The reliability of user–generated hotel reviews

If online review sites were both unreliable and mistrusted, they would quickly become irrelevant. Even if online review sites were trusted by consumers but were significantly unreliable, they would not provide any value to customers and would quickly lose their audience. A new study shows now that neither is the case.

As online reviews have grown in popularity, attacks regarding their authenticity and trustworthiness have increased. TripAdvisor, the leading online review site for hotels, has been criticized for allowing reviews to be posted by anyone about any hotel, without needing supporting evidence. In an attempt to evaluate the legitimacy of these concerns, we compared results from TripAdvisor reviews with the Market Metrix Hospitality Index (MMHI), a well known hotel customer satisfaction panel in operation since 2001. Customer evaluations for 67 hotels were directly compared using TripAdvisor and MMHI data for 12 months. The results indicated that these sources provide consistent results by property although more variability was identified in the TripAdvisor reviews. This study should help address questions raised about the credibility of user–generated reviews and review sites.

Several years ago TripAdvisor partnered with Market Metrix to create a customer satisfaction scoreboard designed for the needs of hotel managers. The key metric used is the Customer Satisfaction Index (CSI), which is a new score that rates each TripAdvisor review from 0–100 based on 7 questions from the TripAdvisor survey. The CSI score makes it easy to compare results to local benchmark sets and determine which reviews require immediate action. Different from TripAdvisor's Popularity Index, the CSI score allows reviews to be compared to any competitors and trended over time. A satisfaction scoreboard for each hotel is displayed on the property's hotel manager page on TripAdvisor.com. For this research study the CSI score was the metric used for TripAdvisor Reviews.

The hotels used in this comparison were selected on the basis of their location, brand and type to achieve a diverse mix. Each hotel also must have received a sufficient number of responses. Statistical analysis was conducted to compare the similarity of scores for each hotel, the distribution of the data, and the change in scores.

The most significant conclusion of this study is that the mean scores of hotels track very consistently and closely between TripAdvisor (CSI) and MMHI. This indicates that, when taken as a whole, the reviews for a particular hotel are a reliable measure of average customer satisfaction of that hotel, given adequate sample size. However, the variability of scores was found to be slightly greater among TripAdvisor hotels. TripAdvisor reviews were more spread out with more high scores and more low scores. While some persons may appreciate reading a wider range of reviews about a hotel, extreme observations may be distracting or even distort consumer perception.

Why would TripAdvisor CSI Scores have higher variance than MMHI? Differences in survey methodology (number of questions, scoring, and sample selection) all play a role in differences in variance between these two sources. The fact that TripAdvisor surveys come from customers who are not part of a sample–controlled panel but are motivated by many different experiential and psychographic factors could be a source of variance. For example, it is logical that individuals who have had either an exceptionally good or bad experience would be more inclined to post a review, but individuals across the satisfaction scale would likely participate in a sample–controlled panel study. This would lead to higher variance among TripAdvisor reviews.

If online review sites were both unreliable and mistrusted, they would quickly become irrelevant. Even if online review sites were trusted by consumers but were significantly unreliable, they would not provide any value to customers and would quickly lose their audience. Our findings show that neither is the case. Review sites are gaining in popularity as customers are clamoring for more peer–to–peer support.

Consumers, in general, trust established review sites. And at least TripAdvisor, based on this study, is a reliable source for obtaining customer satisfaction information of a given hotel. Therefore, UGC will increasingly reduce the impact of traditional marketing and sales efforts and add value to strategies that will increase the customer experience and ultimately the scores of hotel reviews.

Related Link: Market Metrix

Editor: Cristian Segura writes articles related with technology, social media and marketing. Sponsored by Costa Rica Hotels, Motor de reservas en lineaandTravel to Costa Rica

Why hotels shouldn’t sell a $200 hotel room for $50

Rather than abet Expedia in its drive to become a traveler’s supplier of choice, it might be wiser to gamble that hotels’ own channels can achieve more than one sixteenth of what Expedia/Groupon could produce.

