Executive Summary Methodology and Participants Rich Media / Merchandising Features & Effectiveness... 9
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2 Contents Executive Summary... 3 Methodology and Participants... 5 Rich Media / Merchandising Features & Effectiveness... 9 Social Media-Based Features & Effectiveness Combined Features Deployed, Planned & Effective Conclusions Join the Conversation About VFM Leonardo References Appendix
3 Executive Summary We are pleased to present the results of the first VFM Leonardo Hotel E-Business Survey In this quantitative study, ten key questions were asked to identify and analyze the features hotel e- business professionals find most useful and to provide quantitative findings to help other e-business professionals create ideal visual merchandising experiences to improve conversions. The VFM Leonardo Hotel E-Business Survey 2010 was conducted from March 1, 2010 through April 30, The key goals of the survey were to identify and analyze what hotel e-business professionals are currently doing and what they plan to do in the next year to enhance the online presence of their hotel(s), the travel shopper experience and drive conversions. The results were compiled based on responses from 590 companies across the world representing hotel interests and e-business responsibilities. The study was structured based on an Adobe Scene Survey Customer Experience in the New Decade conducted in February 2010 for the same relative time period. The Adobe study focused on a broad cross section of industries that have high levels of e-commerce activity associated with their business. Respondents to the Adobe study represented interactive agencies, computer hardware/software vendors, media companies and retailers. Interestingly, the travel industry was not represented in this particular Adobe study. Given that travel represents 35 to 40% of total online retail revenue 1, we wanted to explore why there was a lack of response. Is the travel industry being behind the times in e-commerce strategies? Consistent with the results of the Adobe study, our survey results reveal that the most effective customer experience and conversion tools are a combination of rich media/merchandising tactics and social media-based tactics. Specifically, the marriage of rich visual content like videos and visual hotel tours (with spin, zoom imagery, etc.) with user generated reviews, ratings and rankings. Yet, over the next 12 months, most respondents plan to deploy tactics that they admittedly do not find as effective. 3
4 Highlights from the survey include the most popular planned and deployed features and their effectiveness across two categories: rich media/merchandising and social media. The top three of five features deployed are more heavily rooted in the social media-based category. These include, branded social community pages, e.g., Facebook, MySpace, Twitter (71%), user ratings and rankings (65%), user comments and reviews (63%), videos for merchandising, advertising and demonstration (56%), and hotel tours, e.g., combinations of guided spin, zoom imagery, videos and animation (43%). The top planned features for the next year are the same top five activities as those already deployed. User comments and reviews (61%) is the number one feature planned for next year followed by videos for merchandising, advertising and demonstration (60%), branded social community pages, e.g., Facebook, MySpace, Twitter (55%), user ratings and rankings (55%), and hotel tours, e.g., combinations of guided spin, zoom imagery, videos and animation (47%). The most effective features are each rated very effective by over 60% of respondents. User ratings and rankings (67%) is followed by hotel tours (66%), user comments and reviews (64%) and videos for merchandising, advertising and demonstration (60%). This analysis of e-business professionals merchandising tactics offers valuable insights for online hotel merchandising and validates current online trends. Importantly, the results, across the board indicate that e-business professionals with rich media in their online merchandising strategies are finding great success. More details are revealed in the following pages. 4
5 Methodology and Participants Companies The majority of the survey respondents representing 68% of the total were from hotel properties either directly (64%) or though Management companies (4%) while less than 20% of the respondents were from Chains, global brands (15%) and representation companies (3%) combined. 70% 60% 50% 40% 30% 20% 10% 0% 5
6 Primary Job Functions Of the respondents, 30% were primarily responsible for general management. The majority of the respondents (42%) were primarily responsible for marketing: ebusiness/marketing activities (27%) and electronic and traditional marketing (15%). More respondents were focused primarily on electronic marketing than electronic AND traditional marketing. 35% 30% 25% 20% 15% 10% 5% 0% 6
