Hraba Hospitality Consulting

This is a really big question. I would love to see the industry really delve into this.  The transition from real world to online has been very fast, and a lot of the “infrastructure” is so much e-duct tape, putty, and last minute jury rigs – all of which should have meant to be temporary so that we can rebuild our online world of distribution based off tried and true methods, as they evolve.  I know our industry is never that pro-active, but maybe we have an opportunity to start learning from where we are losing the most money, and patch those leaks.

This Argophilia post by Phillip Butler starts the conversation: Who is the big bad wolf of hotel marketing?  Simply put, there isn’t just one –  OTA’s, Franchise Fees, Internet Marketing Fees, Booking Engine Fees.  This is one leaky ship.

Here is my response, but I am more interested in what all of you have to say?
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Great read. Thank you much. =)

I always thought of the OTA’s as something that filled the gap during the off line to online distribution evolution. They were a stopgap solution. They are now becoming unnecessary, and getting in the way of commerce because they are becoming obsolete, where they used to promote some level of commerce for our industry. Distribution has changed… and their role will phase out. It won’t be in the next 5, maybe 10…. but this will all change. I adore how people revile when you suggest the guy on top won’t be there forever.  The fact is, nothing is forever, and new paradigms unfold.

Another big bad wolf, on top of franchise fees? Ridiculous internet consulting firm charges by hourly consulting model.  Buuteeq is doing some good with simple pricing plans… it makes a lot more sense, and you aren’t nickel and dimed for the internet marketing group’s mistakes or on the job training.

Lastly…. commissions to booking engines. Including the franchise fees, as well… Engines like Synexis get promoted by franchise and flag brands, which then take a cut. It’s incredible how much money is lost to an engine that simply helps facilitate online booking. Eventually, the hotels will realize the money lost can be recouped quickly by building and designing a proprietary engine of your own, off a template, for the hotel to own, outright. That can save 20K – 100K+ a year.  I imagine a management group could justify the development fees to an owner group, based solely off the last 3 years of annual or commissionable fees that the property made to the booking engine company.

Would anyone have any idea how much it would cost for development of a competent template, and simple engine with solid UI – that includes a mobile component? Is that $100k or more?  I know… you can always spend more. =)

Brands on Facebook are nothing more than dissonance now.  Whereas before they were meaningless, and the pages were little more than non-functional, limiting, and fairly non-interactive static places….

….now they are annoying, interruptive, and totally dysfunctional.  The new layout for Facebook has turned personal conversations into nothing more than reality TV with advertisements at random intervals. Brands and Pages used to be benign, and it was obvious there weren’t *doing* much of anything.  But now people look at these pages as malicious marketing that is getting in the way of their social network.  The furor I have seen is remarkable, but I hadn’t experienced it until  (more…)

There is something fairly revelatory about my mother’s new purchase… a Lexus “this is not an SUV” SUV hatchback.  I have zero green commentary, I have zero bourgeois commentary… I have nothing negative to say guys… calm down.  It is a practical car for her needs, the “endless errand running”-”take too much on” go-getter.  That is fine.

What is interesting is that she has owned multiple mercedes’ since her 1990 economy purchase of a Honda Accord.

I don’t think this says anything about Lexus per se… possibly that their online brand was strong.  But what really shook me was that my mom, a NON web 2.0/user generated content/ social media woman actually turned to the net to resolve her ongoing problem with Mercedes.

SO… here is the story of a non web 2.0 user and how she actually used web 2.0:

She first researched her Mercedes dealer and noted the results were incredibly poor.  She then researched her new Lexus dealer, and found striking and positive comments.

(When I say “research”, I mean typing specific, exact keywords in google; then perusing the different sites that popped up, namely Yelp).

She would look through the comments…. recognizing that some people were just extreme, ignorant, bad mouthing, or unhappy.  She actually knew to mentally cull the wheat from the chaff as a matter of unconscious habit.  This is sometimes suggested as a dent in the social review model, in that casual users don’t “get” to filter reviews, so I found it of interest she casually mentioned she was ignoring bad reviews.

She then found a number of places through that same manner, grouped them all together…. and had them directly bid for her business on the exact model she wanted.

I know this sounds deliberate and literal, but these habits are constantly questioned… so I thought I would throw it out there.  It is utterly simplistic, and not a real case study, to be sure….. derrrrrrrrr.

But it is amazing how social media and user generated review sites are becoming relevant even to the completely passive internet users.

Also, not only that it creates an outlet for unhappy clients… but, what’s more, it offers a place for clients to get massive amounts of research and real “case studies” before buying.  Very simplifying for the consumer, and very empowering.

For the strong, pervasive, talented brands as well…. it is an amazing opportunity to have that one to one direct marketing ability… and I mean DIRECT, at your disposal.

As for the weaker brands, don’t pay attention.  Trust me.  It’s scary.  Sorry Mercedes.