Tom Walker, TERADATA

Tnooz’s June 22 article “Expedia: What Groupon Getaways with Expedia means for hotels,” (why a hotel should sell a $200 hotel room for $50) posits an interesting case. But does it withstand a closer look?

To make the argument, Jennifer Mellet, Expedia’s senior director of new channel sales, presents the following hypotheticals.

$100: What the customer pays
$ 50: What the hotel receives
$ 40: Cost per occupied room (CPOR)
$ 10: Net to the hotel

Assuming 1,000 people buy the offer, the hotel nets $10,000.

Ms. Mellet further claims that “those are 1,000 largely incremental room nights that would have otherwise gone unsold.” No doubt some of the business would be incremental, but how much is really an unknown. It is also true that some cannibalization would occur, which again is an unknown.

At a gross level of analysis, $200 is four times the $50 that might otherwise be sold. On the margin, however (using the article’s $40 CPOR), the Expedia/Groupon deal is sixteen times less than what the $200 sale is worth:

$200 - $40 = $160. 160/10 = 16.

Is it realistic to believe that the Expedia/Groupon offer will deliver sixteen times more sales than the hotel would realize without running the special? Anything is possible, but as a hotelier I would be more than a little skeptical.

To further strengthen her case, Ms. Mellet points out that:

- In fact, Groupon customers have been shown to spend as much as 60 to 80 percent on top of the value of the Groupon.

Illustration continued:

- Cross-sell revenue per room (70% on top of $100 voucher at 70% margin to hotel): $49

- Total margin generated if 1,000 vouchers are sold: $59,000.

But is there any reason to believe that Groupon customers are more likely than other customers to spend additionally once staying in the hotel? Perhaps, but the proposition is far from self evident. If the hotel sells one sixteenth of the rooms at $200 that Expedia/Groupon would sell, it would achieve equivalent profitability. And the customer would be the hotel’s, not Expedia’s.

There is a pitched battle today between OTAs and hotels over which of them “owns” the customer. Expedia is aggressively positioning itself to be the owner of what might otherwise be hotels’ customers. Unquestionably, Expedia and other OTAs provide hotels a valuable service, but that value is delivered at a comparatively high price.

Rather than abet Expedia in its drive to become a traveler’s supplier of choice, it might be wiser to gamble that hotels’ own channels can achieve more than one sixteenth of what Expedia/Groupon could produce. In the bargain, hotels retain their loyalty position with the customer, which represent a value far greater than the $10 Expedia/Groupon might deliver.

Tom Walker is Senior Industry Consultant at TERADATA

Read also "Expedia on why you should give away a $200 room for $50"

Editor: Cristian Segura writes articles related with technology, social media and marketing. Sponsored by Costa Rica Hotels, Motor de reservas en linea andTravel to Costa Rica

Google no permitirá los perfiles de usuario privados

Todos los perfiles de usuario de Google serán públicos a partir del próximo 31 de julio. Según la compañía, la decisión «ayudará a que te encuentren y se pongan en contacto contigo».

Para Google, el objetivo de los perfiles es «fortalecer la identidad on-line» para lograr que sus distintos servicios resulten más útiles. Hasta ahora, los perfiles privados permiten decidir al usuario si hacer visibles o no sus datos personales.

Sin embargo, el buscador cambiará las condiciones de uso y exigirá que el nombre completo y el género sean públicos. El resto de información dependerá de la configuración que realice el usuario en su perfil.

Para las personas que cuenten con un perfil privado y no desee hacerlo público, Google se muestra contundente, «podrá eliminarlo o simplemente no hacer nada. Todos los perfiles privados se eliminarán a partir del 31 de julio».

