CONDITIONS OF PUBLICATION
This project was undertaken in conditions which restrict publication or circulation to the examiners. Other publication or circulation may only be given with the consent of the project supervisor. A date for release of restrictions must be stated where possible.
In the hotel industry, the success or failure of the marketing strategies directly affects the hotel financial performance Generally, traditional media such as printed letters, TV, Radio and billboards are the first choice to be selected by hotel marketers to promote products or brands. However, with the growth of internet users, network effect becomes the most influential medium in the world. The rapid development of internets even surpasses the traditional medium. Due to the importance of marketing strategies in the hotel industry, utilising marketing strategies whether in traditional or digital way become the most important considerations. This research is based on qualitative method, collecting data from 5-star hotels in China and face-to-face customer interview. By comparing the marketing strategies the hotels used to the feedback from the customers, it is more visualized to see whether the hotel’s choice of marketing strategies meet the needs of their customers or not. According to the investigation, the present study has contributed that digital marketing played an important role in the hotel industry. The analysis of interview data indicates that the status of digital marketing has greatly improved compared to before. The promotion of digital marketing does not mean the disappearance of traditional marketing model. As a result of the current data, the researcher conclude that hotel marketers utilize digital marketing strategies more than traditional marketing. However, traditional marketing is still used to retain elderly loyal clients in the hotel industry.
Keywords: Traditional Marketing, Digital Marketing, EWOM, Social Media, Influencer, Native Advertising
I am very grateful to those who helped me during my thesis writing. First and foremost, I would like to show my deepest gratitude to my supervisor, Professor. Liang who has provided me with a valuable and clear guidance in each step. Without her patient and instruction, I could not complete my thesis. Secondly, I do appreciate that I get the help from Hotel Managers and Millennials. They provide the data and help me complete this dissertation. Last but not least, I would like to thank that I have an opportunity to study in Trinity College Dublin.
Table of Contents
AUTHOR’S DECLARATION 1
CONDITIONS OF PUBLICATION 2
LISTS OF TABLES 8
CHAPTER 1: INTRODUCTION 9
1.1 Overview of Research Background 9
1.2 Research Aim 9
1.3 Research Objectives 9
1.4 The Research Question 10
1.5 The Research Method 10
1.6 The Research Motivation and Contribution 10
CHAPTER 2: LITERATURE REVIEW 12
2.1 Traditional Marketing Strategies 13
2.1.1 The overview of traditional marketing strategies 13
2.1.2 The Effectiveness of Traditional Marketing Strategy in Hospitality 13
2.2 Electronic Word of Mouth Strategy 15
2.2.1 Overview of EWOM 15
2.2.2 TripAdvisor and Qyer 15
2.2.3 EWOM Effects in Hospitality 16
2.3 Social Media Marketing Strategy 19
2.3.1 Overview of social media marketing strategy 19
2.3.2 Direct Social Media Channel (WeChat) 19
2.3.3 Indirect Social Media Channel (Little Red Book) 20
2.3.4 Social Media Marketing Effects 21
2.4 Influencer Marketing 22
2.4.1 Influencer Marketing Effects 22
2.4.2 Influencer Marketing in the hotel Industry 23
2.5 Native Advertising Marketing 24
2.5.1 Overview of Native advertising & JW Marriott Example 24
2.5.2 Native advertising approaches in the hotel industry 24
CHAPTER 3: RESEARCH QUESTIONS & METHODOLOGY 26
3.1 Research Questions 26
3.2 Methodology 27
3.2.1 Research Philosophy 27
3.2.2 Sampling and Respondent Selection 27
3.2.3 Interviews Design 28
3.3 Research Ethics 30
3.4 Data Collection and Analysis 31
3.5 The Summary of Methodology 32
CHAPTER 4: FINDINGS AND ANALYSIS 33
4.1 Introduction 33
4.2 Demographics of Participants 33
4.3 Marketer Perspective 35
4.3.1 Hotel Revenue 35
4.3.2 ROMI (Return on Marketing Investment) in Digital and Traditional 37
4.3.3 The Comparison of Traditional and Digital Marketing 38
4.4 Customers’ Perspective 40
4.4.1 Information Gathering Channels 40
4.4.2 The Influential Factor – Word of Mouth 42
4.4.3 Incentive Program 43
4.5 Marketer’s Expectation 45
4.5.1 Low Cost and High ROMI 45
4.5.2 Improve Engagement 45
4.6 Customers’ Situation 47
4.6.1 Low Social Engagement 47
4.6.2 Digital Marketing Consciousness 47
4.7 The Gap Between Marketer’s and Customer’s Perspective 48
CHAPTER 5: DISCUSSION AND IMPLICATIONS 49
5.1 Introduction 49
5.2 Discussing the main findings 49
5.3 Managerial Implications 50
5.3.1 Social Media Strategy 50
5.3.2 EWOM 50
CHAPTER 6: LIMITATIONS AND RECOMMENDATIONS 52
6.1 Limitions of the Research 52
6.2 Recommendations for Future Research 52
CHAPTER 7: CONCLUSION 53
Appendix 1: The Sample of WeChat 54
Appendix 2: A Consent Form 55
Appendix 3: An Interview Guideline 56
Appendix 4: Samples Interview Questions 57
Appendix 5: Interview Documents 59
LISTS OF TABLES
Table 1: Five participants of hotel managers and their demographics 33
Table 2: Ten Respondents of hotel customers and their demographics 34
CHAPTER 1: INTRODUCTION
1.1 Overview of Research Background
With the economy growth, tourism has become the third largest socio-economic activity in European Union. Tourism industry along generated 5% of EU GDP. (Marinescu, 2017) Hotels play a vital role in the tourism industry. To enhance hotel sales, marketers utilize various marketing strategies from the traditional marketing strategy to the digital marketing strategy. With the growth of internet uses, digital marketing’s powerful and influence cannot be ignored. The research shows that there is a 11.8% increase in online bookings from 2012 to 2013. (Pete & Lanz, 2014) Quach pointed out regarding to the increased online demand, it is important for hotel marketers to put more marketing efforts on social media. If marketers adopted social media marketing correctly, social media marketing would be much more effective than traditional marketing. (Quach,2017)
This study investigates the effectiveness of traditional and digital marketing in the hotel industry and looks into the dispute over the two marketing strategies, to reflect their status and resentations in the hotel industry.