[WARNING:  DISGUSTING CYNICISM AHEAD.  I JUST TALK ABOUT IT TO MAKE IT AS TRANSPARENT AS POSSIBLE]

It might be the most important marketing tool in the history of business.  This is what I would like to talk about.  I bailed on facebook a couple months ago as demonstrated here:

http://www.yelp.com/topic/san-francisco-i-just-deleted-my-facebook-account#uGX2fLe0NIteKu_XQVWZhg

http://www.yelp.com/topic/san-francisco-is-facebook-beacon-evil#-NineORULvGb3hM778Ltdg

Well now I need to do it for a couple reasons… one is that it may be killing email.  For real.

http://memebox.com/futureblogger/show/674

http://mashable.com/2007/08/20/facebook-email/

So that is one reason.

But another is because I need to *understand* this thing from a business end.  It is quite rapidly changing so much of business and marketing.

SO…. here I dive deep back into the fray.  I have a couple accounts… one that is for experimenting, one that is me, and one that is a business account.  Here are some things I have noted within the first couple days:

People will friend you because you are a friend of a friend.  This is interesting.  The larger the networks, the better the advertising possibility.  If you could successfully get the contact list of a successful facebooker, the leverage there would be astonishing.  I assume, at some point, you will hear of facebookers selling their contact list to a corporation.  Very unethical, very under the table, and it might have already happened.  Think about the Obama page.

Speaking of Obama, Facebook groups as well as the newer facebook pages are INCREDIBLE.  The marketing potential behind those are epic, and get into a philisophical conversation (more on that soon). I note that many hotels or groups have pages and groups on facebook.  Both are incredible, because it offers an opportunity to directly connect to consumers who *WANT* to be branded.

It is astonishing the level of transparency in regards to consumers… the fact is that advertising is almost expected and welcomed as long as it is witty, impacting, and earnest with its effectiveness while being self aware.  But this leads to a remarkable issue.

Marketing took this default position in the past as creating a rift… or as marketers like to say “need”.  The idea was to create this imperative need in someone, so much so that they might feel less human or capable of competing in their social circle without said product.  Whether it is targeted at the insecurity of growing old, or filling our technolust driven by the marketing machine….  marketing was dehumanizing and robbed people of self worth.  I strongly believe this to this day, but now things are changing.  I am not saying that it grants reprieve to the cynicism embedded in any job that starts with “here… convince people they want this”, but I am saying that it has flip flopped.

The individual is only defined by the brands it wears on its social page.  People define themselves with branding and marketing.  People squirm in their own skin and rejoice at the opportunity to wear Dior, or Persol, or Chanel.  People are voracious to prove they are cool with buttons, patches, labels, logos, and advertising.  Even if it is some modern pop culture subgroup like hipsters or burners, they wear their anti-brand as a brand.  It gets co-opted to a significant degree.  There is a moment you cannot tell if you are talking to someone who started a trend in response to the dehumanizing consumerism, or if they are the response to the marketing trends of consumerism co-opting an explicitly regurgitating this trend.  It has happened with jazz vipers, hippies, punks, and so on.

The startling issue is that the majority of consumers are no longer passively accepting marketing like a car whizzing past a route 66 staggered billboard  ad campaign

The aspect of modern marketing being that consumers are endorsers for your product or brand… WILLINGLY wearing this as if it were an emblem on their clothing.  The Generation Z kids are not only “me me me”, but they are quite willing to leverage their “individuality” for the opportunity to be memetic “endorsers” of products and brands.  Think about that….

The facebook user becomes nothing more than an empty vessel to fill with your marketing efforts.  There is a certain point that the user is solely defined by their brand loyalty that they constantly advertise.  Whether they review a restaurant on yelp, buy something on Amazon, listen to something on Pandora, etc….

It is fascinating, and incredibly important.  In university, my degree in communication went into the idea that information is somewhat autonomous, and the information is the meme, while the human body simply a vessel to transmit these memes.

Think of that…. that information is what is truly alive.  In this sense, brands are what are memetic.  In fact everything is a brand… your name, your facebook or yelp account.  It all ends up representing you and reflecting on you… and people carry this brand image of who *you* are with them.  But what astonished me is that this ethereal, subjective theory could be viable.  I just thought it was something chatted up in dimly lit rooms at 3am over a smoky haze of forced intellectualism.

If facebook (as well as the users themselves through passive acceptance) turns users into “endorsers” or walking billboards (http://www.linkedin.com/answers/marketing-sales/advertising-promotion/advertising/MAR_ADP_ADV/126511-10096762?goback=.ahp), it will be an interesting commentary on what creates our individualism. Are we willfully decieving ourselves into thinking, antithetical to Fugazi’s “You are not what you own” line, what brands we consume is what defines our individuality?

Or is it too late?

We will be happy and focused on the 10 people we know and are happy vacation photos, while all this meta-marketing and meta-advertising is loosely orchestrated in a way that we aren’t even paying attention to.  We will live and die, our facebook profiles will go dormant…

But in 10,000 years, someone might purchase something at Nordstrom’s due to your review.  Or possibly buy Chanel sunglasses because on your spring break you looked… oh…….so…. chic.

Shit Bill Hicks was right.