The Importance Of Digital Marketing In The Hospitality Industry – A Case Study

Industry analysis

Business nowadays is not just limited only to word-of-mouth publicity kind; it actually has identified a lot other potential marketing tools. Few of the examples of marketing tools are search engine optimisation (SEO), Pay per Click Advertising (PPC), ‘Social Media Marketing’ and Content Marketing (Levy and Gvili 2015).

The case study company ‘YourHome’ is a small family owned business that provides both accommodation and breakfast services to travellers. The business is known as bed and breakfast (B&B). They offer budgeted accommodation to travellers and have become quite a popular name in the town. The business has been running quite well; however, with the arrival of chain-hotel of a reputed brand, the business is now getting hampered. The hotel chain is offering cheaper accommodation charges and their rooms are much more modernised & attractive as well. The case study company has already lost their few customers. Adding to the worries the case study company does not have any digitalised platform which could promote their image to a wider customer and construct a new brand image. The hospitality industry is the fourth largest industry of Britain. The industry reported to being contributed over £115 billion per annum to the UK economy. It has reportedly created 153,000 new jobs in the two years period from 2010 to 2012 (Bandbassociation.org 2018). Additionally, Britain is considered as the leading nation in the B&B industry. In fact, five of the top 10 B&B service providers are from Britain (Bandbassociation.org 2018).   

The study is aimed at understanding the importance of digital marketing from the perspective of Case Study Company as it struggles to post any competition to the newly opened hotel-chain in the same area.

Industry analysis: The prospects in the B&B industry can be understood from the survey reports of England Occupancy Survey (EOS). ‘EOS’ measures the bed-space and bedroom occupancy across the accommodation sectors in big-size hotels to small-size B&Bs and farmhouses (VisitBritain 2018). They provide reports on accommodation type across the country.  The data is collected through the reports submitted by the panel that consists of the various kinds of participating accommodation formats. The different types of accommodating formats like the hotels and the B&B submit their data every month (VisitBritain 2018). However, some changes have happened to the system in June 2017. The panel is now bigger and is known as a syndicate panel which now has more than 3,000 hotels & other kinds of accommodation service providing formats. They now also set a benchmark for a specific company, so that, a meaningful comparison can be drawn on an annual basis (VisitBritain 2018).

Illustration

The survey report suggests that the flow of customers or the travellers have remained more or less the same in the time span 2015-17. The number of visits has remained quite good in every month though have little variations which are significantly evident in December and January months. The figure also suggests that there are potentials in the accommodation sector.  

Illustration: The case study company seems to have been following the traditional style of marketing. This looks quite evident in a fact that they are only involved in word-of-mouth kind of marketing. They do not have any digitalised platform where they could have possibilities to reach to a million of customers in a very less span of time. On the other hand, the strategy that the case study company follows is quite time consuming and possibly not a potential choice to reach to a large customer base. This is quite unrealistic as well considering a fact that the B&B industry is booming and Britain is at the top position at the global level (Bandbassociation.org 2018). It further means that the case study company is offering a decent service at cheaper prices but they are yet to take the advantage of the opportunities which are ample there in the B&B industry. Adding to this, they have a very outdated website that lacks in attractive and engaging contents. Aspiring travellers may be able to get the required information but then they would not feel like being through the website every time as it could have happened, had they considered the digital marketing strategy to make it look like more engaging (Stone and Woodcock 2014).

Results of the strategy analysis / Recommendations: Considering the fact as stated above, the case study company needs to have the sufficient resource, so that, it could take the advantage of ample of opportunities which are there in the accommodation sector. The case study analysis being a small family owned business, it is yet to consider a switching to the digitalised platform where they have adequate responses to visitors database management and the digital marketing. Digitalisation is important from every perspective and the case study company must get digitalised through two digital strategies like Customer Relationship Management (CRM) and Digital Marketing (Karjaluoto and Ulkuniemi 2015).

Assumptions: CRM is important for maintaining a customer database, integrating various operational divisions at just one platform and integrating the CRM with the social media marketing. The customer database is necessary to realise the choices that the existing customers have from the case company. It was due to the incapability to read the customer’s desires that few of the existing customers have preferred switching over to recently opened a reputed hotel chain. Moreover, using database only they could be able to meet the demands and offer relevant services to existing customers. Additionally, CRM could also be integrated with the various social media platforms. Additionally, data of a wider audience base can then be produced which is necessary to make the necessary amendments, so that, the case company is able to retain its existing customers and attract more new visitors in future (Tseng 2016).