1.2 Research Aim
The debate as wheter or not digital marketing surpasses traditional marketing still continues to be discussed. (Digital Marketing Strategy, 2018) The aim of this dissertation is to evaluate the effectiveness of marketing strategy applied by hotels from both customers’ and hotels’ perspective.
1.3 Research Objectives
The background analysis and interviews process can provide the insights to the research question: traditional marketing and digital marketing, which one is better to be used in the hotel industry? Applying to this research question, this study will conduct the following objectives:
• To evaluate marketing strategies from marketers’ and customers’ perspective.
• To define the status and effectiveness of traditional and digital marketing strategies in the hotel industry.
• To decide which is the better marketing approach utilized in the hotel industry.
• To find the gap existed between customer purchase making & company perspective.
1.4 The Research Question
Based on the research aims and objectives, the researcher seeks answers to the following research question:
Is digital marketing strategy more functional than traditional marketing in terms of attracting and retaining clients in the hotel industry?
1.5 The Research Method
To achieve research objectives and aims, this study adopts the realistic research philosophy. The researcher selects the qualitative research method to seek the answers. The sample is self-selected and all interviewees are voluntary to participate in this face-to-face interview. Total 15 participants are divided into two groups. One group contains five hotel marketing managers from four or five star hotels in China. 10 participants who have stayed in those interviewed hotels before will be another group. The researcher can collect data and useful information by semi-structured interviews. Moreoever, data is analyzed by audio-records and summarize documents (Appendix 5) There is a detailed explanation of research ehtics be Chapter 3 to ensure the data is trustworthy.
1.6 The Research Motivation and Contribution
Under macro environment, hotel industry has been developing rapidly as the Chinese economy and tourism improve in the recent years. The marketing strategy can directly influence the financial result. Effective marketing strategies can enhance hotel revenues and remain their industrial competitiveness. From the hotel perspective, it is interesting to analyze whether digital marketing has already overtaken traditional marketing. Meanwhile, from customer perspective, it can be discussed which marketing methods that customers welcomed most. The gap between markters’ perspective and customers’ purchase making decision would inspire the researcher’s interest.
As to contribution, whether the marketing strategy is effective or not is concerning the hotel’s development. Different industries have distinct marketing requirements. Hopefully, according to this research study, it can remind hotel managers to adopt marketing methods correctly. In additon, hotels do expect too much on digital marketing side and even deny traditional marketing. The purpose of this dissertation is to provide suggestions to hotel manager on how to market the hotel in this era of social media marketing explosion.
CHAPTER 2: LITERATURE REVIEW
This chapter is to provide reviews of marketing strategies which are adopted in the hotel industry. This chapter is divided into three sections. Firstly, it is worth to mention traditional marketing strategies which are related to spend advertising costs on TV, newspaper or banners on the street. It is the first traditional approach that hotel marketers use to promote their products and build up hotel brand images in the world. Secondly, it is worth to discuss EWOM strategy. With the development of internet, marketing strategy emphasise more on one to one online communication. More and more customers rely on the internet, and therefore, hotel marketers pay more efforts on building up a high reputation online. Thirdly, when it comes to discussing social media marketing strategies. Facebook, Instagram, Weibo, WeChat are four common social media channels which are utilized in the hotel industry. Nevertheless, new media and influencer marketing both are new-style social media marketing strategies to catch more prospective customers’ eyes.
2.1 Traditional Marketing Strategies
2.1.1 The overview of traditional marketing strategies
Traditional marketing is a broad category, including various forms of advertising and marketing. The general traditional marketing categories are print, radio, TV broadcast, billboards, mailing and telephone. Compared with digital marketing strategies, using the internet as their main channel, traditional marketing strategy refers to the channel passing from companies or products to their target audiences by old media as it is mentioned before. Each company utilizes more or less traditional marketing strategies, depending on their budgets. After all, old media needs to consider labour, timescale and budget. Although traditional marketing has a lot of limitations, it is still appealing and credible as mentioned by Katz. (2008) To be specific, adopting traditional marketing is much easier to reach target audiences. (Lilyquist, 2018) For instance, cooperative business plays an important role in the hotel industry. To reach this kind of target audiences, utilizing digital marketing cannot reach those demographics. Moreover, traditional marketing can achieve person-to-person marketing which lead to direct sales. (Lilyquist, 2018) Many customers would like to make their decisions after meeting in person especially when customers intend to make a group booking or hotel conference and event booking. (Lilyquist, 2018)Traditional marketing strategy is the method for hotels to promote customer interactions. Traditional marketing methods allow hotels to communicate with their potential customers and help their customers better understand hotel products by physical activities such as trade shows. (Tater, 2016)
2.1.2 The Effectiveness of Traditional Marketing Strategy in Hospitality
With the growth of internet users, digital marketing becomes more dominate. However, it cannot be concluded that digital marketing has already surpassed traditional marketing.