Editor: Cristian Segura writes articles related with technology, social media and marketing. Sponsored by Costa Rica Hotels, Motor de reservas en linea and Travel to Costa Rica

Five critical trends hotel marketers need to know

There is no doubt that user-generated content and the Social Web have sent ripples through our industry, causing us to re-look at the way we approach online hotel marketing. This article outlines five key trends in hospitality that hotel marketers should be aware of as they approach online reputation management. by Paolo Torchio of Sabre Hospitality Solutions


There is no doubt that user-generated content and the Social Web have sent ripples through our industry, causing us to re-look at the way we approach online hotel marketing. When sites like TripAdvisor first grew in popularity, we found ourselves taking a reactive approach: how can we be sure that our reputations are not damaged by negative reviews? Today’s trends show that this content is not only here to stay but also growing, and hotel marketers have the opportunity to use this to their advantage. Below, Paolo Torchio outlines five key trends in hospitality that hotel marketers should be aware of as they approach online reputation management.

Trend to know: Consumers Believe Other Consumers, Not You

75% of people don’t believe that companies tell the truth in advertisements, according to a Yankelovich study. At the same time, Nielsen research indicates that 9 out of 10 consumers believe another consumer like them more than they believe corporate messaging. For organizations used to controlling the communication people hear about them online, this can be an unpleasant awakening.

The new reality requires us to take a different approach to the way we promote our hotels. We must understand how much the customer is in control, and how we have to operate in this new reality.

Opportunity for you: Encourage your guests and supporters to act as salespeople

Use this trend to your advantage. Instead of just being limited to the salespeople within your organization, plan a way to mobilize your entire customer base to act as brand ambassadors - selling for you.

How?

Design remarkable experiences that get guests talking. Consistently deliver extraordinary service, so guests feel safe and comfortable referring their friends. And then actively encourage guests to share this experience with others online. When you’re confident in the product you deliver, this should be easy.


Trend to know: Too much online chatter causes confusion, missed opportunities

Travelers are dramatically increasing the volume of data they publish to the web – both intentionally and unintentionally. Cross-posting between social media networks and increased integration means that a single activity by one person may be posted across 10 different websites. There is a lot of chatter on the social web, and not all of it is feedback we can use if left unfiltered.

If your organization doesn’t have the right systems and procedures to gather insights, you can quickly become paralyzed by the overwhelming volume of data.

Opportunity: Use better listening and reporting tools to stay ahead of the competition

Technology can give you the advantage over competitors in this area. By using a reputation management tool such as ReviewPro, you can identify and act on opportunities that your competitors miss.

Create position-specific reporting that executives, managers, and frontline staff can use immediately in their day-to-day jobs. Insights need to be simple and there must be no confusion on what action should be taken. It should not require a “guru” to interpret. 2011 is becoming the year of the practitioner, not the guru. If we are going to make social media analysis something everyone takes part in, then we need to simplify it so non-specialists can understand the action steps needed.

Trend to know: Consumers making last-minute switches based on online reviews

The World Travel Market’s 2010 Industry Report reported that 35% of travelers change their choice of hotel after browsing social media and review sites like TripAdvisor.

People go to sites like TripAdvisor and make last-minute decisions on which hotel to choose. Online review sites affect people in the final stage of the buying cycle - just before they make a reservation. They’re already decided on the destination, the length of their trip, and now they’re ready to buy. The question is: how are you presented when people come to buy?

Your Opportunity: Give the right impression at the right time.

Make sure that the reviews people see are positive if you want to capture these bookings. How? By listening to guest feedback shared through online reviews, making changes as needed, and continually focusing on improvement.

Trend to know: Negative reviews are directly correlated with lower revenues

But while many hotels are still looking at online reviews as a threat to their reputation and are afraid of losing control over their brand, we highly encourage you to see online reviews as an opportunity. The potential of online reviews on sales becomes very clear when Jennifer Davies, senior content manager at Expedia, explains: “On Expedia.com, good reviews of 4.0 or 5.0 generate more than double the conversion of a review of 1.0 – 2.9.”

