Winning Big in a Post-Pandemic Travel Industry by Utilising Machine Learning, Video & Mobile-First Strategies
It’s now more important than ever to ensure you’re strategically positioned to stand out in a crowded market as the travel industry’s recovery continues into the next year and beyond.
Using your digital advertising budget effectively to capture demand is essential, especially as digital advertising spend continues to increase year on year. By not doing so, travel businesses could face an impact on recovery.
The paid media landscape has gone through significant changes over the past 18 months, not least with the pandemic accelerating the shift towards digital alternatives to traditional buying behaviour, resulting in increased competition from advertisers online.
In order to stay ahead of the competition and maximise the potential revenue opportunity in the post-covid travel market, it’s important that you make use of the latest advancements in technology and features available whilst your competition is sleeping.
How to stand out and beat the competition
There are 3 ways of achieving this to beat the competition.
1. Boost results by over 30% by using machine learning to navigate uncertainty and gain a competitive advantage
On average, using machine learning effectively results in a >30% increase in performance vs taking a manual approach to Google Ads. It used to be enough to just focus your advertising spend on a few specific keywords or audiences that you predicted were likely to convert, decide the amount you were willing to pay and the message you wanted to show, and assuming that your customers were all searching the same way and looking for the same thing, this would have led to conversions. You could even retain an element of control over how much you pay per conversion by extrapolating based on conversion rate.
Sounds familiar? It should do, this is how PPC has been since the beginning. However, machine learning has completely changed the game and many advertisers have been slow to adapt.
What is machine learning?
Using big data, machine learning finds patterns in data signals to predict the probability of future outcomes.
Big Data - All the data owned by Google / Facebook etc, including everything you do on any site or app that gives them data, the search engine, social platform etc (this builds up a complex picture of your behaviour online).
Patterns in data signals - Similarity in examples of user behaviour from other users.
Future outcomes - Any action that it’s optimising for (conversions, user experience, relevance etc)
The key to this is the “learning” part, as with more data, better pattern recognition and continuous feedback, comes more accurate predictions.
So what happens when all of a sudden everyone becomes an online consumer overnight and machine learning is supplied with considerably more data, like what we saw due to the pandemic? It accelerates the performance uplift of machine learning and as more advertisers start to shift towards using it, if you’re not doing so, over time results will start to dwindle if they haven’t already, time is running out.
How can you use machine learning to navigate uncertainty and gain a competitive advantage?
As well as driving better results for your business, machine learning allows you to navigate uncertainty by adapting to changing market conditions and maintaining profitability.
With the covid situation constantly changing and restrictions on travel following suit, it’s important to ensure that your paid media strategy is resilient. This is where the real-time and predictive aspect of machine learning is really beneficial.
There are 3 main areas where machine learning should be used to provide this resilience and competitive advantage;
- How much you’re willing to pay.
- Who you target.
- The message you show the user.
Paying the right amount for each user by using Smart Bidding.
How much you bid is one of the determining factors in whether your advertising is cost-effective or not. In the travel industry, being able to spend differently for users that are ready to book vs those that are less likely to book gives you a huge competitive advantage.
The issue with manual bidding is that it doesn’t allow you to adapt to predicted user intent in real-time. However, Smart Bidding does. It determines your bids based on patterns in their behaviour that far exceeds just the keyword that has triggered an ad to show.
Over time, as Smart Bidding learns, you’ll start to opt-out of auctions for lower intent users, meaning that you can funnel your budget into the most valuable users and be more competitive. Here is an example of that in action:
We transitioned a client to smart bidding and saw a 354% increase in revenue.
Targeting the right users with machine learning
Prioritising users that are likely to become your customers allows you to spend more effectively on advertising. Targeting and bidding go hand in hand when machine learning is used effectively. The user's journey is becoming increasingly complex and understanding this manually becomes a challenge.
As well as this, In February 2021 Google’s keyword match types changed. Advertisers not using Smart Bidding naturally resisted this change because it would mean paying the same amount for each user that broad keywords show for regardless of intent. If you are using Smart Bidding, you are able to broaden your targeting, show for users that are not necessarily searching exactly how you think and bid the required amount for each.
