Google Hotel Ads: how it all started
There was a time, not long ago, when the typical booking process involved, chronologically: 1. Google - 2. OTA
More in detail, people first relied on Google to make a very generic search, like “hotel London”. Google returned a whole bunch of hotel results, with the #1 option in the search results always being occupied by an OTA site. That used to be the perfect scenario for Google, considering the huge daily budgets allocated by these OTAs to rank on top. However, such a big opportunity also posed a hidden danger for Google: in fact, people got accustomed to landing on the same OTA sites, to the point that soon many travellers started relying on these OTAs directly when searching for hotels, bypassing the initial search on Google.
80% of Google’s main revenue streams, across all industries, has always been Ads, and such dwindling revenues from a single (and juicy) industry like the Hotellerie could not be accepted.
The solution? Google becoming a direct active player in the Hotel Distribution. Exactly what has happened in recent years and months.
Translated: Google Hotel Ads.
Why Google Hotel Ads is now the Metasearch and even more than that...
So what is Google Hotel Ads?
GHA is a Metasearch engine, just like Tripadvisor, Kayak, Trivago and Hotelscombined that aggregates hotel rates coming from different sources, so that users searching for a particular hotel can compare and choose what the best deal is for their upcoming trip. GHA though is more than just a Metasearch engine, or a rate aggregator, for the very simple fact that… it's Google. In fact, Google Hotel Ads is just a part of an entire travel ecosystem that Google has become, through which potential travellers can plan and execute their travel bookings.
Consequently, Google Hotel Ads has naturally become the Metasearch rather than one among many and, most importantly, it simply works. Ever since 2019, before and even more so during and after Covid, Google Hotel Ads is by far the fastest-growing metasearch engine across all regions. No surprise! Thus, as a hotelier, participating in Google Hotel Ads should be a must.
How does it work? (Revenue models)
GHA is just a new way of doing advertising. Yet, it’s still advertising, so basically you pay to be visible. So how can you pay?
Following are the most important revenue models you can choose from:
- Pay-per-conversion: You pay only when a traveller books your hotel.
- Pay-per-stay: You pay when a traveller completes a stay. This option was introduced by Google after Covid to help hoteliers deal with a very difficult and uncertain situation.
- Cost per click (fixed or per cent): You pay when a traveller clicks on your ad, regardless of whether you’ll get the booking.
Now, you might be wondering: “why should I choose a CPC model when I can play safe and just pay when I get the booking or, even better, when the guest actually stays at my hotel?” The doubt is legitimate and sensible, so is its answer: there’s in fact a simple equation that you always need to keep in mind when playing the Google Hotel Ads game: the safest the revenue model for you, the least profitable for Google.
Put the other way around: the more you are willing to take risks by adopting a CPC model, the more likely Google will be pushing your hotel by making it more and more visible, with potentially way greater returns.
The pay-per-stay model was introduced by Google just after the pandemic started in the first half of 2020, to support hotels in a very difficult moment, but likely this model is going to disappear any time soon and because of the reason above, you can’t expect miracles in terms of results.
That said, let’s see what steps you need to follow to run your campaigns.
How to get started
3 things are needed to have your hotel up and running in Google Hotel Ads:
- An account Google My Business
- An account Google Ads
- A connectivity partner
Google My Business is essentially your business profile, your identity card in the Google ecosystem.
Your Google Ads account is the engine that will deliver your ads. However, standard campaigns via Google Ads do not require any rates and availability, which instead are not only needed but are the real core of Google Hotel Ads. For this reason, in addition to your Google Ads account, you also need a connectivity partner that will grab your ARI (Availability, Rates and Inventory) and send them over to Google to be dynamically displayed to travellers when searching your hotel.
When done, you'll be able to see the campaign type “Hotel” in your Google Ads account.