Belch ; Belch advertised the lifetime span of media exposures. (Belch ; Belch, 2006) Traditional marketing can influence prospective customers for three to seven days. (Trusov, Bucklin, ; Pauwels, 2008) Among those marketing strategies, magazine has the longest span time of exposures. (Blakeman, 2014) In addition, traditional marketing is tangible. Hotels invite journalists to write articles about their hotels to increase exposures in public. And magazines are easier to be saved and passed-by to read. Longer life-time traditional marketing communications can help marketers spend less budget to retain the effectiveness of marketing methods longer. (Geraghty ; Conway, 2016)
Turning to Business to Business side, formal conferences such as trade shows are critical for hotels to generate their revenues. (Ellis, 2011) Cooperative business is one of the most important sources of hotel revenues. Those demographics are not easier to be influenced by digital marketing. Traditional methods provide trustworthy platforms to pass hotel information to prospective customers directly. This kind of customer is more likely to be a loyal client than individual travelers. Compared with B2C (Business to Customer), B2B (Business to Business) can bring stable profits to hotels. Moreover, the cost to acquire a new customer is higher than retain a loyal customer. 70% companies believe that it is cheaper to retain a customer than acquire a new customer. (Brynley-Jones, 2013) There is no doubt that traditional marketing has the ability to retain customers longer.
2.2 Electronic Word of Mouth Strategy
2.2.1 Overview of EWOM
Word of Mouth marketing refers to the enterprise’s efforts to make consumers spread brand awareness through communications between their relatives and friends. Moreover, EWOM means that companies or consumers share about the company, product, users’ experiences or all kind of multimedia information through blog, videos and network channels. The corresponding communications can impact on the brand reputation which can also affect its business in some areas. “Similar to WOM, research has shown that eWOM may have higher credibility, empathy and relevance to customers than marketer created sources of information on the Web.” (Gruen, Osmonbekov, ; Czaplewski, 2005, pg449) People more and more rely on the internet search with the increased mobile penetration rate. In 2020, the mobile penetration rate will be 75%. In order to attracting more customers, marketers put more efforts on building EWOM on the network side. The cost of internet advertising raised up to 22 billion dollars in 2004. (Grtzel, Yuan, ; Fesenmaier, 2000) Hotel marketers find that public opinions can affect marketing strategy. (Twedt, 1967) That is the reason that EWOM seems to be more popular than WOM strategy.
2.2.2 TripAdvisor and Qyer
Brand trust is the tie between customers and suppliers. “Purchasing a good or a service inherently has an element of risk-anticipated consumption dissatisfaction-that naturally some consumers wish to mitigate.” (Pihlaja, Saarijarvi, Spence, ; Yrjola, 2017, pg.340) If customers trusted the brand, the company would achieve their expectations with less efforts. Product reliability is built on user experiences. To attract more potential audiences, WOM is the approach to pass user experiences between non-commercial communicators. EWOM is the extension of traditional WOM strategy, focusing on online communications. Customers can review comments and feedbacks from online platforms such as TripAdvisor, Qyer etc. The following paragraph will discuss the examples of EWOM strategies utilized in the hotel industry.
To be specific, there is an example TripAdvisor, a tourist experience sharing social media platform. TripAdvisor has over 10 million registered online members and over 20 million reviews and opinions in relation to hotels and attractions which are generated by their users. (O’Connor, 2010) Travel Weekly did the survey to investigate the importance of TripAdvisor. It found that nearly half tourists searched and read online reviews on the sites. Almost all participants recognize the influences of TripAdvisor. Above 20% of participants’ decision-making is influenced by online reviews. (Okazaki, Andreu, ; Campo, 2016) There is no doubt that comments and reviews can affect customers’ decisions. Because of those potential influences, hotels spend time on managing customers’ comments and reviews on TripAdvisor site. From the hotel aspect, they do not have the chance to remove or change negative comments, however, they have the opportunity to reply to customers who leave complaint comments on the site. In the study, it is found that less than 0.5% comments are replied by hotel managements. (O’Connor, 2010) Although EWOM is hard to be controlled, hotel marketers still have the opportunities to manage them better than now.
Another example, Qyer is the largest Chinese travel community and the function of Qyer is similar to TripAdvisor. There are about 10 million Qyer users and currently 40,000 overseas destinations which can be searched through the site. (Donna, 2015) Qyer encourages people to write and share their expressions on the site. However, Qyer is focusing more on helping people make a travel plan rather than book hotels. The dominate function of Qyer is the social platforms, offering travel plans, visa solutions and attraction recommendations. Hotel bookings, car-rental and tickets booking are the auxiliary industries.
In China, hotel marketers apply EWOM strategies by using TripAdvisor and Qyer. TripAdvisor helps marketers raise their hotels’ rank and popularity on the site. To increase the network exposures, Qyer helps to create hotels’ brand awareness or image through the travel diary.