7 Annual Sales 85% of respondents were from companies with less than $50 million in annual sales: 60% were from companies with under $10 million and 25% between $10 and $50 million annually. This is consistent with the respondents from the Adobe study. 70% 60% 50% 40% 30% 20% 10% 0% Less than $10 million $10 million to $50 million Greater than $100 million $51 million to $100 million 7
8 Regions The majority of respondents were from companies headquartered in the Americas (60%), primarily North America (54%), followed by Europe, the Middle East and Africa (34%) and Asia Pacific (7%). 60% 50% 40% 30% 20% 10% 0% North America Western Europe Middle East and Africa Eastern Europe Asia Pacific Latin America 8
9 Rich Media / Merchandising Features & Effectiveness Which rich media/merchandising features do you currently use or plan to use over the next year? What is the actual or expected effectiveness? The survey identifies the most popular rich media and merchandising features either deployed or planned for the coming year, along with the effectiveness of each feature. Rich Media/Merchandising Features Very Effective Planned Deployed Visual filtering 3D visualization Podcasts or live video feeds Zoom features Audio Quick looks and roll overs Interactive design tools Animation Room comparisons Microsites Lifestyle imagery Interactive brochures Search landing pages 360 degree spins/panoramas Dynamic displays Hotel tours Videos 0% 10% 20% 30% 40% 50% 60% 70% 9
10 Top Deployed More than half of all respondents have deployed videos for merchandising, advertising and demonstration. About one third of all respondents have deployed hotel tours, dynamic displays, 360 degree spin/panoramas and one quarter have deployed search landing pages and interactive brochures. Between one tenth and two fifths of all respondents have deployed features such as lifestyle imagery, microsites, room comparisons, animation, interactive design tools, quick looks and roll overs. Top deployed ratings: Videos for merchandising and advertising: 56% Hotel tours (combinations guided spin, zoom imagery, videos or animation with copy: 42% Dynamic displays (banner, carousel, tabbed, grid views): 38% 360 degree spin/panoramas: 33% Search landing pages: 30% Rich Media/Merchandising Features - Top Deployed 60% 50% 40% 30% 20% 10% 0% 10
11 Top Planned Between two thirds and three fifths of respondents plan to invest in the following features over the next twelve months: videos for merchandising and advertising, hotel tours, 360 degree spin/panoramas, lifestyle imagery, and interactive brochures. Compared with the rich media/merchandising features currently deployed, a number of features appear to be gaining traction for the year ahead: lifestyle imagery (deployed: 20% planned: 31%), room comparisons (deployed: 18% planned: 27%), 3D visualization (deployed: 4% planned: 18%). Top planned ratings: Videos for merchandising and advertising: 60% Hotel tours (combinations guided spin, zoom imagery, videos or animation with copy: 47% 360 degree spin/panoramic: 42% Lifestyle imagery: 31% Interactive brochures: 28% Rich Media/Merchandising Features - Top Planned 70% 60% 50% 40% 30% 20% 10% 0% 11
12 Top Effective Respondents that have deployed or plan to deploy these rich media/merchandising features rated video for merchandising and advertising as most effective feature. 89% of respondents find video effective (very effective: 60%, somewhat effective: 29%). It is a wonder why more hotels do not have video as part of their online marketing strategy. Over two-thirds rated multi-media viewing (360 degree spins/panoramas, hotel tours, zoom features, dynamic displays) as the most effective. Top very effective ratings: Hotel tours (combinations guided spin, zoom imagery, videos or animation with copy: 66% Videos for merchandising and advertising: 62% 360 degree spin/panoramic: 47% Search landing pages: 36% Lifestyle imagery: 34% Interactive brochures: 34% Rich Media/Merchandising Effectiveness Top Very Effective 70% 60% 50% 40% 30% 20% 10% 0% 12
13 Social Media-Based Features & Effectiveness Which social media-based features do you currently use or plan to offer over the next year? What is the actual or expected effectiveness? This survey included social media-based features to identify the most popular features either deployed or planned for the coming year, along with the effectiveness of each feature. Social Media-Based Features Very Effective Planned Deployed Wikis Desktop widgets Mashups Live chat/instant messaging Syndicating visual content to social sites Blogs or micro-blogs RSS feeds URL and web widget viral sharing User-generated visual content User ratings & rankings User comments & reviews Branded social communities 0% 10% 20% 30% 40% 50% 60% 70% 80% 13