And that’s pretty much it in terms of groundwork. Now the fun part comes: managing your campaigns. Why fun? Because Google Ads standard campaigns are usually managed by the marketing team, whilst if you want to run successful campaigns with Google Hotel Ads, a joint effort that involves both your Marketing AND Revenue teams is absolutely a MUST.
Following are some of the most important tips to consider when running your GHA campaigns, that will show you just that.
1. Fill up your GMB profile
Many hoteliers take this for granted, yet so many hotel profiles remain unfulfilled, lacking important information, descriptions, pictures, features, that will ultimately hurt your presence in the Google ecosystem. So, do yourself a huge favour and take some time to review your profile, filling up any missing information.
For example, do you offer parking facilities? If so, is it free or at a charge? Either way, say it. Do you offer Free WiFi in public areas and/or workstations? Either way, say, don’t leave anything blank.
This is a MUST, regardless of Google Hotels Ads, but even more so with it.
2. Show multiple room options
Don’t settle for the cheapest room. Google Hotel Ads is your best chance to compete with the OTAs: not only will you offer more options to your prospects, but you will also occupy more space at the expense of other OTAs, therefore being more relevant and prominent.
3. Display your room pictures
People first see, and then read. In other words, visuals have a quicker impact on people’s minds and, by showing your room pictures, your direct channel will visually stand out from all other channels.
4. Show reasons to book direct
One of the easiest, most powerful, yet most underused features available to all hotels in Google Hotel Ads: callouts. Callouts are extensions that allow you to include any additional and relevant information. So, what may be “relevant” in the eyes and ears of your prospects? Simple, all the reasons why they should book directly.
Most times, there is no need to reinvent the wheel and just knowing how the platform works can represent a huge advantage. In fact, all the different pricing options coming from the available OTAs you are connected to are displayed in the same way, so you need to leverage all those possible customizations so that your direct channel gets perceived as the most convenient among all others in the mind of your prospects. A slightly more flexible cancellation policy will perfectly do the job:
5. Always have a free cancellation rate available
Speaking of cancellation policies, the level of uncertainty generated by the pandemic has created the need to work more intensively with flexible cancellation rates and avoid non-refundable options. Thus, make sure you always show up with at least one pricing option when users turn on the filter “Free Cancellation only”.
6. Per-country taxes (included or excluded)
Let’s assume your hotel shows up in Google Hotel Ads with a bottom rate of $100. A US citizen will perceive that rate as being excluded taxes, whilst an EU citizen will likely perceive it as included. As you might have noticed, Google doesn’t display whether rates are inclusive or exclusive taxes, therefore as hoteliers, we have to deal with this country- and cultural-based perception.
The solution? Adapt your tax appliance to the specific point of sales from which the request comes from. This is though one of the many areas where technology is not always on your side: there are in fact many connectivity providers that don’t allow you to adapt taxes based on different conditions, so make sure to ask your tech partner first.
7. Bring Marketing and Revenue together.
Being able to adjust the bidding of any campaign based on different variables has been the prerogative of every advertising platform (Google, Facebook, Bing, etc). These variables were typically marketing-only dimensions like location, language, source, etc. Google Hotel Ads is now tearing down the wall between Marketing and Revenue by including revenue-related dimensions to be used in your bidding.
An example? You can now adjust your campaigns based on the intended Length of Stay so that, for instance, you might decide to increase your bid for searches of 3 or more nights, whilst keeping your budget low for searches of 1 or 2 nights.
This single paragraph would deserve a completely new article, considering the endless and incredible opportunities for all of us to now really skyrocket our revenues with Google Hotel Ads. However, if you wish to know more about all possible dimensions that you can rely on, in order to adjust your bidding, you can check the official page on Google.
Hotel Distribution has always been an unequal struggle for hotels, with the OTAs playing the role of Goliath. No one knows what will happen in the future and the role of Google in the Hospitality industry may change again over time. Nevertheless, this is how the situation is right now with all its uncertainties, yet with these incredible opportunities for us to become stronger and play a much fairer role in this Hotel Distribution game.