledge · Marketing
Search, paid media, the agents, social, reviews and the AI assistants, judged the way an owner should judge them: by what each booking costs and what it leaves.
Eleven lessons
Pay for a booking only when its contribution beats its cost, and only for demand that would not have come anyway. Everything else on this page follows from that sentence.
| Stage | The aim | Where | Measure |
|---|---|---|---|
| Awareness | Be found and remembered | Search, short video, press, AI answers | Reach among the right audience. Searches for the hotel by name |
| Consideration | Be chosen over the alternatives | The website, reviews, metasearch, photographs | Visits to room pages. Review score against competitors |
| Transaction | Take the booking directly | Booking engine, member rate, a benefit only the hotel’s site carries | Conversion rate. Direct share. Cost of acquisition |
| Experience | Deliver the stay and learn the guest | Pre-arrival messages, in-stay offers, Wi-Fi sign-in | Upsell revenue. Guest details captured with consent |
| Advocacy | Turn the guest into the next booking | Review request, email, referral, guests’ own photographs | Reviews gained. Repeat rate |
Give every rupee of spend a stage and a measure before it is spent. A campaign with no stage is noise, and one with no measure cannot be stopped.
Impressions become clicks, clicks become bookings. A hotel’s own site typically converts 1.5 to 2.5 percent of visits.
Return on ad spend is the number agencies report. Turn it upside down to get the cost of acquisition, and set that beside the commission an online travel agent would have charged. Paid search that costs more than the agent has to earn its place another way.
Cost per booking = cost per click ÷ conversion rate. Cost of acquisition = spend ÷ revenue = 1 ÷ ROAS.
A click is worth the contribution of a booking multiplied by the conversion rate. Raise a bid only while the extra clicks cost less than that. Judge the cost of the extra clicks, because the average hides it.
Rank in the auction is the bid multiplied by a quality score. A relevant advertisement and a fast landing page let a hotel outrank an agent who bids more. Fix the page before raising the bid.
Value per click = contribution per booking × conversion rate.
Many guests who click a paid link with the hotel’s name in it would have booked anyway. Pause brand-name advertising in one market for two weeks and count what organic search and direct visits recover.
In one worked example only 35 percent of paid bookings proved to be new, and the true return fell from 2.5 times to under half. Report the return on the increment.
Organic traffic has a price: the clicks you would otherwise buy. Report it in money each month.
Organic traffic value = organic clicks × the cost per click you would otherwise pay.
Assistants answer the question and name a few sources. To be one of them, state the facts plainly and identically everywhere: name, place, what the hotel is, who it is for.
Once a month, put the same five questions a guest would ask to each assistant. Record whether the hotel appears and which source is quoted.
At an equal price the agent often wins, because the guest’s card and loyalty points are already stored there. Keep the public rate in parity and add something only the hotel’s site carries: a benefit, not a lower public price.
Rank channels on net rate, after commission. A listing with an agent does send some guests to the hotel’s own site, but only about 7 percent of shoppers switch. Treat the agent as a paid channel.
Net ADR = ADR × (1 − commission) − fixed cost per booking ÷ length of stay.
Give each platform one job. Short video earns reach for the place and the food. A photograph feed is the portfolio that proves taste. Lead forms sell weddings and meetings. One piece of film cut the same way for every platform does none of these well.
For a restaurant, the map listing, the review sites and the guests already in the hotel matter more than paid social.
A hotel whose review score rose by one point on a five-point scale could raise its price by about 11 percent and hold its occupancy (Anderson). Photographs matter too: doubling the photographs on a listing raised both bookings and rate in one large study.
Fix the product and answer the reviews first. Then raise the rate. Never the other way round.
From impressions to the cost of each booking, set beside what an agent would have charged.
Result · example figures until you change them
What each channel leaves after its cost, and what moving room nights between them is worth.
Result · example figures until you change them
Twenty-five checks in seven tiers, in order of what breaks first. Your ticks stay on this device until you clear them.
Four questions for the owner
Contact
Tell us the hotel, the question and the date by which you need an answer. Accounts are read only under a signed non-disclosure agreement.