14 Top Deployed Over two thirds of all respondents have deployed branded social community pages (Facebook, MySpace, Twitter) and user ratings and rankings, followed by user comments and reviews, user generated visual content, URL and web widget viral sharing. Top deployed ratings: Branded social community pages: 70% User ratings and rankings: 65% User comments and reviews: 63% User generated visual content: 28% URL and web widget viral sharing (embedded on other sites, blogs, etc.): 26% Social Media-Based Features Top Deployed 80% 70% 60% 50% 40% 30% 20% 10% 0% Branded social communities User comments & reviews User ratings & rankings User-generated visual content URL and web widget viral sharing 14
15 Top Planned Over half of all respondents plan to add user comments and reviews, branded social communities (Facebook, MySpace, Twitter) and user ratings and rankings. Consistent with social media-based features already deployed, fewer respondents plan to deploy RSS, URL and web widget viral sharing, wikis, desktop widgets, live chat, and mashups. The biggest increases in activities planned vs. already deployed include user generated visual content, blogs or micro blogs, and syndicating visual content to social sites (YouTube, Exploroo, etc.). Top planned ratings: User comments and reviews: 61% Branded social community (Facebook, etc.): 55% User ratings and rankings: 55% User-generated visual content (images, video, audio): 43% Blogs or micro blogs: 34% Syndicating visual content to social sites (YouTube, Exploroo, etc.): 34% Social Media Based Features Top Planned 70% 60% 50% 40% 30% 20% 10% 0% 15
16 Top Effective Respondents that have deployed or plan to deploy these social media-based features rated user comments and reviews and user ratings and rankings most effective. 96% of respondents find user comments and reviews effective (very effective: 64%, somewhat effective: 32%) followed closely by user ratings and rankings at 94% (very effective: 67%, somewhat effective: 27%). This is not surprising given the popularity of TripAdvisor and similar travel review sites. Top very effective ratings: User ratings and rankings: 67% User comments and reviews: 65% User generated visual content (images, video, audio): 44% Branded social community (Facebook, MySpace, Twitter, etc.): 40% Syndicating visual content to social sites: 23% Blogs or micro-blogs: 21% Social Media-Based Effectiveness Top Very Effective 80% 70% 60% 50% 40% 30% 20% 10% 0% 16
17 Combined Features Deployed, Planned & Effective The following charts illustrate the top deployed, planned and very effective features across the two areas analyzed: rich media/merchandising and social media-based. Very Effective Planned Deployed Wikis Desktop widgets Visual filtering 3D visualization Mashups Live chat/instant messaging Podcasts or live video feeds Zoom features Audio Quick looks and roll overs Interactive design tools Animation Syndicating visual content to social sites Blogs or micro-blogs Room comparisons RSS feeds Microsites Lifestyle imagery Interactive brochures URL and web widget viral sharing User-generated visual content Search landing pages 360 degree spins/panoramas Dynamic displays Hotel tours Videos User ratings & rankings User comments & reviews Branded social communities 0% 10% 20% 30% 40% 50% 60% 70% 17
18 Top Deployed The top three of five features deployed across all customer experience tactics are rooted heavily in the social media-based category. Branded social community (Facebook, MySpace, Twitter, etc.): 69% User ratings and rankings: 63% User comments and reviews: 63% Videos for merchandising, advertising and demonstration: 57% Hotel tours (combinations guided spin, zoom imagery, videos and animation): 41% Rich Media/Merchandising & Social Media-Based Features Top Deployed 80% 70% 60% 50% 40% 30% 20% 10% 0% 18
19 Top Planned The top planned features for the next year are the same top five activities as those already deployed. User comments and reviews and videos for merchandising, advertising and demonstration are practically tied for first place on the list of top planned features for the next year. User comments and reviews: 62% Videos for merchandising, advertising and demonstration: 59% Branded social community (e.g. Facebook, MySpace, Twitter): 55% User ratings and rankings: 55% Hotel tours (combinations guided spin, zoom imagery, videos or animation): 48% Rich Media/Merchandising & Social Media-Based Features Top Planned 70% 60% 50% 40% 30% 20% 10% 0% 19
20 Top Effective Survey respondents who have either deployed or plan to deploy the following features gave them the highest ratings for very effective. The most effective tactics across all features rated very effective by more than 60% of respondents are: User ratings and rankings: 67% Hotel tours (combinations guided spin, zoom imagery, videos or animation): 66% User comments and reviews: 64% Videos for merchandising, advertising and demonstration: 60% Between one third and two fifths of respondents also ranked three other features across all features very effective: 360 degree spin/panoramic: 49% User generated visual content (images, video, audio): 44% Branded social community (Facebook, MySpace, Twitter, etc.): 40% Rich Media/Merchandising & Social Media-Based Features Top Very Effective 80% 70% 60% 50% 40% 30% 20% 10% 0% 20
