Here’s what travel and hospitality brand marketers can do to overcome “consumer anxiety about inflation” and beat their competitors.
Published: June 14, 2022
Travel hospitality brands have shown incredible resilience over the past couple of years as people around the world have significantly reduced vacation and work travel. For airlines and hotels around the world, the number of U.S. consumers traveling overseas has dropped sharply in 2020 and is still about half of what it was before the pandemic began. While traditional hotels looked to see opportunities for a big recovery last year, much of that revenue went to increasingly popular alternative lodging brands like Vrbo and Airbnb.
However, hope is not far off for all players in this sector. Travel and tourism is projected to bring $8.6 trillion to the world this year, just 6.4% below pre-pandemic levels.
At the same time, Americans are reportedly hesitant about how much money – if any – they want to spend on summer holidays due to inflation. With this critical season of travel and hospitality fast approaching, let’s take a look at what brands need to know to maximize their business results.
Advertising spending goes digital
Travel and hospitality brands should not skimp on advertising budgets because competitors are likely to do the opposite and therefore own most of the summer market. In 2021, travel marketers spent 38% more than a year earlier and are expected to spend 36% more this year than last year.
Marketers in this field seem to have realized that they need to invest in order to win. We recently saw Vrbo, Expedia and Booking.com acquire high-value broadcast ads reaching an estimated 100 million consumers during Super Bowl 2022. Airbnb also recently ran a major ad campaign that focused on TV.
But while television communicates a brand to a wide audience of potential customers, marketers have little control over targeting and do not know if sales were the result of advertising. That’s why advertising dollars are shifting more and more towards digital.
With targeting and measurement far superior to broadcast, digital advertising offers audience segmentation that broadcast and outdoor advertising cannot, allowing travel and hospitality brands to reach the right consumers who are closer to the point of purchase. With the help of data and analytics, travel and hospitality marketers can pinpoint which consumers are planning to travel, who are most likely to buy traditional or non-traditional accommodations, and then target ads to the most likely buyers.
More importantly, they can see exactly how successful a campaign was on a granular level with additional measurements. That’s why travel and hospitality brands are predicted to spend 70% of their budgets on digital advertising next year, up 63% from 2020.
Digital advertising also…