Booking.com, which has marketing relationships with the International Cricket Council and the Union of European Football Associations, is playing ball with Major League Baseball.
Pictured is a Spring Airlines A320 bedecked as Booking.com as seen on July 7, 2018. Source: Flickr.com/ Kwok Ho Eddie Wong https://tinyurl.com/4m6a58jf
The company will officially announce today that it has become Major League Baseball’s official online travel partner. Among travel-related services, the league also counts MGM Resorts and Capital One, which offers Capital One Travel, as official sponsors. Marriott has also been a partner.
Booking.com declined to release financial details of the marketing partnership, but said fans will begin to see Booking.com branding in baseball stadiums across the U.S., and there will be a new media campaign getting under way in several weeks.
With the launch, the official schedule pages of Major League Baseball teams will feature Booking.com icons that direct people to search and book accommodations near stadiums.
A recent Booking.com survey found that 49 percent of U.S. baseball fans plan to travel to at least one game in 2023, and 61 percent would be open to traveling as far as 500 miles to see teams play.
Booking.com, based in Amsterdam, has been making significant inroads in the U.S. market, trying to challenge Washington-based Expedia as the market leader.
Would you like a luxury travel subscription from Inspirato with those Amina Muaddi Rosie 95MM Metallic Leather Slingback Pumps from Saks Fifth Avenue?
Saks Stylists will mix pitches to buy Inspirato Passes with style recommendations under a partnership between the companies. Source: Saks
That could conceivably be a sales pitches as Inspirato entered into a strategic marketing partnership with Saks, which would have its Saks Stylists, online and in-store, try to sell Inspirato luxury travel subscriptions to clients. Consumers can choose to get matched with a stylist at Saks for fashion recommendations.
The two luxury companies plans to engage in a variety of cross-promotional efforts once the partnership kicks in sometime between April and June. Saks Stylists would receive training on Inspirato’s variety of travel subscription offerings, such as the combined Inspirato Pass and Club membership, which the company’s website says costs $2,550 per month.
Among elements of the partnership, Inspirato members will receive a pitch to apply for a SaksFirst Card, and they may qualify for status tier upgrades in the Saks loyalty program based on how much they spend with Inspirato. In turn, Saks customers would get access to incentives to buy Inspirato travel subscriptions.
The Inspirato announcement said Saks is its “exclusive luxury retail partner.”
The companies did not detail the financial details of their marketing partnership.
The Hawaii Tourism Authority put two contracts up to bid, one for marketing to the U.S. and the other for destination management, on February 14. The two contracts are essentially a split of the previous one that included both responsibilities and had been awarded to a community non-profit. A government official canceled the it minutes before his term ended on December 5.
The island’s tourism agency is redoing a procurement process that originally represented its shift toward a “local-first” approach. In June, the agency awarded the previous contract (worth $34 million) to Council for Native Hawaiian Advancement over Hawaii Visitors and Convention Bureau (HVCB), which currently markets the island to the U.S. and has done so for over decades with strong support from the traditional tourism industry. The bureau stalled the original contract’s start date through legal protests.
Under the procurement process reset, there’s now a scenario where the convention bureau may end up winning the U.S. marketing contract. The contract would start on June 1, 2023 and end on December 31, 2025.
It’s tough for a National Football League team to make a return trip in two consecutive years to the Super Bowl, but online travel company Booking.com will be doing just that with a fourth quarter advertisement during the telecast.
Here’s the advertisement:
Booking.com Chief Marketing Officer Arjan Dijk announced on LinkedIn that the Amersterdam-based online travel agency would run a spot for the second year in a row featuring its Booking.yeah tagline. Melissa McCarthy, who’s won Emmy Awards and been nominated for Academy Awards, headlines the advertisement, and whimsically touts the wonders of stays at hotels and short-term rentals when booked on Booking.com.
A smart new campaign launched by Hilton, highlighting its connected rooms feature, for travelers looking for larger spaces when booking family or group travel. First in this “Connecting Room Concerts” series, a performance from Brandi Carlile, six-time Grammy-Awards winner – and nominated seven times for tonight’s 2023 Grammys Awards – from a pair of connected rooms at The Beverly Hilton.