2.2.3 EWOM Effects in Hospitality
The increasing number of social media usage makes EWOM more important. 89% visitors and 61% hoteliers believe that hotel reservations are influenced by online hotel reviews. Because nearly 95% travelers review online comments before making their travel decisions. (Hu & Chen, 2016) Especially in the hotel industry, strengthening the importance of online reviews could lead to hotels’ increased popularity on the sites. (Ladhari ; Michaud, 2014)
Firstly, in some studies in marketing field, it demonstrates that company’s finance is affected by online reviews. (Giampaolo, Roberta, & Dimitrios , 2016) Positive comments reflect the pleasant environment and satisfying description of staying experiences. However, negative comments are more about complaints. Ladhari and Michaud demonstrated that positive online comments can enhance hotel booking sales. (Ladhari & Michaud, 2014) Nevertheless, more positive comments can improve the hotel ranking and search popularity on the site. Also, Marketers find the importance of EWOM strategy. Compared with high cost of advertising, EWOM is the marketing strategy to yield twice the result with half the effort. Hotel marketers find that online public opinions can lead to sales raise. It is the most important reason that hotels utilize EWOM as the dominate marketing strategy. As it is mentioned before, positive comments can enhance online bookings. Also, trust or credibility is one of the most influential factor which affects hotel bookings. (Ladhari & Michaud, 2014)
Secondly, “The EWOM, also known as online rating or review systems, delivers credible and relevant product information to potential customers, and thus has a significant impact on consumer choices.” (Park, Wang, Yao, & Kang, 2011, pg 75) Obviously, EWOM strategy can help hotels improve their credibility. As it is mentioned before, reviewing comments online becomes critical for prospective customers to complete their purchase. (Park, Wang, Yao, & Kang, 2011) Turning to the relationship between perceived EWOM credibility and EWOM effect, if people thought online information is credible, they would trust EWOM comments. Whereas comments were not trusted, hotel images would be damaged. (Park, Wang, Yao, & Kang, 2011)
Thirdly, EWOM strategy is the approach to help hotels expand overseas markets. Generally, strong branded hotels have strong sense to build up their brand images. Over 70% of hotels are branded in USA and this ratio still keeps increasing. Branded hotels bring customers more trusts. Strong hotel brand can eliminate search costs and reduce perceived risks. (Kayaman & Arasli, 2007) Moreover, those brand trusts are accumulated by EWOM strategy marketing efforts. For instance, China is one of the countries with the largest internet users. When Sofitel hotel chain entered Chinese market, and engaged in mainland of China, their marketing managers expressed clearly that digital marketing is the key to strengthen the relationship between hotels and customers. Due to change of target audience, Generation Y and Z spend much more time on internet rather than traditional media. In order to follow up the new trend, EWOM cannot be neglected.
Last but not the least, via EWOM strategy it is easier for hotels to find their orientations. Hotels are ranked and classified into different levels. Measuring a hotel brand is decided by the quality service, media publicity and customers’ satisfactions. Those measurements create a hotel brand. (Glavor ; Koncul, 2012) The same standard of hotels can be distinguished by their EWOM on the site.
2.3 Social Media Marketing Strategy
2.3.1 Overview of social media marketing strategy
The key function of social media is information-sharing. (Quach, 2017) It is estimated that nearly 65% of world population engage in social media channels to share their images, experiences and video. (Quach , 2017) The new version of social media is predicted as the most popular marketing approach in the future. According to the research, there is a sharp increase number of internet users all over the world. In the US before 65% of internet consumers spent their time on social media channels. But now, at least 85% internet users operate their social media channels especially Facebook, Twitter and Instagram. (Leung, Bai, ; Stahura, 2015)
But hotels promote their activities and special offers via Chinese social media channels. The most common channels are WeChat, Sina Weibo and Mafengwo. Also, there are upcoming new channels such as Little Red Book and Douyin which have already been engaged into people’s life. (Thai, 2018) Among those social media channels, WeChat and Sina Weibo are controlled directly by hotels themselves. While Mafengwo, Little Red Book and Douyin rely on receiving comments by social media users.
2.3.2 Direct Social Media Channel (WeChat)
WeChat becomes the vital marketing approach utilized in the hotel industry in China. To connect with customers properly, Marriott, Hyatt, Sheraton, Shangri-La and Sofitel open the official WeChat account. (Yuan, 2017) Marketers can control and manage WeChat account directly by themselves. The main responsibilities of WeChat are to maintain CRM, enhance online bookings and provide better customer services.
Processing Customer Relationship Management by WeChat, hotel marketers post daily events via WeChat official account. Meanwhile, subscribers can find the main event on WeChat main page. (Appendix 1) Moreover, customers can be invited to join in hotel events and campaigns. Hotel marketers can collect feedbacks and customer data via their subscriptions. When festivals and holidays arrive, hotel marketers can send greetings from WeChat system on the basis of their customer database. (Yuan, 2017)
JW Marriott and Shangri-La hotels provide online booking services by WeChat. WeChat has cooperation with Ali-Pay and WeChat wallets. (Launches Online Event Reservation Platform on WeChat, 2014) From hotel aspect, they encourage customers to book through their own channels to save commission fees against Online Travel Agency. (Yuan, 2017)
Hotel marketers can receive the first-party statics from Admin platform. Hotel marketers can acquire analysis in relation to Customer, Graph and Information Analysis. Customer Analysis indicates the number of subscribers, CTR and the number of shares. Followed by graph analysis, it reflects that how many reviews and how many target audiences efficiently reached. Information Analysis focuses on views such as how many times customers shared and read. Those data support hotel marketers to follow up loyal clients and reach target audiences properly. (Yuan, 2017)
There is no doubt that WeChat plays an important role in the hotel industry. Different hotels have different designs for their WeChat. Ultimately, developing WeChat is the method to increase the value of hotel brand and image.
2.3.3 Indirect Social Media Channel (Little Red Book)
Little Red Book provides a safe space to customers to write reviews and share their shopping experiences on the site. Contents on the platform are about fashion, beauty and travel. (Hitters, 2018) Generally, Little Red Book active users choose this App when they are curious about new products, desiring to do research on the new product.
For hotels, hotel marketers can realize their target audiences properly and they can provide a comfortable and social relationship with their customers through Little Red Book. (Yang , 2018) Based on customers’ requirements, Little Red Book links the content to customers which they are looking for. It increases social hits and develops social engagements from customer side. (Yang , 2018) Little Red Book does not do any advertisements on their channels. All promotions come from Users’ recommendations based on their experiences.
Little Red Book is indirect social media channel which are organized by app users. It has strong relationship with EWOM strategy, and is more credible and trustworthy.