21 Conclusions Consistent with the findings in the Adobe Scene Survey: Customer Experience in the New Decade study, the combination of user reviews and ratings and rich visual content is the most effective mix of features. Interestingly, another study by Adobe entitled, Adobe Scene7 Viewer Study: What Shoppers Want, found that this combination is also the ideal experience for online consumers. Combining robust imagery with customer reviews/comments has shown to be the ultimate, preferred experience. 2 This study has confirmed what we have discovered from supplemental research: travel shoppers want rich visual experiences and to hear your hotel s story both from you and from other guests. Hotel e-business professionals that meet consumer demands by using this combination of features in their online strategies will find the greatest success. However, there is a disconnect between the features that e-business professionals believe to be the most effective and the features they are currently using and/or plan to use. In other words, the features that many e- business professionals are currently using do not align with those that they believe to be most effective. For example: 38% believe lifestyle imagery is very effective yet only 19% have deployed this tactic. 48% believe 360 degree spin/panoramas are very effective yet only 32% have deployed this tactic. 64% believe hotel tours (combinations of guided spin, zoom imagery, videos or animation) are very effective yet only 41% have deployed this tactic. 39% believe branded social communities are very effective yet 69% have deployed this tactic. This reveals that e-business professionals and perhaps the industry as a whole needs to reset their thinking. Rather than focusing their time on the features that are easiest to implement, they need to focus on the features that are most effective. User ratings & rankings Hotel tours (combinations of guided spin, zoom imagery, videos or animation) User comments and reviews Videos for merchandising and advertising 360 degree spins/panoramas During a webinar we hosted recently Using Video to Engage and Interact with Online Travel Shoppers we conducted a poll to find out what the number one barrier that is preventing hotels from adding video to their online marketing strategies. We were surprised to find that developing video content (cost, choosing a vendor, content) is the number one barrier for 74% of the hoteliers in attendance. 3 This is indicative of an overall perception that multimedia features like video and hotel tours are perceived as being difficult to develop and deploy. In actuality, none of the five most effective strategies revealed in this study (listed above) are difficult to execute. Like anything, they require work and focus but most e-business professionals already have the skills required to develop and deploy these features. Through analysis of this study, one can conclude that for many hotel e-business professionals there is an opportunity to shift focus and begin deploying the features that are most effective and sought by online travel shoppers. Travel shoppers do extensive research online, but to make a purchase decision they need adequate content that increases their confidence that they are choosing the right hotel for their trip. The leaders in hotel e-business who leverage the most effective features and deliver the optimal experiences to online travel shoppers, will ultimately increase their conversions. 21
22 Join the Conversation We hope that your find this research useful. We welcome comments, questions and feedback. Please post your comments to our blog at blog.vfmleonardo.com or them to Follow us on Twitter About VFM Leonardo VFM Leonardo is a technology leader in online visual content management and syndication for the hotel industry. VFM Leonardo's VScape and VBrochure products leverage the syndication capabilities of the VNetwork, the most universally accepted and largest online visual content syndication network for the global travel industry. VFM Leonardo offers the most effective digital asset management and online merchandising systems available today with over 1,000,000 visual images (photos, virtual tours and videos) for 90,000 hotels worldwide currently in distribution across the VNetwork. All four global distribution systems (GDSs) - Amadeus, Galileo, Sabre, Worldspan - as well as Pegasus source hotel visual content through VScape. Tens of thousands of travel-related channels including online travel agencies, travel research and supplier web sites, search portals; Travelocity, Orbitz, Priceline, Tripadvisor, Yahoo! Travel, Kayak, Google and more also source visual content through VScape. For more information about VFM Leonardo, visit Follow us on Twitter References 1. Deloitte Consulting, Hospitality Adobe Scene7 Viewer Study: What Shoppers Want, January VFM Leonardo Webinar, Using Video to Engage and Interact with Online Travel Shoppers, June 24,
