Why Your Hotel Needs to Use Google Hotel Ads

When our clients are enquiring about whether or not they should be using Google Hotel ads, one of Google’s latest attempts to further monetise it’s huge search engine, it’s sometimes quite difficult to give concrete reasons why they shouldn’t be listed.

How the Google Hotel Ads work

The way it works is that a user enters Google.com/hotels, or has searched for a hotel, or is on the google maps page where hotels are visible, and enters in their travel dates. Google’s back-end checks the services linked to their Google Hotel Ads program, and performs a variety of complex availability and rate checks. The user is then shown a list of sites where they can click a button to complete the booking, and here is when the fee occurs.

Google Hotel Ads screenshot

Obviously in Google’s eyes they’d love to have every hotel signed up to the program. They earn revenue from the hotels that advertise using it, as for each click onto the hotels website, the hotel is charged a predetermined fee. It works similarly to PPC ads on a CPC basis, however it’s a fair bit more complicated than the standard AdWords PPC search ads. With Google Hotel Finder, several companies can bid on a hotels name, as long as they have the required feed which enables visitors to make a booking at that hotel. So for example the hotel website could have the correct feed (it depends on which booking engine software they are using), but you will also find OTA’s such as Booking.com and TripAdvisor also offering bookings through their own booking engines. So there can be several sources bidding on your hotel name (similar to PPC search ads really) and the top position is based on a variety of factors including availability and average room rate.

One of the nicest features of the platform is that as a hotel you’re only charged when a user clicks on your room-rate after performing their search for a hotel. This means you’ve “won” the initial part of the battle vs the other rivals that were showing rates on your room, and you’ve just bought the interested party onto your booking engine. Here comes the fun part – trying to convert the visitor into a booker. Google will also only show your sponsored ad if your hotel actually has availability for the dates the user has specified, so you know it’s going to be uber-focussed, and should therefore by a highly qualified, and so valuable, lead.

Hotel using Google Hotel Ads

You may not be aware of the fact that even if your hotel hasn’t opted into the Google Hotel Ads program, you can be pretty sure that other OTA’s and availability providers will already be bidding on your hotel name. So that means sites like Booking.com are already “owning” your hotel name in Google hotel ads. This may come as a surprise to you, and probably not a very nice one. OTA’s bid in this way because it gives them a much lower CPA than from other methods, and by entering into Google Hotel Ads your hotel can play some part in fighting for some of its direct business.

Research carried out with Hilton Hotels

Back in March Google published a study carried out with Hilton Hotels based on their use of the Hotel Ads platform. The report showed that their conversion rate had increased by 45 percent whilst their own ROI had grown by 12%, in comparison to traditional PPC ads from the Google Search platform. Ultimately we feel that performance will vary greatly per hotel, and the Hilton Hotel group is quite an extreme example to learn anything from, however as with all marketing initiatives it’s still worth testing.

Conclusion: Are Google Hotel Ads worthy of my investment?

When discussing the program with our clients we normally advise that their hotel should be operating if they are concerned about lost bookings through other channels. There’s no guarantee that you’ll get many bookings from this channel (we’ve had very mixed results and it seems to vary a lot per market) but one thing we do emphasise is that by using Google Hotel Finder you’re enabling your direct business to have a a big part of a 360 degree approach to online bookings. If your hotel is active on PPC, active on social media and SEO, but you’re still losing a lot of business to the OTA’s, then perhaps it’s time that you broadened your reach and started to invest more in MetaSearch, which includes Google’s recent offering. It may not provide as healthy returns as Trivago, or TripAdvisor, but it should be used as part of your overall strategy for protecting your brand online.

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