Hilton has been a long-time sponsor of the premier music awards, in its 35th year now, with Hilton Honors loyalty program members who get special benefits at the awards.
The Hawaiian government this week rescinded the Hawaii Tourism Authority’s U.S. tourism contract with the Council for Native Hawaiian Advancement, a community non-profit, providing a potential setback for the authority’s sustainable tourism efforts. The reason for the government’s rescission was that the contract needed to be separated into two, one for marketing and the other for visitor management and community relations.
Former Department of Business, Economic Development, and Tourism (DBEDT) Director Mike McCartney made the decision minutes before his term ended at noon on Monday. The Hawaii Tourism Authority (HTA) sits under the Department of Business, Economic Development, and Tourism.
In a letter, McCartney said there needs to be one contract for marketing and another for destination brand management, communication, education, and community-based economic development. “A single contract would not only put us at a competitive disadvantage in the market but also in dealing with the community,” the former director wrote.
The contract award also represented a significant step toward HTA implementing a “locals-first” approach. The authority wants to attract a more high-spending but mindful visitor, one that will embrace Hawaii’s cultural heritage and be respectful of sacred sites and the natural environment.
Since the June contract award, HTA has repeatedly extended its current contract with the HVCB due to protests by the bureau. Its most recent extension was up to March 31, 2023.
With the June contracted canceled, HVCB could very well end up oversee marketing to the U.S. for the next few years. In a statement, CNHA CEO Kūhiō Lewis called McCartney’s recession “unlawful” and said his organization will protest it.
HTA President and CEO John De Fries said the organization is willing to work on a settlement with all the parties involved or start a new procurement process, according to Hawaii News Now.
Either way, the Hawaii Tourism Authority will have to get to work, starting with an upcoming emergency meeting. “My staff and I look forward to discussing this rescission and cancellation at our board meeting on Wednesday and we will work with our board, new DBEDT Director Chris Sadayasu, the State Procurement Office, and Governor Josh Green to explore viable options and align our direction going forward,” said De Fries.
Visit Iceland launched a new campaign to attract space tourists on Tuesday. Called “Mission Iceland,” the campaign kicked off on November 16 with the launch of a billboard into space with the message: “Iceland. Better than Space.”
The campaign targets the space tourist segment and encourages them to see Iceland an alternative destination to travel. Visit Iceland didn’t name any companies, but it cited the ongoing delays for space travel. Virgin Galactic announced in August that it had to delay its first space tourist mission trip to the second quarter of 2023 due to needed ship enhancements.
“We know there is likely frustration amongst aspiring space travelers who have had their trips delayed and don’t yet know when they will make it to outer space,” said Visit Iceland Head Sigríður Dögg Guðmundsdóttir. “That is why we are encouraging them to take a trip much closer to home instead and for a fraction of the price, and the carbon footprint.”
Airbnb executives have talked a lot about how they have reduced their spending on performance marketing (think: buying ads in Google search results) to focus on brand marketing (think: subway posters advertising the company’s new “OMG” category of properties). So how much do they spend on brand and how much on performance?
The short answer is we don’t know for sure. In its first year after going public in December 2020, the short-term rental giant didn’t break out its brand marketing as a share of sales and marketing expenses in its financial results.
This year, though, it began to provide a touch more color, though not enough detail for a full picture.
The company doesn’t disclose how much it spends on performance marketing. Yet it has begun disclosing its year-over-year increases in search engine marketing and advertising spending. In the first nine months of the year, its search engine marketing and advertising expenditure rose by $76.9 million year-over-year. Sadly we don’t know what the total amount of performance marketing was in 2021 to compare it with.
What we can see for sure is that the bump in performance marketing represented a comparatively smaller increase than the company’s increased expenditure on brand marketing. We know that the company increased its brand campaign spending and that the increase was two-and-a-half times as much as the increase of its performance marketing.
In the first nine months this year, the company spent $771.9 million on “brand and performance marketing,” according to financial filings published on Thursday. Of that, $202 million, or 26 percent, represented increased spending on specific brand marketing campaigns.
Sadly, we don’t know the company’s total spending on brand marketing.