In another interview, Expedia’s VP of Supply Strategy and Analysis, Brian Ferguson, shared that a 1 point increase in a review score (on a 5-point scale) equates to a 9% increase in average daily rate (ADR). At the point we are right now with hotels struggling to recover from the global economic crisis, and with no more cost cutting options available, measures that increase conversion rates and increase ADR are critical.

Your Opportunity: Boost revenues with more positive reviews

This trend can, of course, be taken positively. By encouraging positive reviews, you can increase revenue.

Trend to know: Real-time web makes delayed responses ineffective

Social media author and thought leader David Meerman Scott opens his book Real Time Marketing and PR with an anecdote of his days working on Wall Street in 1985. It’s a scene we’ve all seen in movies: brokers fill the trading floor, casually talking and joking with colleagues until the moment when the room is alerted to a newsflash that sets the room alive into the split-second, highly organized, “Buy! Buy! Sell! Sell!” type of chaos where many fortunes have been made or lost.

“Within that minute the traders who got their orders placed a split-second faster had earned their daily bread. Being first with the news is valuable currency that earns them lucrative deals from their clients,” says Scott. “Now, it’s like we all work on Wall Street. Social media is becoming real time media, and we have to act fast to capitalize on opportunities.”

Your Opportunity: Automate engagement and response :

Real-time social media tools and a solid response program are directly connected to higher revenue and increased customer engagement. Look into adapting a set of social media tools that will work together to maximize your interactions with customers, increase your conversion opportunities across the Social Web, and notify you anytime someone mentions your hotel in social media, enabling you to respond quickly.

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Paolo Torchio is Vice President of E-Marketing and Revenue Consulting at Sabre Hospitality Solutions. Sabre Hospitality Solutions provides marketing, distribution, and technology solutions to the global hospitality industry. Sabre Hospitality Solutions recently launched SocialConversion, a suite of tools to create engagement and conversion opportunities for hotels through social media. Additionally, Sabre Hospitality has entered into an agreement with ReviewPro to offer online reputation and social media monitoring solutions to its hotels worldwide.


Editor: Cristian Segura writes articles related with technology, social media and marketing. Sponsored by Costa Rica Hotels, Motor de reservas en linea and Travel to Costa Rica

Google: con 'Me on the web' controlarás tu información personal

Google ha lanzado una herramienta 'Me on the web' (Yo en la Web) que permitirá controlar la información del usuario que se publique en Internet. Esto sólo con poseer una cuenta en el buscador. Las alertas serán enviadas por correo electrónico de forma diaria o semanalmente, una vez que el robot descubra que se ha mencionado el nombre del usuario o cuando la dirección de correo se haga pública asociándola quizás con el número de teléfono de la casa o dirección de la misma.

Esta nueva opción es ideal para eliminar información personal de los motores de búsqueda y la empresa a la vez difundirá consejos acerca de cómo protegerse en línea en cuanto a los datos personales. La identidad no es sólo por lo que se publica, sino por lo que otros publican acerca de uno mismo. Este servicio es lo mismo que Google Alerts con la diferencia de que es parte de la interfaz del buscador, por lo que cada usuario podrá configurar su cuenta personal según reportes de PC World México.

Con el aumento de robo de identidades y la existencia cada vez mayor de piratas cibernéticos, esta herramienta se convertirá en un extra más eficaz si le importa cómo se estén conociendo sus datos personales en la Web. De repente se reciben llamadas telefónicas o correos de empresas con las cuales no se ha contactado y la primer pregunta es ¿de dónde consiguieron mis datos?. Es de esta manera cuando sus datos quedan flotado en la red y hay que tener mucho cuidado, sobre todo darse al trabajo de 'limpiar' cuando se dejan los datos personales 'colgados' en cualquier lugar del ciberespacio.

Fuente de Imagen: Wikimedia

Editor: Cristian Segura writes articles related with technology, social media and marketing. Sponsored by Costa Rica Hotels, Motor de reservas en linea and Travel to Costa Rica