Travel marketing is a bitch

Digital marketing is a great way to burn lots of cash, now more so than ever. It used to be that SEO and Adwords were the only game in town. These days we’re scrambling for mobile strategy and attribution models; first we needed a plan for Pinterest, then it was Instagram, now it’s video. Even when you (sort of) know what you’re doing it can make your head spin.

spaghetti

Are you doing content marketing or just chucking spaghetti at the wall?

And then you have to do it all in travel. Admittedly I’m biased, but is there a more challenging B2C industry for marketers? Over the years I’ve noticed three fundamental features to travel marketing that are the bane of many businesses—especially SMBs—and the downfall of many a travel startup.

Here’s my take from a decade or so in travel marketing. What’s yours?

Acquisition costs are ridiculously high

Until fairly recently, even smaller travel businesses could expect to do okay on the “free” traffic generously supplied by Google. A few meta tags here some cheap content there, throw in a shit-ton of dodgy links and up the rankings you went.

For better or worse those days are largely over. SEO gimmickry is too risky and the first page results for any vaguely competitive travel query are stitched up by top tier brands.

When I started out in travel SEO ten years ago a query like “Peru vacations” would yield a mixed bag of independent operators and specialist companies. Try it now and you’ll get a monoculture of aggregators and top-tier OTAs, occasionally punctuated by some of the larger operators.

SEO isn’t “dead” but it has changed beyond recognition.

This trend forced the minnows into paid channels—originally Adwords, more recently Facebook. But ad networks are auctions where higher demand means higher prices, so having been forced into paid traffic acquisition these companies simultaneously faced an ever increasing cost per click (CPC).

These days an Adwords CPC for travel queries can range from $2 to $7 and beyond. Depending on a website’s conversion rate that can shake out at a cost per acquisition (CPA) at anywhere from $40 to $200+.

With non-ecommerce websites an acquisition is usually a lead or enquiry that must then be closed by a sales team. That’s an awful lot of money to be paying for an enquiry.

This isn’t just a travel thing—the exact same process has unfolded across all industries and the collective response has been the move towards content or “inbound” marketing. Roughly speaking this is about acquiring eyeballs further up the funnel where clicks are cheaper but less purchase ready, and then creating ways for some of them to come back later when they’re ready to make a purchase.

When done right this approach can certainly work. But for travel companies, the second big problem is that:

The customer journey is ridiculously long

There’s plenty of research on the time and length of travel purchase decisions, but we intuitively know that the process from an initial spark of inspiration down to actually booking a trip can take months, years or even decades.

And at each step of that journey people are drawing on 3rd party sources of information, reviews, distractions and competing offers.

So once you’ve been forced to shift your acquisition efforts earlier in the customer journey, you’re instantly plugging a leaking funnel and battling exponentially diminishing conversion rates.

Using content to “build audiences” is fine in theory, but it’s painful to think that many of these people could be months or years away from making a purchase.

(This, coincidentally, is why most “influencer marketing” has such a thorny relationship with attribution and ROI. “Impressions” up in the inspiration phase of the customer journey have a tenuous connection with bottom line KPIs like bookings and revenue.)

But it’s not impossible! If you’ve got the resources to create great content and the expertise to use social media, email and retargeting in a strategic, joined-up way, content marketing can definitely work for travel companies.

But the third fundamental problem is that:

Purchase frequency and customer retention are ridiculously low

All of this would be okay if leisure travel, like many other consumer industries, had reasonable purchase frequencies and high retention rates. But even in the biggest markets, people typically travel only a few times a year, with just just one or two international trips at most. Single destination operators are at a further disadvantage—how many travellers go back to the same place with the same company every year?

Even for the few companies with loyal customers who repeat book each year, that’s still a punishingly low retention rate compared to the up-front acquisition costs.

This means that even after being forced further up the funnel, where customer acquisition becomes more indirect, longer-term and leakier, the few people who do eventually book may never come back again!

Put these three factors together and you’ve got an extremely challenging environment for travel marketers, especially those on limited resources.

What to do?

There is a way through the morass, but you’ve got to work with these fundamentals, not against them.

High funnel acquisition efforts should have a relentless focus on delivering value and embrace the fact that, at this stage of the customer journey, people usually aren’t ready to book.

See Compass Magazine from Cox & Kings or Travel by Lightfoot, an email magazine from Lightfoot Travel; both are classic demand generation activities. Neither is overeager to force enquiries and bookings; instead they are used simply to bring early stage audiences into each brand’s funnel.

For those on more modest budgets, think in terms of demand capture rather than demand generation. Use content strategically, such as downloadable assets, to capture audiences when they begin to research a destination or experience. This is still high funnel activity with relatively low acquisition costs, and it gives you an easy way to convert casual audiences into qualified prospects.

Paid channels are cheaper when the traffic is less purchase-ready and the competition is less intense. Use digital ads earlier in the customer journey, and be smart with email and retargeting to build as watertight a funnel as possible.

The key to all these activities is providing as much value and quality as you can afford, and not prematurely forcing people towards bookings. They’ll book when they’re ready, not because you’ve filled their inbox and Facebook feed with promotions. Use different channels strategically and with restraint to provide a compelling, consistent experience as they make their own way down the journey to purchase.

A lot of this is anathema to marketers on tight budgets. But, when done right, it works out more cost effective than throwing ever more cash at Adwords and Facebook. It takes restraint, patience and plenty of added value. All things that, in an era of splogs, spam and relentless retargeting, can go a long way to win over your audience.

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