Tailoring your message to the individual
Another excellent opportunity to get ahead of your competition is to use machine learning to tailor your messaging to each individual customer. As well as not all having the same intent to book holidays, not all users resonate with the same message. In fact, their needs can often change periodically as we saw over the course of last year as a result of the pandemic.
Using machine learning, you’re able to predict what message is likely to resonate with the user regardless of what they have searched. Here’s an example:
As the travel industry has potential for making the most out of creative assets, with often inspiring and visually engaging imagery. It’s even more important to use machine learning to ensure that you’re capitalising on this potential.
Facebook and Instagram give you the option to select “Dynamic Creative” which allows you to select multiple images and videos as well as different ad copy to show the most compelling combination to the individual user.
This is not just based on what is proven to perform amongst a similar demographic, but what they are likely to resonate with based on their behaviour on your site and similar sites across the web.
2. Adapting to changing consumer behaviour with video & mobile-first strategies
The key to success in marketing is to start with the customer. Understanding how the pandemic has changed their online behaviour when booking holidays and capitalising on the new opportunities that present is paramount.
Despite travel being very limited throughout 2020 & 2021, with restrictions still in place for the foreseeable future, YouTube watch time for travel content has increased by 15% YoY showing the appetite has only increased.
Industry commentators have noted that as the travel industry has started to return to some kind of normal, younger generations have been the early adopters and, on the whole, older generations want more reassurance before travelling with new restrictions in place.
Travel brands should use video campaigns to inspire the younger generation and reassure the older generation. By placing ads at earlier touchpoints in their decision-making journey, you will maximise exposure to your business.
When it comes to the younger generation, their decisions are largely influenced by how “authentic/real” the travel videos are. This represents an opportunity to use influencers in your video campaigns by partnering with travel vloggers. Using influencers to inform the user whilst showing the “authenticity” of the video shows credibility and builds trust for your business.
As well as this, 24% of consumers now spend more time researching their trip before making a booking with 80% of consumers saying that they typically switch between online search and video when researching things to buy.
Users are constantly on the go and the one thing that is always in their hands is their phones. In fact, 70% of Hotel Ads searches are on mobile. With the high percentage of mobile searches, all of your ads should be optimised for mobile use. Making sure that your ads are visually appealing on a smaller screen by creating fast-paced cuts, using brighter video content and having larger on-screen text will help you to stand out and stop their scroll.
The key here is to engage them with a compelling narrative, but when it comes to ads, this differs from traditional storytelling. Traditionally when telling a story, you would build suspense leading up to a climax and then go on to talk about your offer and brand. With a video ad, it needs to be as interesting and eye-capturing as quickly as possible.
Start high to grab their attention, before subtly presenting your brand to build affinity. After this, differentiate your value proposition with unique selling points before ending with a CTA. This should be 15 to 30 seconds.
Another way that user behaviour has changed is that since the start of the pandemic, working remotely has been the norm for most people and this is looking like a trend to stay. As a result, business travel has been down -80% with ‘workcation’ queries up +220%.
With more people having video conferences instead of meeting face to face, people are finding ways to turn working remotely into a luxury. Business travellers are now looking for more leisure type experiences instead of travelling for meetings so as well as taking advantage of machine learning, video ads are a great opportunity to highlight these features to an in-market user.
3. Capitalising on the latest travel features from Google & Facebook
Connect with users and increase room occupancy by setting up Hotel Ads. When it comes to a user choosing accommodation, researching online plays a key role. Google Hotel Ads provide a great way to become visible on the Google search results page. With this feature, you can provide information and live updates of available rooms on the dates the user is actively searching for. If there is no availability, the hotel ad will not be shown.
80% of leisure travellers believe it is important to have as easy and convenient a booking journey as possible. Those who are ready to book can use the booking feature on the ad or click through to your website to complete the booking. Hotel ads are also very cost-efficient as you only pay for the ad when a user has booked.
Additionally, 70% of travellers search for accommodation on their smartphone or tablet which is why Google optimises Hotel ads for the mobile experience. This gives you the ability to reach new as well as returning customers whilst they are on the go.
Similarly, Facebook and Instagram offer similar capabilities to reach users in highly effective ways. With their travel ads features, you can use machine learning to reach users at different stages of their trip planning journey with options that are the most relevant to them, whilst showcasing visually engaging creatives. Not all travellers are the same so it’s important to use this to your advantage by targeting those who are dreaming of travel but haven't set a destination yet differently from those who have demonstrated interest in certain places and types of trips already.