2.3.4 Social Media Marketing Effects
With the explosive growth of social media channels, hotels change the way to retain and attract their customers. (Leung, Bai, & Stahura, 2015) In the research findings, it is found that customer’s using experience can impact on their attitudes towards hotel brands and social media sites. Moreover, social media marketing can affect booking intentions and EWOM. The most important findings from marketing effectiveness model show that hotel marketers can use the same social media marketing strategy to apply to different social media sites. (Leung, Bai, ; Stahura, 2015)
Social media marketing is the fast way to spread hotel brand and awareness to the world. Good or bad evaluations of hotels can influence hotel sales and their brand built.
2.4 Influencer Marketing
“Influencer marketing is like a hybrid of old and new marketing tools, taking the idea of the celebrity endorsement and placing it into a modern-day content-driven marketing campaigns.” (Influencer MarketingHub, 2018) Customers can find that all social media campaigns are collaborated with hotel brands and influencers.
2.4.1 Influencer Marketing Effects
Celebrity effects perform better than commoners effect as social media develops. Generally, not all influencers are traditional celebrities. They are called bloggers, sharing life story and posting images on social media channels. Influencers can get sponsored from high brands and engage high brands (brand integration) into their channels. The traditional content marketing focuses on SEO and Google AdWords to promote brands. However, influencer content marketing such as a blog piece, a shareable written content or a high-quality image, put efforts on content-managing. As the result, influencer marketing creates a great return to the business. (Foster, n.d.) Compared with traditional methods such as TV, influencer marketing can hit customer’s heart and bring brand to their daily life. (Wong, 2018)
Moreover, influencer marketing can help hotel marketers improve reach and social engagements. (Izea, 2017) Reach is the metric to measure whether or not influencer marketing can catch target audiences. However, there is an example which shows the side effect of influencer marketing. Under the cyber network, the fact is that 78% followers from the Ritz-Carlton’s influencers are reportedly fake. As to engagement, social engagement means the interactions between audiences and social media channels. Influencer marketing provides a chance to develop social engagement between hotels and their target audiences.
As influencer marketing expanded, 67% marketers think that influencer marketing content helps them achieve their target, leading the positive results. (Contestabile, 2018) There is no doubt that the efficient marketplace helps hotel industries generate more revenues as they expect.
2.4.2 Influencer Marketing in the hotel Industry
Obviously, influencer marketing is preferred by hotel marketers. Comments on the social media sites are difficult to be managed and controlled. However, as the extension of network influencers, KOL (Key Opinion Leader) becomes a new trend to promote hotel services, products and brands. KOL is more professional than influencers. Generally, KOL are authorities in the certain industry. They have high reputations in the hotel field and their suggestions universally can be accepted more easily, compared with common network influencers.
Due to those changes, there is an activity held in China in 2018. 15 KOL from hotel industry were selected to stay in more than 60 hotels, evaluating and marking all of them. Then the professional recommendations will be given when the result comes up. The result will be published on the influenced social media channels. The result can directly affect hotel brands.
Frequently, network influencers impart recommendations by user experiences accumulated. While KOL give suggestions based on both their professional knowledge and staying experiences.
2.5 Native Advertising Marketing
2.5.1 Overview of Native advertising ; JW Marriott Example
“Native advertising is a form of paid media where the advertisement is relevant to the consumer experience, integrated into the surrounding content and is not disruptive.” (Love, 2017) In other words, native advertising is a profitable model based on user experiences. It is driven by content advertising and integrates the visual design of website and App.
The most common format of native advertising is advertorials in newspaper and magazines or Sponsored posts on social media channels. This kind of marketing format is less intrusive. Because audiences can be reached randomly. In details, compared with posting on newspaper and magazines, marketers prefer to utilize sponsored advertisements to promote their new products. Regarding to reaching more new target audiences, Sponsored posts can help hotels reach more target audiences.
According to the surveys, it is found that 86 million American consumers start to use ad blockers. Because native advertising strategies are coming up with new ideas which makes commercial massage looks more attractive. (Richardson, 2017)
There is an example about native advertising used in the hotel industry. In the autumn of 2014, Marriott Hotels used VR technologies to promote “Virtual Travel Experience”. The idea of teleportation has become more successful as native advertising. Marriott hotels had with Reddit, asking them to post visual and interesting content on their page. After processing native advertising strategy in Reddit, it is found that there were nearly 200,000 clicks on the sponsored posts and Marriott achieved the highest numbers of clicks on Reddit. (Vinderslev, n.d.)
2.5.2 Native advertising approaches in the hotel industry
1. Facebook Sponsored Stories
Sponsored Story is the new advertising method that marketers utilize to expose their brands or products. Enterprises, organizations or individuals purchase consumers’ interactions data to track their daily activities.
2. Twitter Promoted Tweets
Due to developing the social media engagements, advertisers create a deep interaction with potential customers by Twitter.
3. BuzzFeed Branded Content
BuzzFeed is a social news site without having any banners. All advertising contents are designed by BuzzFeed, publishing and spreading like a virus on the site in order to catch more target audiences randomly.
4. WeiBo Information Flow
In China, Marriott Hotels select WeiBo whose function is similar to Tweets as promoting native advertising social media platform. Customers can read articles in relation to travel experiences, the latest special offer and Marriott charity activities from Weibo popular article selections. There is no doubt that Marriott Hotels have more exposures on social media platforms. Moreover, Weibo information flow helps Marriott Hotels to target proper customers more accurately. The advertisements will be presented to the right people and potential customers can see the advertisements which are related to their interests.
The literature review takes the marketers’ perspective and evaluate the effectiveness of five traditional and digital marketing strategies in the hotel industry.