Results of the strategy analysis / Recommendations

Social media marketing is another way to digitalisation that the case company needs at the moment. Social media platforms like Facebook, YouTube, Twitter, and Instagram can be quite beneficial for bringing the much needed digitalisation in the case study company. Images and video could be uploaded to the Facebook platform. It takes a very little time and people start noticing the advertisement. However, the content and the graphics need to be attractive and engaging as well. In case of video, the first 5 to 10 seconds is important as people, on most occasions, do not like entertaining a time waste video ads. The first 5 to 10 seconds of the video is vital and needs to be of great quality (Ashley and Tuten 2015).

YouTube is also very important and may help to attract the attention of a million of customers in a very less span of time. The company can prefer uploading either a short or a long clip. Videos can be uploaded to a channel which is specific to the company. Viewers can be asked for a subscription to the channel at the end of every video. The profit through YouTube campaigns is in direct proportion to the number of the subscriber to the particular channel (Constantinides 2014).  

Table 1: SWOT analysis of YourHome

Objectives with CRM-

• To attain the highest standard of customer service
• To maintain a customer database
• To integrate various operational domains at just one platform
• To incorporate it into the social media platforms, so that, responses of viewers could be monitored & measured

• To enhance the business productivity by increasing the number of visitors
• To reach to a wider customer base through Facebook, YouTube, Twitter and Instagram
• To attain some revenues from social media marketing
• To generate ample of leads for company’s CRM

The digital platforms ‘CRM’ and ‘Social Media Marketing’ are being proposed to yield some benefits, so that, the case company could stand strong in competition and be able to attract & retain the travellers. CRM is being proposed because it systemizes the operations. The different operation domains can be integrated into just one platform. Hence, it is accessible from remote areas also. Most importantly, different data can be stored in the software. Moreover, an accounting professional can now be able to cross-check the entries by matching this with the other department’s data like the sales department (Basit et al. 2017). It also can be integrated with the social media platforms which are necessary to monitor the viewer’s reactions to text, image and video ads. Moreover, a lot of useful data can then be made available to the case study company. The company may then be able to deliver more specific services to travellers by making the required amendments (Mullins et al. 2014).  

‘Social Media Marketing’ can be a platform for not only reacting to the audience but, also making significant revenues. The number of subscriptions at the YouTube channel will go on increasing the revenues. On a similar note, the number of likes on Facebook will also fetch revenues. The case company can then be able to draw good revenues while pulling more travellers influenced by the advertisements (Dahnil et al. 2014).

Strengths

Purpose-

The purpose of the CRM implementation is to enhance the customer service standard. Moreover, customer loyalty level will then be increased. Additionally, marketing activities could also be tracked. ‘Social Media Marketing’ was necessary as the case company had just relied on traditional marketing strategies. They did not even utilise it properly and kept on confined just to word-of-mouth publicity. The digitalisation had missed which is why they found it difficult to understand the reason behind travellers being switched over to the recently opened hotel.

Key skills-

Before implementing the CRM, it is necessary to identify the CRM for their purpose. The range of CRM is available in the market; however, not every single CRM is made for the particular case. Post CRM implementation will require trained professionals from within the company who can efficiently manage and track the performance. It is necessary to identify the downtime or else unnecessary charges will then be paid to the vendor. It is also necessary to identify the number of operational domains which will be integrated with the CRM (Elena 2016).    

Advertisements on Facebook can be created by following some strategies like selecting the number of characters in text, size & resolution of the image and the video size. Additionally, call to action button like Shop Now, See Menu and Learn More can be established. Once the strategies have been developed, the next move will be to approach an appropriate advertiser that can construct the advertisement based on the strategies being provided to them. The similar process will be followed on Twitter, Instagram, and YouTube. However, call to actions button may be different for different platforms (Leung, Bai and Stahura 2015).

Expected change-  

With this new CRM, the company may be enjoying an enhanced customer satisfaction. Additionally, they may also be enjoying an increased customer loyalty. The business is expected to get better with an improved understanding of customer demands (Gu et al. 2017).