If you’re not using these features then you are missing out on a lot of opportunities to maximise your marketing strategy. If you would like more information on setting up Google’s and Facebook’s travel ads then download our free cheat sheets below:
What about the organic search landscape?
SEO in the travel sector has been getting harder and harder for many years now. Unlike many sectors though, the biggest threat is actually coming from Google who clearly has its eyes fixed on this huge and lucrative area. Analysts have acknowledged that Google is a direct competitor to companies in the travel sector and have adjusted their confidence levels for stock performance as a result:
“In our view, the most concerning trend is the reduced efficiency of SEO (search engine optimization) marketing as Google pushes ‘free’ links further down the page,” he wrote. “In particular, Google is favoring its own ‘Hotel Finder’ platform, along with other paid links, all of which are capturing more real estate on page one of the search results. Expedia is, therefore, having to resort to the use of higher-cost marketing channels, which is negatively impacting marketing ROI and Ebitda.”
Expedia themselves admitted in 2019 that they were having to shift marketing spend to higher cost channels by saying that they were dealing with “incremental weakness in SEO volumes and a related shift to high-cost marketing channels.”
The sentiment was shared by TripAdvisor, who also pointed to “some incremental SEO headwinds” in the latest quarter, with its chief executive remarking that “it’s always hard to know exactly what Google is doing.”
This has only gotten worse in the last couple of years with further developments in the Google travel search ecosystem. Originally launched in 2019, Explore has now become Travel and once you’re inside this experience, it’s (un)surprisingly hard to leave it:
The problem isn’t so much the experience itself though. It’s the well-documented issues around Google appearing to use its dominant position to funnel people into the experience ahead of other travel websites.
Over the years, we’ve seen them step into flights, hotels, rentals and more recently, attractions. Each time, they’ve been able to place results prominently in search results, leading to them being able to funnel people into their own experience. Granted, they’ve sometimes then made changes to the products to stop taking fees and therefore, not labelling them as Ads or Sponsored:
The thing is, can we trust that this will always be the case? Aside from possible legislative action, Google can do what they want here.
If travel websites become reliant upon the revenue that these kinds of features drive, then it becomes a pay to play traffic source, will they turn it off?
What this means for online travel brands
SEO is, and will always be, a vital part of digital strategy for any travel brand. Personally, despite the trends that we’ve touched on above, I think that SEO will always drive a significant enough portion of traffic to make it a worthwhile investment.
With that said, we can’t ignore these trends and need to adapt our strategy accordingly. At Aira, we’re advising a number of things:
Obsess over business outcomes
Working in SEO, it can be easy to get caught up in lots and lots of objectives and KPIs such as traffic, rankings and visibility. Of course, these are important but at Aira, we focus on optimising for business outcomes - sales and revenue.
In the travel sector, ROI and EBITDA is going to get squeezed more and more in the coming years, meaning that your paid media spend needs to perform for you. It’s not something that you can let slip and not keep an eye on.
In summary, SEO is (and always will be) important to online travel brands. But don’t bury your head in the sand in regard to the growing impact that Google and wider competitors could have on your bottom line. Don’t build a brand that relies upon organic search traffic alone, diversify and invest in a range of channels whilst ensuring that paid media delivers ROI and revenue.
Don’t rely on one channel or source of traffic
It’s never a good idea to be overly reliant on one channel at the best of times, let alone one such as organic search in the travel space which is clearly of high interest to Google. Even putting that to one side, you should be aiming to drive growth everywhere.
Build your own database of customers
Related to this, all channels need to drive customers (and potential customers) into your own ecosystem so that you can reach them directly. Email marketing is one of the oldest forms of digital marketing, yet one of the most underutilized. If you can get it right, it can be a great source of revenue and engaged traffic that will grow in value over time. Expedia has openly said that their future is about driving direct relationships with customers, saying “We will drive more downloads, and we will do everything we can to diversify traffic to more direct arenas.”
Invest in your brand
Google is very, very good at recognising and rewarding brands. Why? Because generally, customers trust brands and expect to see them in search results. If you do a search for “apartments in central London”, there are a handful of brands who you would expect to see on the first page, right? You need to be focusing on brand and loyalty to it.