CHAPTER 3: RESEARCH QUESTIONS ; METHODOLOGY
This chapter is to explain the research questions which are based on the qualitative method by collecting data. Research directions are divided into two parts, hotel perspective and customer perspective. From the hotel perspective, there are 5 selective star hotels in China to join the interviews. There are massive marketing strategies which are utilized in different fields. From the interviews of hotels, the marketing strategies that hotel marketers are using can be determined. Turning to the customer’s view, the research can clarify the effectiveness of marketing strategies and whether the marketing strategies meet customers’ needs. The customer group is established to investigate this study. All participants are millennials (age 20-36) who are existed customers from interviewed hotels. Those investigations can determine which marketing strategies are suitable to be used in the hotel industry, digital marketing or traditional marketing.
3.1 Research Questions
This research study is to identify effectiveness of traditional and digital marketing and to clarify which strategies, traditional or digital marketing, are better to be used in a four or five-star hotel in China. Based on the previous literature reviews and in-depth interviews, the research questions are formulated in the following:
• Does the hotel main revenue come from traditional or digital marketing?
• What does ROMIs (Return on Marketing Investment) mean in digital and traditional strategies?
• Is digital marketing more functional than traditional marketing?
• How do the public get access to the information of hotels?
• Does public opinion lead to customers’ decisions?
• What factors drive customers to choose hotels again?
3.2.1 Research Philosophy
This research applies the realism philosophy. Phillips defined philosophic realism in 1987. He mentioned that “the view that entities exist independently of being perceived or independently of our theories about them.” (Phillips, 1987,pg.205) Realism is both a world view and a hypothetical research paradigm which contains various realist theories and ideas to product and develop. It is believed that in human cognition, men’s understanding and perception of objects are consistent with the actual existence of objects independent of men’s minds. Realism abandons idealized imaginations. It is generally believed that realism cares about reality and rejects idealism.
The method of realism is realistic in terms of the content it reflects. It takes the basic characteristics of reality as its goal and has a clear choice of objects. Thus, the aim of this dissertation is to review digital marketing and traditional marketing in the hotel industry under the current situation. The continuous debate describes that digital marketing has overtaken traditional marketing. From this point of view, this research will be conducted by qualitative research method to get further understanding of marketing strategies unitized in the hotel industry.
3.2.2 Sampling and Respondent Selection
“The process through which a sample is extracted from a population is called as sampling.” (Alvi, 2016,pg10) This research applies a non-probability sampling method. Non-probability sampling refers to the method by which an investigator draws a sample based on his/her subjective judgment. Generally, non-probability is chosen when researchers plan to conduct a qualitative or exploratory study. (Explorable.com, 2018) To select samples, these non-random participants are chosen by five-star hotel chains in China. It is the way to do independent choice. (Black, 1999) Using the voluntary sampling techniques, it is to determine interviewees who are willing to participate in face-to-face interviews. (Murairwa, 2015)
Turning to explain respondent selection, respondents are selected from two sides, hotel perspective and customer perspective. The major background is established in China’s mainland. Respondents are combined four or five-star hotel marketing managers with their customers.
From the hotel perspective, there is a massive luxurious hotel in the mainland of China. At the beginning, the researcher selected 12 hotels and send invitation letters and add WeChat to contact hotel marketing managers. The researcher received 5 responses from hotel managers, and they agreed to help researcher to conduct the individual interviews. The average age of those managers is under 40 years old. However, they have an in-depth understanding of marketing and hospitality. They work for the hotel marketing department at least one and a half years.
Turning to the customer perspective, there are 10 participants which are chosen to join the individual interview. The age of respondents (Millennials) varies from 20 to 36. Also, they are all existed customers who have stayed in those five hotels before. Hotel managers pick up respondents randomly from Front Office and ask them to be the volunteer.
3.2.3 Interviews Design
Qualitative interviews were conducted by in-depth interviews. Those interviews are semi-structured and the answer is open-ended. (Schmitz, 2012) Compared with General interviews and Informal interviews, Open-ended interviews are more structured and consistent. The researcher prepared a few questions which were related to explore the research topic in advanced. The participants were asked the same question. However, answers from those participants were open-ended. (Turner, 2010) According to their viewpoints and working experiences, they disclosed opinions of the research question. The interviews were designed separately in two sectors: Hotel Marketing Manager from hotel perspectives and Hotel Customers from customer perspectives.
The next part of doing research is to collect data, doing interviews with Chinese marketing managers in the hotel industry. The aim of doing qualitative interviews is not only focusing on data collection, but also on the way to acquire inspirations from interviewees. Each interview was organized from 30mintues to 1 hour. The researcher asked respondents prepared questions. According to their answers, participants might be asked follow-up questions. Based on the interviews with hotel marketing managers, the marketing strategies which were utilized in the hotel industry could be recognized and clarified. As the hypothesis which were listed before doing the interview, researchers could have the conjecture. In addition, the interviews were conducted by Voice Call or Face Time. From those manager’s narrative, it could enrich research questions and researcher could find more extensions about the topic.
From the customer perspective, there are 10 participants chosen to join in the interview. (Appendix 3 and 4) The main purpose of organizing interviews individually is to obtain a deeper understanding of the relevant research question by listening to respondents selected from target area. By listening to participants, researchers can find the unexpected discoveries. Moreover, according to results from customer perspective, it helps to figure out the gap existed of the research topic from customer purchasing making and hotels perspective.
Marketing strategies utilized in the hotel industry and the influences of marketing strategies on customer perspecitve are both obtained through those interviews which can help researchers to review the better marketing strategy used in the hotel.
