This article is part of a Curacity series to help hotels plan for budgeting season. We asked Michael Goldrich, an end-to-end digital marketer and generative AI advisor with deep hospitality experience (Starwood Hotels & Resorts, Wyndham Hotel Group, Denihan Hospitality Group, and more), to weigh in on what hoteliers need to know now.
Hotel marketers often face a challenge: attracting guests and driving bookings with tight budgets, especially in today's economy. The difficulty is compounded by the changing digital landscape, where new marketing channels constantly emerge. As a strategic advisor, I'm frequently asked how hotels can make the most of limited marketing resources without sacrificing results.
When faced with a flat budget or the need to account for rising media costs, hotels have some challenges to overcome, but there are opportunities to optimize direct bookings and reduce reliance on costly OTA commissions.
The Challenge: Limitations of Traditional & Digital Marketing
Digital marketing channels can be expensive and only sometimes deliver needed results. Google Ads, for example, can be unpredictable. You might spend thousands on clicks without seeing a proportional increase in bookings. The unpredictability is particularly challenging for smaller properties or those in highly competitive markets.
Traditional PR agencies often have high costs — retainers of $5,000+ per month for a single property and often much more. Such an investment can be too expensive for many hotels, especially boutique properties or those in smaller markets. Additionally, these agencies usually struggle to link their efforts directly to actual bookings and revenue. They lack sophisticated tracking technology to make those connections. The gap between effort and measurable results can frustrate hoteliers trying to justify their marketing spend.
So, what can a hotel with a limited budget do? Performance-based marketing is changing how hotels approach their marketing efforts. The performance model aligns the interests of the marketing provider with those of the hotel, ensuring both parties focus on generating actual bookings, not just impressions or clicks.
The Opportunity: Performance-Based Marketing
Performance-based marketing allows hotels to only pay for marketing that works. Companies like Curacity are leading this approach. Hotels only pay for consumed bookings — after the guest has completed their stay. The risk shifts from the hotel to the marketing provider, ensuring marketing dollars are only spent on efforts that directly contribute to revenue. The model reduces the risk of wasted marketing spend, making it attractive for hotels with limited budgets.
Performance-based marketing also offers measurable ROI. With advanced attribution technology, companies can track bookings resulting from their efforts. Clear data on return on investment is provided to hotels, which is helpful for properties working with limited budgets. The ability to directly link marketing efforts to actual bookings allows hotels to make better decisions about resource allocation.
The performance-based approach often gives hotels access to premium content placements typically out of reach. Curacity, for example, partners with AFAR, Condé Nast Traveler, Travel + Leisure, and other top-tier media brands, allowing hotels to secure placements in these publications without the usual high costs. Small luxury, boutique, or independent hotels that might not otherwise afford to compete with larger brands for these placements can particularly benefit.
Other strategies can help stretch a limited budget:
- User-generated content is powerful. Encouraging guests to share experiences on social media and review sites provides authentic, cost-effective marketing material. Make it easy and rewarding for guests to share their experiences.
- Focusing on direct bookings is smart. Improving your website and booking engine can increase direct bookings and reduce reliance on costly OTA commissions. You also gain more control over the guest experience from the first interaction.
- When done well, email marketing remains cost-effective for driving repeat bookings and increasing guest loyalty. Building and nurturing your email list should be a priority. Provide value in your emails, not just promotional content.
- Local search optimization can significantly improve visibility in local search results at no additional cost. Keep your Google My Business listing complete and up to date. Respond to reviews and add high-quality photos to boost your local search presence.
- Collaboration can expand your reach. Partner with local attractions, restaurants, and complementary businesses for cross-promotion. These partnerships can include joint packages, promotions, or cross-promoting on social media.
- Good analytics are crucial. Invest in tools to track the performance of all your marketing efforts. Identifying which strategies deliver the best ROI allows for more effective budget allocation.
- Focus on metrics directly tied to revenue generation: cost per booking, revenue per booking, guest lifetime value, direct booking ratio, and ROI by channel. These provide a more complete view of marketing performance than traditional measures like impressions or click-through rates.
The path forward is clear: optimize ROI through strategic, data-driven marketing to succeed. In today's competitive environment, approaches like performance-based marketing are essential for survival and success in the hospitality industry. By focusing on measurable results and embracing new models, hotels can turn limited budgets into tools for growth and competitive advantage.
Ready to take the next step? Check out the next article in the series, Ask a Strategic Advisor: Balancing Traditional and Digital Marketing in Your Hotel Budget. Or, explore our latest white paper with HSMAI, From Last-Click to First Look: A Commercial Strategy Makeover Story for Upper Funnel Marketing.
Want to learn more about how Curacity can help you this budgeting season? Fill out our ROI Calculator or get in touch to start a conversation.
