How can Google re-establish it’s moral and useful, self admitted position on planet search and in particular in the travel industry?
NB: This is an opinion by Richard Vaughton, director at DiscoveryHolidayHomes. It is the first of a two-part series looking at the future of hospitality and technology through prism of search and Google.
Our story starts one Sunday morning, tapping away on keyboards trying to keep the search gods happy.
An hour later we were analysing the result from the money spent on the big marketing platforms who interestingly dominate the search engines, which earlier, we were trying to make happy!
What we were doing was not unusual however: playing both these games and trying to outgun the big spenders who are influencing all rental businesses.
Failing a human sacrifice it would be hard to succeed on any scale. So why on earth are we trying?
The answer is:
history and what we have always done hope that we can achieve the almost impossible what else can we do?
Certainly not give in and come under complete business control from the growing number of channels.
It occurred to us that this is a ridiculous set of circumstances developed through vast monetary influence, some of which has been contributed by our company.
We have a fairly sizeable inventory and to be very focussed on each property is impossible. Locale focus is easier but again, we are up against our close competitors all fighting for their own bit of digital rental real estate and suffering the same problems.
We are in an industry of unnatural complexity and may well be served by rethinking “Chaos Theory”. The following is a snippet of the business which shows the data streams and money channels.
The big listing (and now hybrid/booking, travel brand sites) have huge inventories and are also competing against us with our own inventory.
They are also preaching to the unsuspecting public, unsustainable global marketing messages, such as: “Stay in a rental for a night, it’s cheaper than a hotel.”
The net effect of all this is that guests are often incapable now of understanding why they see different prices, don’t get credible answers, can’t find phone numbers and are clearly getting confused!
It is “rental chaos” in the true sense of the word.
Add to this the technology liabilities from companies who live and die by profits margins and overheads, and any failure in systems puts all small businesses under threat daily. The net is awash with complaints.
Add in the continual “upgrades” that restructures the data to make it more distributable, more “ecomm” acceptable without warning and the chaos is enriched.
Not long ago I published an article deprecating Google’s search model which saw thousands of small businesses come to rely on its channel opportunities, both organic and paid.
They have now been left at the mercy of the hospitality aggregators with search apathy and confusion widespread among guests and owners!
Google open power
A glass of wine later whilst installing a new Google app for CRM purposes, I began to get a feeling that maybe my prayers would be answered in the not too distant future.
We use Google Pro tools in many sectors of our business. Google is notoriously bad at its interfaces, setup procedures and GUI’s but the combination and level of services I rely on is either very worrying or a great professional decision by us.
The latter is my opinion even if Google have dealt me and the industry a lot of bad cards in recent years. All systems work, almost faultlessly and are good value!
The ability to tie all the tools together, and interface externally shows a sharing open concept, which has endless opportunities and is diametrically opposed to the aggregation sites and walled garden corporations we are beginning to expect as the norm.
Commonality of thought
Many people in our industry speak the same messages: We feed the big listing sites, they pay Google and invest in search dominance and also redistribute inventory.
Chaos ensues and the direct guest/owner linkages are lost and real property and location knowledge is diluted like Chinese whispers. This is not a great guest experience and this should be the key primary key driver for any travel provider, either as a single property owner or large agency.
There is however an issue that is beginning to see subliminal discontent with the way results are published on Google.
This could be rephrased as:
“We will allow whoever pays the most through advertising cost to rank No.1 or if they wish to invest heavily in navigating our search algorithms we will allow dominant positions in the organic positions.”
This is not search it’s an online catalogue with the biggest payers at the top.
In a recent interview, HomeAway CEO Brian Sharples says:
“As a company, we’re having to work pretty hard to get people through that transition (referring to online bookings) but it is now starting to accelerate dramatically because one of the weapons we have in our arsenal to push ecommerce are things like search position.”
This “pay to the top” is an expensive game and our rental margins are required to permit it. The margins come from guest or inventory holder.
The interview goes on to say:
“The core of our base is people who have been doing this for a very long time across Europe, across the US. Our site has always delivered a lot of money to these folks.
“They have figured out their offline ways of collecting cash and doing things and it works for them. And they make lots of money. And they are super happy.”