3.3 Research Ethics
According to the Ethical Research principles from Trinity College Dublin, basically the research is expected to meet the basic standards of ethics. All research processes which are submitted are supposed to be conducted on the legal and the ethical way. (Trinity College Dublin, 2018) Minimizing the potential risks which may bring to participants, the researcher is expected to reduce or discomfort of participants as much as possible. (Appendix 2) Absolutely, respondents have the choice to attend the interview or not, depending on the judgments of potential risks which they consider. (Trinity College Dublin, 2018)
Considering about the business confidentiality, all data collection from the interview content and voice record are permitted to be used on the dissertation by hotel marketing managers. There is no doubt that marketing managers have the right to answer or deny the questions. Turning to anonymity, “the chief way that researchers seek to protect research participants from the accidental breaking of confidentiality is through the process of anonymization” (Wiles, Crow, Heath, & Charles, 2007), anonymization plays a vital key on research process. Sometimes anonymization is the way to protect participants privacy and minimize the potential risks.
3.4 Data Collection and Analysis
“Whatever philosophical standpoint the researcher is taking and whatever the data collection method, the process will involve the generation of large amounts of data.” (Sutton & Austin, 2015) The data is generated by a logical and structured research method. Due to the limited time, all interviews are completed within two weeks. All interviews are organized by video or voice call, each interview intends to be processed within 20-40 minutes. The taped interviews and summarized documents can help the researcher extract key points from each interview, ensuring all data collected from the interview is related to its objectives and questions. Also, all interviews are processed in Chinese, the transcription process is to translate the interview content from Chinese to English based on at least twice listening. The researcher can classify respondents who have the similar opinions into the same category. It can help the researcher get answers and findings more easily.
On the basis of 15 interviews, the researcher is able to complete 15 individual summarized documents which contain the relative key points. According to those key points, the researcher can seek the findings and explanations which answer the research questions.
3.5 The Summary of Methodology
To conclude, the research question is designed in relation to the research objectives. The research method is adopted by empirical qualitative which means that all participants were asked the same questions. Hence, the researcher is able to compare their answers to those respondents. The primary data is collected from the semi-structured interviews. The interview content is designed by analyzing the marketing strategies which are utilized in the hotel industry. From the hotel perspective, the research can identify the marketing strategies which are used in the marketing department now. The questions to hotel managers are in relation to the professional marketing practices. Whereas, from the customer perspective, the interview questions tend to reflect the customer purchase making. Thus, the researcher can get the conclusion of the comparison of digital marketing and traditional marketing in the hotel industry, from the answers from hotel perspective.
The sampling is selected of 15 participants which includes 5 hotel marketing managers and 10 hotel customers. Audio-records of interviews and the summarized documents can be adopted to process and analyze the data. The research methodology design can allow the researcher to discover the importance of marketing strategies in the hotel industry. Meanwhile, the debate of digital and traditional marketing can be identified by this study.
CHAPTER 4: FINDINGS AND ANALYSIS
This chapter presents and analyzes the research findings based on the primary research data from the semi-structured interviews. The interviews are organized into two groups: hotel managers and hotel customers. Five in-depth interviews are conducted with hotel marketing managers which provide the evidences of utilizing marketing strategies in the hotel industry now. Also, ten hotel customers can help the researcher find the gap between marketers’ perspective and customers’ perspective. Integrating the findings from both perspectives, the researcher reaches a more specific result which is the relative effectiveness of digital and traditional marketing.
4.2 Demographics of Participants
There are two groups organized to conduct the individual interview. One group consists five marketing managers from different star hotels. Another group is of the hotel customers which are recommended by hotel managers.
Table 1: Five participants of hotel managers and their demographics
Table 2: Ten Respondents of hotel customers and their demographics
4.3 Marketer Perspective
4.3.1 Hotel Revenue
Marketing strategy is the tool to help hotels generate more profits. Whether marketing strategies are effective or not can be reflected on hotel revenues. On the basis of face-to-face interviews of hotel marketing managers, it is clear to be found that 80% hotel revenues come from loyal clients. Hotel Manager B and C share their answers below:
According to Manager B’s answer, 20% of loyal clients become the main force of consumption in the hotel. 80% of revenues come from repeated purchases which are completed by a small size of loyal clients. Moreover, the rest of revenues (20% of the total revenue) are spent by new customers or unstable customers, it accounts for 80% of total check-in customers.
Manager C expresses the importance of retaining a customer on generating hotels’ revenues.
Retaining customers is definitely the way to strengthen customers’ loyalty and keep hotel’s profits increasing. As it is mentioned by Manager B, loyal customers can bring more profits than new customers by cost reductions. In order to increase hotel revenues, managers absolutely adopt marketing strategies to retain customers.
Different hoteliers formulate different loyalty programs. Manager A and C describe how to use marketing strategies to improve brand loyalty.
In China, cooperating with companies is the main source to stabilize profits especially in small hotels or the hotel which is easier to be influenced by seasons. Generally, cooperative companies gather hotel information by traditional methods. In order to retain business customers, marketers utilize the following methods. As manager A said, calling or emailing is the way to retain customers directly. Sale representatives have the responsibility to maintain interactions with their customers. Email seems to be more direct to get response from customers. This finding is confirmed by Buzz & Go also, when it comes to choosing the preferred sources to retain customers, the number of choosing emails account for 82%, selecting social media channels only accounts for 8%. (Buzz & Go, 2015)
From tourists’ perspective, the digital technology is the method to strengthen their relationships between hotels and themselves.
As for business partners, hoteliers consider that digital marketing lacks face-to-face interactions. Compared with digital marketing, traditional methods can reach an agreement more quickly. Turning to tourists, digital marketing is better to be used to retain customers. Those two strategies have different functions and both can help hotels generate revenues. Depending on different customers’ structures, hotels generate their revenues by using different marketing strategies.