But we know the increased spending was meant to support campaigns including its “OMG” category of properties. Since the category’s introduction, the OMG listings have been viewed more than 300 million views, the company claimed this week.
Brand marketing is critical to the company’s ability to continue to attract guests and hosts through direct and unpaid channels, which executives say are cheaper than advertising on Google, Facebook, and other channels.
The company’s other “sales and marketing” costs included personnel-related expenses for its communications teams and for “policy,” which cost a separate $335.7 million in the first nine months of the year — representing a 3 percent increase year-over-year.
Added up, the company spent about $1.1 billion on “sales and marketing” in the first nine months of this year. That was about 17 percent of revenue, far lower than what traditional online travel agencies spend, as Skift has analyzed before.
Boosting Incentive Payments to Customers?
An unspecified amount of Airbnb’s other sales and marketing money was used for referral incentives and coupons. The company has for years made payments to customers via referral programs. Airbnb typically offers a coupon credit for a future booking after a person refers someone to the online agency and that new customer completes their first stay.
The company doesn’t spell out how much it spends on these incentive programs. It appears to mostly lump the amount along with refunds it offers to customers upset with something going wrong in their Airbnb experience.
Intriguingly, the total number of customer payouts for incentives and refunds has increased this year. In the comparable third quarters in 2020 and 2021, Airbnb kept these sums at about $85 million. But in the third quarter of 2022, the total number of incentive payments and refunds rose to $152 million. That was 78 percent more.
Have refunds gone up as the pandemic has ended? Perhaps. But it’s also possible that the company instead increased its referral and related marketing programs, such as where it offers coupons. The company hasn’t broken out the details.
Energy Credits for Hosts in Britain?
On Thursday, the company debuted another type of brand-boosting program. In the UK, Airbnb debuted a sustainable hosting fund worth about $1.1 million (£1 million) to help property managers who want to make their lodging more energy efficient.
Many hosts are struggling to cope with spiking energy costs in the UK because Russia is disrupting energy supplies to Europe during its war on Ukraine.
Airbnb will make grants to hosts of about $3,300 (£3,000). Qualifying actions include switching to a more energy-efficient boiler or heat pump and insulating a roof. Details are at the company’s sustainability fund site.
A company that helps advertisers streamline modern ad campaigns is moving further into the travel industry through a new partnership.
Clinch, headquartered in New York City, said this week that it had started a “new relationship” with Nebraska-based Sojern.
Clinch’s so-called “flight control” software suite is meant to help advertisers more easily build data-driven, personalized ad campaigns.
Sojern is a travel-focused digital marketing platform that uses consumer data to help hospitality companies secure bookings. The company, founded in 2007, has driven more than $15 billion in bookings for thousands of partners, according to its website.
The companies say that the partnership allows Clinch users to access Sojern’s capabilities.
“The ability to personalize and auto-optimize campaigns to match both environmental and user-based situations is paramount for this sector,” said Charel MacIntosh, head of business development and partnerships for Clinch, in a statement.
“Google will kill Airbnb,” tweeted Nick Huber, who writes about business and real estate, owns a self-storage company, and has 247,000 followers on Twitter.
Two people independently messaged me about the tweet, which has generated a few thousand “likes,” and hundreds of retweets since Sunday.
One Skift colleague said of the tweet: “Everything this guy says in his tweet thread is wrong.”
Conversely, a superhost in Europe messaged me about Huber’s tweet: “I would have to agree. Everybody loves a direct booking (both hosts and guests), with no whopping service charges.”
A Tripadvisor vacation rental in Miami listed in Google Vacation Rentals. Source: Google
Hosts Just Need to Put Links to Properties in Google … Hmmm
If only it were that simple.
Huber argues that hosts and guests can avoid Airbnb’s substantial fees, and both can save money with direct bookings. Actually, he claimed that Airbnb takes 25 percent of the transaction, mostly from guests, in the form of fees, which seems excessively off the mark.
After this story posted, travel industry veteran Drew Patterson tweeted that Airbnb revenue was only 13 percent of gross bookings in 2021.