The perception there is a lot of money in the pipeline and therefore accessible, is a worrying statement. Micro-businesses do not have the benefit of scale and “super happy”?
No comment.
There is also a growing number of businesses who actually take money online and do so directly, which is the preferred route.
This is a “melting pot of complexity” with millions of micro-businesses being funnelled into channels, bleeding margin, confusing guests and offering limited choice of companies.
This search monopoly by travel intermediaries is detrimental to many of millions of small businesses, due to elevated fee structures, business model control and lack of experiential projection.
Google’s growing problem AND opportunity
This is a problem for both guests and inventory managers but is also a problem for Google as people speak with their feet or fingers and the online world is fickle in the extreme.
The world is rich, varied and with over seven billion personalities and millions of micro-businesses cannot be reflected on a page with ten results.
It needs specialist targeting and deep and broad levels of knowledge to succeed & arrive back at Google’s core tenet.
In the coming years it will also require intelligent mobile applications that can access real time data from many sources, to offer the best experience suited to that individual or family.
This is a quote from Google’s own website and mission statement!
“Focus on the user and all else will follow.
“Since the beginning, we’ve focused on providing the best user experience possible. Whether we’re designing a new Internet browser or a new tweak to the look of the homepage, we take great care to ensure that they will ultimately serve you, rather than our own internal goal or bottom line.”
Guest search apathy and confusion has definitely set in, but the aggregating middleman still dominates this entropic wilderness whilst the evangelical few beat the drums for change.
The last line can be appreciated and is a good reason for Google to adopt a great travel industry strategy. In volume terms this is a huge industry. Without delving too deeply 75% of Western world make a trip at least once a year and IATA states over 2.5 billion people travel yearly.
To move laterally will not necessarily mean a profit deficit and will as quoted “ultimately serve you”.
So all may not be lost and Google may already be putting the “Good” back in its name!
Search purity: Google – remove the middle-man, use the data
There are many industries where the Internet has empowered small businesses and allowed them to flourish. If there are many of these businesses with a common purpose then herding them into a marketing coral is a tried and tested business model.
This is the current holiday rental business model, desperately attempting rapid monetisation before the weather changes.
Google does allow anybody to go direct via PPC, but in recent years the cost, pushed up by the middlemen, means it is becoming prohibitive, is complex and there is only so much space on a computer screen and less on a mobile device.
Many industries have decided to trade directly in recent years however: airlines and insurance are two large examples, both benefitting from the Internet. Travel agents and brokers have suffered because of this, they still exist of course, but the increased margins and customer data are just two benefits for the product or service suppliers.
Direct suppliers have better data resources in the long term, more intelligence and opportunity to offer direct deals to existing clients.
These scalable businesses can manage the entire marketing spectrum and can afford to spend a few years on customer acquisition. Not so a micro-business with ten customers per year, unfortunately.
Which company with a global reach has the greatest amount of personal data however? Perhaps it’s Facebook! But which company has access to the widest range of personal data, from search habits, to email correspondence to finance and more, it has to be Google.
Now imagine pulling all the data together and tailoring it in real time to your particular demographic.
It knows the sites you have searched of course, it could match this to the holidays in your Google calendar, perhaps identify your love of salmon fishing through purchase history and your latest YouTube video, or even the fact you have recently subscribed to a new credit card and it’s your 50th birthday soon.
Using a Google travel tool, as a searching guest you may well be offered the perfect holiday celebration at the right price in the correct week and be able to take advantage of the points on your new credit card! You may also see a chap salmon fishing in the advert!
Now consider how much Priceline, Expedia et al pay to Google for adverts.
Google is minting money, but they know the margins given up by inventory controllers far outweigh the income they receive from advertising.
So maybe it will feel that a slice of this is more deserving but more importantly may well reduce the issues now presenting on Google search and its dominance by the few and displeasure by the many!
NB: In the second article in this two-parter, I will ask this process might work from a practical and strategic point of view for Google, intermediaries and suppliers.
NB2: This is an opinion by Richard Vaughton, director at DiscoveryHolidayHomes.
NB3: Magnifying glass Google image via Shutterstock.