23 Appendix 1. What is your company's primary segment in the hotel industry? Value Percent Hotel Property 65% Chain (Brand) 15% Other 8% Consultant/Advisory/Supplier 5% Chain (Representation Company) 3% Management Company 3% 2. What is your primary function in your company? Value Percent General management 30% ebusiness/marketing activities 27% Marketing (electronic & traditional) 15% Revenue management 12% Other 8% Relationships with GDSs 5% Multimedia production 3% 3. What is your company's annual sales volume? Value Percent Less than $10 million 60% $10 million to $50 million 25% Greater than $100 million 8% $51 million to $100 million 7% 4. Where is your company headquartered? Value Percent North America 53% Western Europe 15% Middle East and Africa 10% Eastern Europe 8% Asia Pacific 7% Latin America 7% 23
24 5. Which Rich Media/Merchandising Features do you currently use? Value Percent Videos for merchandising, advertising and demonstration 57% Hotel tours (combinations guided spin, zoom imagery, videos or animation with copy) 41% Dynamic displays 37% 360 degree spins/panoramas 33% Search landing pages 30% Interactive brochures 24% Lifestyle imagery 20% Microsites 20% Room comparisons 17% Animation 13% Interactive design tools 11% Quick looks and roll overs 11% Audio 9% Zoom features 9% Podcasts or live video feeds 7% 3D visualization 4% Visual filtering 4% 6. Which Rich Media/Merchandising Features do you plan to use over the next year? Value Percent Videos for merchandising, advertising and demonstration 59% Hotel tours (combinations guided spin, zoom imagery, videos or animation with copy) 48% 360 degree spins/panoramas 43% Lifestyle imagery 30% Interactive brochures 28% Search landing pages 28% Dynamic displays (banner, carousel, tabbed, grid views) 26% Room comparisons 26% Audio 20% Interactive design tools 20% Microsites 20% 3D visualization 17% Animation 17% Podcasts or live video feeds 15% Quick looks and roll overs 15% Zoom features 11% Visual filtering 7% 24
25 7. What is your belief on the actual or expected effectiveness of the following Rich Media/Merchandising Features? Item Very Effective Somew hat Effective Not Effective Hotel tours (combinations guided spin, zoom imagery, videos or 66% 17% 6% 11% animation with copy) Videos for merchandising, advertising and demonstration 60% 29% 4% 6% 360 degree spins/panoramas 49% 31% 9% 11% Search landing pages 40% 33% 12% 16% Lifestyle imagery 38% 38% 7% 17% Interactive brochures 36% 39% 7% 18% Microsites 33% 28% 14% 26% Room comparisons 33% 40% 7% 21% 3D visualization 31% 26% 12% 31% Interactive design tools 29% 32% 7% 32% Dynamic displays (banner, carousel, tabbed, grid views) 24% 57% 7% 13% Audio 21% 35% 26% 19% Podcasts or live video feed 20% 33% 18% 29% Quick looks and roll overs 20% 39% 7% 34% Zoom features 19% 47% 14% 21% Visual filtering 12% 37% 7% 44% Animation 10% 49% 15% 26% 8. Which social media based features do you currently use? Value Percent Branded social communities (e.g. Facebook, MySpace, Twitter) 69% User comments & reviews 63% User ratings & rankings 63% User-generated visual content (images, video, audio) 27% URL and web widget viral sharing (embedded on other sites, blogs, etc.) 25% RSS feeds 19% Blogs or micro-blogs 17% Syndicating visual content to social sites (YouTube, Exploroo, WAYn, etc.) 15% Live chat/instant messaging 6% Mashups 6% Desktop widgets 4% Wikis 4% Not Sure 25
26 9. Which social media features do you plan to use over the next year? Value Percent User comments & reviews 62% Branded social communities (e.g. Facebook, MySpace, Twitter) 53% User ratings & rankings 53% User-generated visual content (images, video, audio) 42% Blogs or micro-blogs 33% Syndicating visual content to social sites (YouTube, Exploroo, WAYn, etc.) 33% RSS feeds 29% URL and web widget viral sharing (embedded on other sites, blogs, etc.) 27% Wikis 20% Desktop widgets 18% Live chat/instant messaging 18% Mashups 13% 10. What is your belief on the actual or expected effectiveness of the following social media based features? Item Very Somewha Not Not Sure Effective t Effective Effective User ratings & rankings 67% 27% 2% 4% User comments and reviews 64% 32% 2% 2% User-generated visual content (images, video, audio) 44% 32% 2% 22% Branded social communities (e.g. Facebook, MySpace, 39% 41% 4% 15% Twitter) Syndicating visual content to social sites (YouTube, 23% 47% 7% 23% Exploroo, WAYn, etc.) Blogs or micro-blogs 21% 54% 5% 21% URL and web widget viral sharing (embedded on other 21% 37% 12% 30% sites, blogs, etc.) Live chat/instant messaging 19% 24% 21% 36% RSS 17% 38% 5% 41% Mashups 13% 26% 10% 51% Desktop widgets 10% 39% 5% 46% Wikis 10% 28% 15% 48% 26
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