Might also mention his math is wrong on margins / take rate. In 2021, ABNB did $6B revenue on $46B gross booking (13%) vs. his claim of 25%.
One of the silliest things Huber tweets is, “All it takes is folks putting a little link to their software in the Google listing. Management co manages that directly. Way more revenue to owner and less cost to guests.”
Alas, graveyards full of startup companies from Palo Alto to Madrid and Mexico City are testimony to the fact that you can’t merely put a link on a Google business listing, and expect millions upon millions of customers to discover it, and then use it. It takes a mammoth amount of resources to attract direct bookings and for a vacation rental business to build their own brands.
Hey, direct bookings would be mostly great for hosts and, to a lesser extent, guests, but how can property owners and managers attract them?
If you look at the global hotel industry, it has done an admirable job over the last few years, spending huge sums in advertising to urge customers to book directly on their own websites, where they have the lowest rates, instead of using online travel agencies.
Hotels have made significant strides in this regard in attracting direct bookings, but the vast majority of them still rely on online travel agencies to attract price-conscious consumers who care little about whether they are staying in a Marriott or a Sofitel.
Hotel direct bookings haven’t killed Expedia or Booking.com. Travel, it is often said, isn’t a zero-sum game. There is ample room for multiple winners.
Property owners use Airbnb for a reason: Airbnb has a great brand, and attracts legions of guests who start searching for places to stay on Airbnb instead of beginning their trip-planning on Google.
How does the host with one or a handful of properties compete with that kind of market power?
Direct Bookings Have Risks, Too
And although guests can avoid Airbnb’s fees by booking direct with the host, they run the risk of having no one to turn to if the host or property turn out to be a nightmare. Whether or not they work as well as advertised, Airbnb has some insurance protections in place for both hosts and guests.
Airbnb critics will be quick to say that Airbnb’s customer service for guests can be challenging, but it’s often better than dealing with hosts who have no brand or track record to stand behind them.
In fact, Google’s travel vertical has a vacation rentals feature, and it hasn’t really distinguished itself or put much of a dent in Airbnb’s growth precisely because Airbnb, and other big vacation rental brands, have shunned offering their homes and apartments through Google vacation rentals. So Google is hardly usurping Airbnb on that front.
Google has certainly damaged the businesses of innumerable travel companies because of its near-monopoly in search and the way it preferences its own travel advertising features. Curiously, although most of the far-out theories about Google taking over the travel industry tend to say that Google will transition from an advertising to a booking platform and would become an online travel agency — a switch that Google has shown little appetite for — Huber isn’t even making that argument.
Instead, he’s arguing that Google will serve as a listing platform, and build advertising around it, and that hosts, with an assist perhaps from property managers, would see direct bookings flow like lava down a hillside because these offers are inherently the best and cheapest deals for both hosts and guests.
Both Google and Airbnb Face Headwinds
Google killing Airbnb begs the question of which of the two has momentum versus the other. Both face big antitrust or regulatory challenges, and it’s hard to choose which one has the more daunting obstacles.
A little deeper into his twitter thread, Huber retreats a bit from his Google killing Airbnb opener, and pleads for “nuance.”
“Of course Airbnb will always have users,” he tweeted. “But over time many guests will go on google, find a vacation rental in an ideal location, click through to that website & book w/o paying hundreds in fees. 20 yrs from now ABNB will be a glorified lead generator.”
When it comes to predicting the future of companies two decades from now, I’ll pass on that one, considering it is difficult to look even two or three years ahead to see what the business world would look like.
So, alas, in Huber’s view, his talk of Airbnb’s death was apparently bombast.
When a twitter user tells Huber he downplayed the importance of factors like trust and reliability when considering direct bookings versus reservations through Airbnb, Huber retreats a bit further, tweeting:
“I think there will be an increased number of guests going directly. You can do all of those things without giving a huge chunk to Airbnb.”
Finally, that’s something we can agree with: There are many hosts doing everything they can to generate direct bookings, and they’ll likely have a degree of success. But I don’t believe “Google will kill Airbnb,” or that Airbnb will close shop anytime soon.
Note:This story has been updated to include additional information on Airbnb’s take rate. It also clarified Google’s role in the travel industry.
