Overview
A hospitality client in the Central Coast had experienced two successive calendar years with declining revenue. Screechy Cat Media reviewed their entire marketing + advertising mix and determined that paid search was severely underperforming, negatively impacting marketing and ROAS across the board.
The Problem
Our hospitality client’s 24-month decrease in revenue began after several seasons with increased sales and revenue, which the client credited to their newly-launched multichannel ad campaign. This revenue decline was so detrimental to our client’s busines operations, it forced them to partner with several additional third-party resellers (reducing profit margin), lower prices, and initiated a death spiral in which there wasn’t enough money for marketing, further reducing sales, and on and on.
What we found—and what we did next
A once high-performing digital advertising campaign began to fall apart due to lack of optimization and automated bidding. This breakdown in performance on paid search not only impacted results from that channel (which itself is typically the top-peforming for small businesses)
Competitors and third-party resellers were constantly outbidding our client on their most important keywords: their own brand. While not against the rules, branded keywords should be the easiest for brands to own the #1 position, and are almost always the lowest cost but highest converting keywords. Our client was also optimizing to clicks on both branded and non-branded keywords, despite having access to conversion tracking and revenue reporting.
Screechy Cat Media rebuilt our client’s paid search campaign from scratch: developing tightly-themed ad groups for branded, category, and competitor keywords. Ad copy was tailored to reflect the search intent of each keyword group, all of which led to the most appropriate landing page based on the query (instead of the homepage, where all traffic was previously sent). Bidding was shifted to a Target CPA, to ensure Google was optimizing to our overall campaign goal (sales).
Results
During the first peak and off/need seasons after Screechy Cat Media launched the client’s new search campaign, cost per click on search traffic decreased 43%, and return on ad spend improved from 4.5x to 6.7x on all digital advertising tactics.
But the real story was revenue: after 2 consecutive years of declining revenue, our client saw a revenue increase of 22% during the next peak season, and a whopping 41% during off/need periods. As a result, the client’s overall revenue improved for the first time in 3 years.
The efficiencies gained through optimization also enabled our client to re-invest some budget previously spend on search advertising to begin advertising on social media. Paid social ads have driven more than a 2.0x ROAS since launch.
What this means for you
Paid Search can be one of the most effective hospitality advertising tactics: but it rarely works as a “set it and forget it” play. Seasonality, competition, and industry changes can mean new keywords, more competitive bidding on branded terms, and a need to maintain both keyword list and bids on an ongoing basis.
Increasing revenue is something everybody wants, but beyond the obvious, immediate benefits, optimizing the delivery of your paid search efforts can free up budget for additional advertising channels. While paid search is highly effective, it is a mid to bottom-funnel play, and generally isn’t the best option for bringing new visitors to your website. ConnectedTV, lookalike targeting on social media, and contextual advertising via programmatic display are all much better ways at finding new customers, and by freeing up budget on paid search, these channels become an option in your marketing mix.
Download this Hospitality advertising case study
You can download Screechy Cat Media’s hospitality case study below. If you run a hospitality or tourism-based business and are looking for ways to help improve bookings, revenue, and efficiency, head over to our scheduler and set up a free, no obligation consultation.
