Tag Archives: International Travel

A Greek Lesson

I think that one of the overwhelmingly consequential stories of 2011, was that of the Greek financial and social issues. The topic has been covered very thoroughly by the world media, so I am guessing that just like me, you will have mixed emotions about my fellow countrymen as a whole.

On the one hand, the irregularities (ranging anywhere from innocent mistakes all the way to blatant stealing – from both Europe, but also from the poor to give to the rich) have happened within the country itself. Unquestionably it has been the Greeks making their own bed (albeit messing up everyone else’s as a result) and that apportions blame squarely and wholly somewhere within the country.

On the other hand, under several very misguided and very unfair governments for almost 30 years now, it is typically the “non-thieving” hard-working type of Greek (majority) that is paying a very disproportionate price for all the irregularities that went on. Which is also hard to forget…

To use some culinary parallels to explain my views: whatever your position on the matter, I believe that the whole mess can be boiled down to a few key ingredients that have been cooked by certain people (from what in Greece is now called “the elite”) for almost three decades; unfortunately these were the same people that also happened to be in control of the books which were also thoroughly cooked.

From these few ingredients, the one that is very easily underestimated is complacency. And in my experience complacency is a very contagious disease.

“The Greek physics law of Inertia” – AKA the Greek version of “mañana”

The one thing for which I will dare to “throw a stone” to my countrymen is that us Greeks are pretty much governed by some cultural imperative, similar to the physics law describing inertia. When we aren’t doing anything, we are very likely to maintain our state and continue not doing much. (Incidentally, although much more rarely, the opposite also applies: when we somehow find ourselves in motion, we can find it difficult to stop). All this can make us relaxed company and great party friends, but in business it can be a disadvantage…

During the autumn of 2007, when our BABEL Multilingual product was still in its infancy, I was starting talking to hotels about multilingual versions of their websites, and international marketing packages. Knowing that Greece attracts people speaking foreign languages in their millions every year, I did some research in new hotels in the country that were more likely to use and benefit from our services.

Amongst many potentials, I remember finding a wonderful candidate. It was a five star property with some 450 rooms, in a prime location in Crete, near an airport (but far enough) and by a superb sandy beach. The hotel was independently owned, and only on the second year of its operation – which to me it meant that there would normally be a lot of room for growth of business. To cut a long story short, this property’s vital statistics made them an excellent candidate. According to my guestimations at the time, they could find themselves generating some pretty impressive profits within the first season of using us. I couldn’t wait to talk to them..

Unfortunately, my initial enthusiasm quickly evaporated by the hotel’s lack of a booking engine on their website. In fact, there was no way to make a reservation at that hotel, other than calling them, or emailing them and hoping for the best. Obviously there is very little point in pursuing, finding and getting visitors to your website from abroad if you don’t have a way to convert them to customers!

For those of you that aren’t familiar with the issue of booking engines, I should briefly highlight here that for such a property having a booking engine is an absolute necessity. I don’t want to send anyone to sleep talking about a the different pricing models of agencies and the comparative costs; so let’s just say that in a country like Greece, a decent-sized independent hotel of this type on its second year of operation, would easily pay the equivalent of 30% for a reservation in commissions to all manner of agencies. Forgetting about the numerous benefits that further enhance the argument and necessity for a booking engine, I will just mention that when someone books a hotel on the hotel’s own website, the commission costs for that hotel would drop to anywhere between one and five per cent. It is relevant to mention here that agencies already squeeze hotels as much as they can, and as hotels have costs associated with servicing a room, bookings over the hotel’s own website represent a staggering benefit in  profit levels – a 25% reduction in commission payments could be very nearly the entire profit on a room sold!

So why on earth would anyone not have a booking engine – I hear you ask. I didn’t know either and I was too curious to let this go, so I decided to find out. I picked up the phone, got through to the General Manager, and basically asked the question.

Well, someone would have to manage it..” – came the answer.

[What? As opposed to bookings from agencies that are OK to be left unmanaged?!!]

I was shocked. That was a prime example of (these days already hard to find) old-style Greek public-sector complacency having permeated the private sector. Of all the people to show such lack of interest in the hotel’s well being, to hear such a blatant statement of laziness from a General Manager… To me, that was just wrong.

A year after this conversation took place, the financial world imploded. Today travel agents control the business for that hotel (and so many other hotels like it) and have forced the General Manager to drop her prices and increase the commission she pays to them. The owners were probably far too removed from the day-to-day decisions to identify the missed opportunity, and have now fully blamed the Greek corrupt elite for their misfortunes. Complacency and lack of understanding are a poisonous mixture for a business.

Following that incident (and a few more like it), and seeing the  suffering of Greek hotels in these trying times for Greece, I have quickly developed a strong aversion to complacency. It is therefore with considerable worry that I share with you my suspicion that this affinity to a “mañana” approach to life is not entirely alien to Britons either…

Having worked with hotels from all over the world [and aware that I have no other evidence than our own contacts with the markets (hardly a statistically acceptable sample)] I would suggest that British hoteliers are on average less keen to move forward with international marketing than their international counterparts.