The proposed social marketing may be helping to attract a wider audience base from different parts of the world. Healthy revenues are expected in future. The number of travellers may be increasing due to increased awareness in social media for the service and the service provider (Balakrishnan, Dahnil and Yi 2014).

The digital strategy implementation includes the installation of CRM software. CRM is a software application which is programmed with coding with the chosen language format. The languages used in CRM are C# and ASP.NET (Gu et al. 2017).

Weaknesses

There are other digital marketing platforms like search engine optimisation (SEO) and Pay per Click (PPC) advertisement which has not been proposed for the case company. This is because it will take time to actually realize the importance of the other platforms. Once, it is being found that CRM and social media marketing have fetched good values then that will be the most suitable time for hitting again with the SEO and PPC.

Conclusion and Future Work: 

Therefore, the case company needs to implement CRM and go with the ‘social media marketing’. This is necessary to reduce the threats of the rival hotel in the same town. This is also important to redefine the value of YourHome to its customers and the others. They had first initiated the concept. They should be getting ample of shares from the market. This is only possible if the existing strategies are successful as it will open up doors to more advanced advertising platforms like SEO and PPC.

The future work will be to identify the exact outcomes of the implemented ‘CRM’ and the ‘Social Media Marketing’. If the outcomes are encouraging then the further study will be in the advanced form of digital marketing which are the SEO and the PPC.  

References:

Ashley, C. and Tuten, T., 2015. Creative strategies in social media marketing: An exploratory study of branded social content and consumer engagement. Psychology & Marketing, 32(1), pp.15-27.

Balakrishnan, B.K., Dahnil, M.I. and Yi, W.J., 2014. The impact of social media marketing medium toward purchase intention and brand loyalty among generation Y. Procedia-Social and Behavioral Sciences, 148, pp.177-185.

Bandbassociation.org. 2018. Bed and Breakfast Association – the UK trade associaton for B&B owners and guest house owners. [online] Available at: https://www.bandbassociation.org/ [Accessed 24 Mar. 2018].

Basit, A., Tahir, A., Khan, M.M. and Latif, M.I., 2017. Tacit Knowledge Augmented Customer Relationship Management Systems: An Empirical Investigation. Pakistan Journal of Commerce and Social Sciences, 11(3), pp.1005-1026.

Constantinides, E., 2014. Foundations of social media marketing. Procedia-Social and behavioral sciences, 148, pp.40-57.

Dahnil, M.I., Marzuki, K.M., Langgat, J. and Fabeil, N.F., 2014. Factors influencing SMEs adoption of social media marketing. Procedia-social and behavioral sciences, 148, pp.119-126.

Elena, C.A., 2016. Social Media–A strategy in developing customer relationship management. Procedia Economics and Finance, 39, pp.785-790.

Gu, V., Davis, J., Cao, R. and Vogt, J., 2017. The effect of externalities on adoption of social customer relationship management (SCRM). International Journal of Quality Innovation, 3(1), pp.11-16.

Karjaluoto, H. and Ulkuniemi, P., 2015. Digital communications in industrial marketing. Journal of Business & Industrial Marketing, 30(6), pp.3-15.

Leung, X.Y., Bai, B. and Stahura, K.A., 2015. The marketing effectiveness of social media in the hotel industry: A comparison of Facebook and Twitter. Journal of Hospitality & Tourism Research, 39(2), pp.147-169.

Levy, S. and Gvili, Y., 2015. How Credible is E-Word of Mouth Across Digital-Marketing Channels?: The Roles of Social Capital, Information Richness, and Interactivity. Journal of Advertising Research, 55(1), pp.95-109.

Mullins, R.R., Ahearne, M., Lam, S.K., Hall, Z.R. and Boichuk, J.P., 2014. Know your customer: How salesperson perceptions of customer relationship quality form and influence account profitability. Journal of Marketing, 78(6), pp.38-58.

Stone, M.D. and Woodcock, N.D., 2014. Interactive, direct and digital marketing: A future that depends on better use of business intelligence. Journal of Research in Interactive Marketing, 8(1), pp.4-17.

Tseng, S.M., 2016. Knowledge management capability, customer relationship management, and service quality. Journal of enterprise information management, 29(2), pp.202-221.

VisitBritain. 2018. Accommodation Occupancy: Latest results. [online] Available at: https://www.visitbritain.org/accommodation-occupancy-latest-results [Accessed 24 Mar. 2018].

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