Hotel Online  Special Report

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Key Issues Facing Online Marketers in Europe
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IMHI Hotel Internet Marketing Strategy Conference Wrapup

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July 6, 2004 - The first European Hotel Internet Marketing Strategy Conference took place in the Thistle Tower Hotel, London on Friday, 28 May 2004 as an add-on event to the HEDNA (Hotel Electronic Distribution Network Association) conference earlier in the week. Sponsored by Institute de Management Hotelier International (IMHI) in conjunction with the HSMAI Hotel Internet Marketing Committee, Americas Board, the one day session attracted over sixty delegates representing the major European hotel chains and distribution service providers. 

The first speaker, Andrew Lothian (CEO of Demys Limited) addressed the issue of domain name protection on the Internet.   He made the comparison between domain names and doorways – saying that both have similar objectives in the online and offline world respectively – to get people into your business.  However online doorways have their unique problems – specifically that if they are not properly managed, they can (relatively easily) disappear, be stolen or hijacked, and subsequently lead your customers to inappropriate content, protest sites or even worse, to your competition!  During his presentation, Andrew stressed the need to take a proactive approach to managing domain names, insuring that each one is registered to the company itself rather than to individual employees.  He also stressed that companies should not suffer from dot-com blindness, focusing solely on their brand(s).com sites to the detriment of country domains that can be just as powerful at guiding customers to the website.

The second speaker, Kristofer Peterson, a senior consultant at Cogent IPC, took up this theme of active management of the internet resources.  Focusing on the issue of online brand protection, Mr. Peterson gave some interesting examples of how failing to protect your brand online could lead to your customers being diverted to other websites, leading to customer confusion and eventually commoditization of the hotel product.  He highlighted some of the techniques being used, including paid placements, where third parties bid on brand name keywords in the search engines and thus divert the customer to the site of their choice rather than the brand.com site, to look-alike domains which on the surface appear to the site of the brand in question but are in reality a third party intermediary.  Failure to manage your brand online leads to a loss of direct business to intermediaries and thus higher costs, and also leads to a loss of ownership of customer data.  The issue is so serious that Mr. Peterson suggests building clauses into contracts with third party intermediaries prohibiting them from engaging in such practices. 

The two keynote speakers were followed by several panels of international hotel executives.  The first focused on “Global Differences in Hotel Internet Marketing”.  This included Richard Lewis, CEO of Summit Hotels, Kristie Wilmott, Director of Distribution, Jumeirah International, Jens Thraenhart, Director of Internet Strategy, Fairmont Hotels & Resorts, Ghislain d’Auvigny, Web Distribution Director, Accor Hotels and was moderated by Peter O'Connor of Institute de Management Hotelier International.   Responding to questions posed by the moderator and the audience, the panel highlighted key differences in the behavior of consumers in the US, Europe, the Middle East and Asia.  For example, Mr d’Auvigny highlighted differences in travel patterns and specifically the importance of trains in the European marketplace, where far more consumers make use of the high-speed rail network to travel distances of up to three hours than in other regions, a characteristic that has influenced Accor’s marketing strategy and prompted the introduction of their innovative scheme “Train et Hotel”. 

The issue of guaranteeing reservations using credit cards was also addressed.  Ms Wilmott explained how legislative restrictions make the use of credit cards as a guarantee mechanism impossible in many parts of the Middle East, and other panel members pointed out that in some European nations, most notably Germany, consumers simply would not use their cards for this purpose.  In both cases, current practice is simply to trust the customer, but it is a very useful illustration of how regional and cultural differences must influence the way in which we do business.  The panel also noted how differences in language and culture mean that to effectively market yourself electronically outside the US, you have to be prepared to invest a lot of time and effort understanding each marketplace and developing specific promotions and solutions that address its unique characteristics.  A single Anglo-Saxon orientated approach is unlikely to work.

The second panel focused on a similar theme - “Multi-Lingual Websites / Globalization” and  included Paul Mulcahy, Regional e-commerce manager, IHG, Gareth Gaston, Director of Internet Development, Hilton International, Andrew Posniak, Director of e-commerce worldwide, Le Meridien and was moderated by John Burns of HTC.  The panel highlighted how localization of both content and sales messages was the key to success.  Simple translation or, as the panel phrased it “transliteration” is unlikely to succeed.  The challenge is to have an international site but remain local, present the content in a way that is clear, concise and relevant to the local situation.  The only way to achieve this is to devolve responsibility for such content down to the local level, which, from a technological perspective, can be facilitated relatively easily using a content management system.  However it is the soft factors that are more troublesome, and the corporate level needs to spend a lot of time and effort on training and communication as to the importance of maintaining such data regularly and to the role that it plays in the marketing and distribution process is key.

The final panel focused on measurement and included Ian Thomas, Strategic Development Director, Webabacus, Didier Guibal, VP International Operations, Rightnow Technologies, Mark Wiggins, Sales Director, Hitwise, Chris Ezekiel, CEO, Creative Virtual and was moderated by Euan Mitchell, Director of e-commerce, Thistle Hotels.  Their overall message was the speed at which the online marketplace was changing and becoming more diverse.  Companies that wish to do well online need to develop an in-depth understanding of their customers and react quickly and proactively to changing needs.  Technology now exists to measure and help understand patterns and trends in customer data and help companies to succeed online. However the hotel sector in particular has been slow to make use of such tools, and thus lags behind other sectors, in particular the online intermediaries.  Failure to start managing all aspects of a company’s electronic presence proactively will ultimately lead to a further loss of control, and help drive customers into the arms of intermediaries and competitors.

Overall the sessions were a great success and helped open the debate about key issues affecting internet marketing in Europe.  This one day event will be followed up by a series of monthly conference calls – each focused on a particular key issue raised in the session debates.  Participation in the calls will be open only to senior executives working in electronic distribution in the hotel sector and is by invitation only.

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Contact:
Peter O’Connor, Director, 
IMHI (Institute de Management Hotelier Inetrnational)
ESSEC Business School, France
Tel: +33 1 3443 3177 
Email: oconnor@essec.fr

 
Also See: Peter O’Connor's “An Analysis of the Online Pricing Strategies of International Hotel Chains” Wins Best Research Award at ENTER’S 2002 Conference / March 2002
Brand Erosion, or How Not to Market Your Hotel on the Web / Critical Online Distribution Issues Revisited a Year Later / Max Starkov / June 2003


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