Despite us being a firmly UK based company, today only 23% of our clients are located in the UK – the rest are based pretty much everywhere else around the world. The hoteliers around the world to whom we sell our services seem to be much more aware that hoteliers sell to travellers and that these days travellers don’t come from the hotel’s neighbourhood, and they don’t always speak the neighbourhood’s language.

Looking at the flickering lights of the world economy today, I am strongly advising hoteliers to go after international business even if they do well domestically. Every incremental demand point is of benefit not only to the hotel’s pricing and yielding flexibility. It is also another point of safety in an unsafe world.

If the pessimists of this world are correct, there is a lot of pressure for everyone in the not too distant future, and it will be only those who are prepared that will stand a chance to thrive.

Thank you for reading,

Yannis Anastasakis

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Filed under eCommerce, Hotels, International, Marketing, Multilingual, Return On Investment, Sales Strategies

Foreign gemütlichkeit in the UK

Looking at the primary findings of a recent hotel online market research we conducted, it became somewhat obvious that multilingual international travellers are not “chased” by hoteliers. Unlike the occasionally surprising proficiency one can find in a hotelier’s online strategy when it comes to same-language markets, international source markets are – to put it mildly – mostly ignored. This suggests a significant opportunity for hotels, in the form of what is – in every way that counts – a “new” marketplace; one in which linguistic barriers have so far kept the competition away!

If you are a hotelier, think of your PPC and SEO efforts… do you think you are selling to the Japanese in the same way that you are selling to the Brits? I am afraid that unless you KNOW the answer to be “yes”… you aren’t.

Although this changes dramatically from market to market, the rule of thumb for the top city destinations around the world seems to be that a disproportionally low number of hotels chase international business.

For such markets (think London, New York, Chicago, Miami, Paris, Munich etc.) this imbalance is presenting us with an interesting dynamic of supply and demand. On the one hand we have some finite and proportionately small – and (in most western countries) fairly accurately measured – demand for local accommodation from international markets. On the other hand, we have a very low number of hotels that appear to be interested in, and actively trying to reach, international markets. There also seems to be a very clear divide between large international chains and independent hotels – irrespectively of the standing or reputation of the properties in question.

It would be somewhat impolite for me to point to any specific properties here. But, to get an idea of the point that I am trying to make without naming any names, think of the 5  independent quality hotels in London that spring to your mind. Find them in Google and see if you can find any languages there… Now, I know they have their reasons for this – maybe they really don’t need any more business directly to their website – at least not at an additional cost. However, the conclusion (which will be visited again further down in this entry) is clear. If you want to stay in one of those hotels, and you happen to come from Japan, you pretty much have to find and book this hotel via an agency.

Now, it is personally important to me to mention here that the more I study, the more suspicious I grow of statistics and evidence. However, I have to agree that the figures available to us suggest a staggering opportunity for independent hoteliers, in the international/multilingual markets as a whole. In the case of certain cities with strong international demand, only those hotels that can speak the customer’s language (literally) have the chance to attract international traffic directly to their own website. The rest, don’t.

You Are Not Alone

Figures for international inbound travel to the UK are readily available for anyone with an interest in accessing them. One of my favourite sources is www.visitbritain.org who frequently update their figures and implicitly remind us of the magnitude of the opportunity in the international traveller. A good summary of the latest update on international tourism facts can be found straight on their website here (http://www.visitbritain.org/insightsandstatistics/inboundtourismfacts/index.aspx).

Some of the quoted figures are truly staggering. Almost 30 million visitors in 2010 have generated almost 16.9 billion pounds in revenue to the country, and certain key performance indicators have pretty much stayed the same over the last four years – despite the rare turmoil in the international and domestic markets since 2008. More than half of those visitors (52%) were visiting London.

The Language Mosaic

There is no escaping that we live in a multicultural, multilingual world. The consequential complexities and inconsistent (and even incompatible) patterns of consumer behaviour between the various international markets make marketing to such an international audience a seriously complex affair. The very simple fact that a hotel is ideally trying to sell the same room to anyone in the world who potentially wants to come to the area, makes it all more tricky than we would ideally like it to be.

However, and as it often happens with similar populations, there are some demand patterns that can make our lives a little easier…

The – almost – 80/20 rule

It turns out that almost 70% of all international visits in 2010 happened from the top 10 source countries (only 10% of the countries that have direct flights to Britain). The top ten in terms of market volume and spent can be seen in the table below:

Source: VisitBritain.org 2011

We also know that not all visitors behave the same way. The reasons behind travelling (e.g. VFR vs. Business Travel), the age of the visitor, as well as the source country itself can make a great difference in the suitability of a traveller for any particular hotel.
Furthermore, from a linguistic point of view (and despite that with the exception of two English-speaking countries (USA and Australia) all other top 10 source countries (by volume) are within Europe) the complexity that we are faced with isn’t too scary…

The Big Four

Looking at the table above, and making the assumption that all the Dutch visitors speak English (I have yet to come across a Dutch person that doesn’t speak English better than I do) leaves us with four major foreign language “powered” contributors to inbound international travel in the UK. France, Germany, Spain and Italy. These four countries alone represent exactly one third of all the international visitors that came to the UK in 2010!

Lost in Translation?

According to eye4travel (2008) some 70% of all internet users don’t speak English at all, or are uncomfortable using it for transactions… this is obviously a figure that refers to everyone with a computer and an internet connection, and we would be dishonest with ourselves if we didn’t assume that international travellers are more likely to speak English than the average user. Yet, the significance of language barriers is pretty evident from that figure – 70% is a high number in any language, and so is 60% or even 50%.

In any case, I believe that there are only two significant questions to be asked by any hotelier trying to increase its direct traffic.

1. “Do I think that international travellers understand my site when they visit it?

Before anyone raises their hand to talk about Google Translations and risk giving me an aneurysm (however brilliant and useful their translations tools are) I would like to ask you the even more pertinent and logically preceding question:

2. Do you think that travellers from abroad are actually able to find you online, in order to have the opportunity to try and understand what you are selling to them?”

…..

Even if it were only a minority of international inbound travellers that didn’t speak English (and it isn’t), them being unable to find your website in the first place is – I am sure you would agree – a major issue!

If you are a hotelier and you’re are reading this, the chances are that you are already doing some SEO and PPC for your website. Also, the chances are that you are NOT doing SEO or PPC for your German, French, Japanese etc. potential customers. Hilton is, Marriot is, and crucially Expedia, LastMinute and Bookings do (have a look at the Google screen captures below).

At eHotelworks, when we were thinking of offering the BABEL Multilingual product, we run multiple search tests from several countries for multiple types of hotels, using a variety of languages and IP locations (in other words we were pretending we were searching for UK hotels from abroad).

The results were really fascinating. From certain countries (most clearly show in Holland than anywhere else) the evident problem of being found appeared to be little. In Dutch searches, hotels without international languages on their sites produced mixed results (and much better than we expected).

It seems that the Dutch’s ability to speak perfect English has permeated Google’s results. A lot of hotels – especially in what we call “narrow” searches (e.g. “hotel name” and “location” were used as search terms) – did come up in the first pages, no problem.

On the other extreme, in countries and languages where English is not a prominent language or the language has a significantly different alphabet (Japanese, Arabic, etc.) no searches gave us any independent hotel results at all. Even when we were looking for hotels by their exact name and location, only agencies came back with results. Fascinatingly, Bookings.com – presumably through their very popular xml feed based service – seemed to power the staggering majority of results in the more obscure source markets (such as Greece in the example below).

Have a look at the example of two searches (used the keywords “hotel in London”) here:

First, from England, in English

Search Results for "Hotels in London" in Egnlish, and for England

Even for the traditionally expensive keywords "hotel in London" there is a multitude of hotels having their direct links seen. Especially in the Local Results section.

Then from Greece, in Greek

Results for a search on Hotels in London in Greek

You don't have to speak Greek to notice that there are NO results, either organic or paid for, which belong to a hotel. The OTAs have the opportunity to rule the first pages of Google. Even the mighty Marriott and Hilton of this world have to give those bookings away to OTAs.

The inability of hotelier to market to the many – and obscure – international languages is arguably – and at least in part – justified. As those that do engage in the “get the international traveller” game would testify, the law of diminishing returns applies with unforgiving realism.  After the first few “top-tier” languages have been put together and offered to consumers, adding more languages is not necessarily a good idea. Going after certain countries that represent only a very small proportion of the overall inbound UK market is simply too expensive for the returns this market will generate, and therefore a good commercial decision to leave them out.

It is most likely for that reason that you don’t get to see Expedia, Hotels.com, LastMinute etc. featuring in the Greek search results of Google above… It is too expensive to build Expedia in Greek and their commercial model is nowhere near as attractive to local wannabe OTAs as that of Bookings who seem to thrive over there not only through XML feeds to smaller operators, but also directly, on their own two feet.

So what is one to do?

Some markets are – I would argue – no-brainers! With a third of all international travel to London coming from France, Germany, Spain and Italy, and (statistically speaking) with only a fraction of the hotels in your competitive set offering rooms to these countries through their own websites, there is a huge internationalisation opportunity that should generate some real results.

Whatever your country, do talk to us. BABEL Multilingual is of the risk-free variety and I certainly believe in it. The nature of building and maintaining international presence against the OTAs doesn’t have to be alienating or difficult. We think it is completely worth it.

Thank you for reading – as always we are completely open, interested and grateful for any feedback you may have.

Yannis Anastasakis
Director

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Filed under Cultural Optimisation, eCommerce, International, Marketing, Multilingual, Pay Per Click, Return On Investment, Sales Strategies, Search Engine Optimisation