4.3.2 ROMI (Return on Marketing Investment) in Digital and Traditional
ROMI is the measurement to judge the effectiveness of marketing strategies. It can help marketers make better decisions about the future investment. Marketing is one of the most effective way to improve hotel finances. The marketers can achieve higher ROI by adopting accurate marketing strategies. Manager D explains the status of ROMIs’ in traditional and digital both side.
Marketing costs will eventually be added to the retail price. Higher marketing costs can impair price competitiveness, decreasing return on investments. As Manager D’s opinion, digital marketing can not only reduce marketing costs, but also can have even better results as adopting traditional marketing.
As marketers begin to use digital marketing channels, the nature of ROMI has changed. In this era of explosion in social media marketing, the hypothesis of ROI needs to be re-considered. The interaction between brands and customers is changing rapidly. Previously, when marketers adopt traditional methods, budget is the vital factor they concern. However, turning to the digital side, ROI can be influenced by publicizing brand or attracting fans. In other words, engagement and advocacy are two factors which can influence hotel’s ROMI.
At the beginning, cooperating with OTA is a win-win strategy. it is the fast way to increase hotels’ exposures, accumulating bookings and it also can help hotel tide over the off-season. However, OTA requires a high commission fee for each booking. Hotels lose their initiatives and the revenue can be impacted if this situation continues forever. Instead of handing commission fees to OTA, marketers consider increasing direct bookings by adopting digital marketing strategies. Depending on customers’ dependency on network, the hotel can strengthen the benefit of making direct bookings through own websites. It can not only reduce commission fees, but also leading to ROMI growth.
Nowadays, ROMI of utilizing traditional marketing is lower than adopting digital marketing. Concerning about revenues and costs, digital technology is the trend for marketers to yield results with less efforts.
4.3.3 The Comparison of Traditional and Digital Marketing
In the digital era, marketers require to recognize the differences between digital and traditional marketing. Grasping characteristics of digital and traditional marketing is the effective way to re-design a marketing plan in terms of attracting and retaining more customers.
Firstly, although the cost of traditional marketing is definitely higher than digital marketing, traditional marketing can help a forthcoming hotel to increase its popularity in a short period. For example, utilizing airport advertising banners or magazines can help the hotel acquire more attentions before opening. Turning to matured hotels, if matured hotels had enough brand awareness, they would use digital marketing to expand the width of their target customers.
Secondly, the way customers acquire knowledge of the product have changed from passively to initiatively. Traditional marketing is the one-off information delivery from hotels to their customers. However, digital marketing provides more opportunities for customers to express their opinions. Customers actively express and exchange information on social media channels. Customers start to share their thoughts and interact with hotels on the internet. These changes promote the digital marketing development.
Thirdly, as costumers become more active, there is a deeper involvement of interactions between brands and customers. It is difficult for traditional marketing to ask customers to engage in hotels’ activities. However, digital marketing can make up for its shortages. The long-term, continuous interaction marketing model allows customers to keep freshness on the brand.
Last but not the least, traditional marketing has more limitations whether for time or costs. Instead of spending money and time on shooting advertisements or publishing articles on magazines, it is better to invite all people to share their own experiences online. Due to a high popularity of TripAdvisor and Qyer, public opinions become a key factor to influence customers’ decisions. Traditional marketing cannot stimulate customer’s desire. On the contrary, digital marketing is more effective to guide customers to purchase brands.
4.4 Customers’ Perspective
4.4.1 Information Gathering Channels
As it is mentioned before, the way customers acquire knowledge of the product have changed from passively to initiatively. Nowadays, customers not only gain information from TV, newspaper, magazines or trade shows, they also can search their interested topics from social channels such as Weibo, search engine etc. The channel that customers use to acquire information is the vital influential factor of adopting marketing strategies. The channels can be divided into traditional methods and digital methods. Customer 2 and 5’s answer show that they acquire information from traditional media. Customer 1 and 4 express their opinions about gaining hotel information on digital channels.
Firstly, no matter customer 2 or 5, they all belong to cooperative business and they acquire hotel information by street banners, radios and trade shows. According to Customer 2, his company has cooperated with the hotel for 6 years. As Manager A mentioned before, hotels prefer to spend high costs on adopting traditional marketing strategy in terms of building the hotel brand. This is the consistent with Customer 2’s answer. Customer 2 was passively found by sales representatives. With putting more investments on traditional channels by the hotel, it is easier for Customer 2 to search and gather hotel information even conducts the background research through TV, radios and banners. When it comes to Customer 5’s explanation, the source of acquiring hotel’s information is different from others. Holding event or trade shows can stimulate prospective customers. As customer 5 said, customers can learn about the hotel’s facts directly. This method is more tangible.
Customer 1 and 4 both reserve the accommodation for tourism purpose. According to their feedbacks, it is found that social channels play important roles in the searching information process. Customer 1’s decision is influenced by the online influencer. Influencers share their staying experiences and hotel information on social media channels. Customers are more likely to read those stories or diary-structured hotel information online. This close-to-life contents make the hotel stand in the customers’ perspective, passing the hotel information to customers by social media channels. Customer 4 considers that digital sites are more convenient and reliable to search information. Getting recommendations from affiliations is not the only factor to impact customers’ decisions. Customers have the right to evaluate the hotel by searching its information rather than only follow their affiliations’ recommendations.
Hence, network not only helps hotels to pass information to their prospective customers, but also provide a search platform to help customers know about hotels. Digital marketing strategies can help create a close-to-life environment for prospective students.
4.4.2 The Influential Factor – Word of Mouth
Word of Mouth marketing is to enable customers to spread product information or brands through the exchanges between their friends or affiliations. At the beginning, WOM is only conducted by familiar people. Until now, people can read reviews from online strangers. There is no doubt that public opinions can boost the hotels’ development. Customer 9 and 10’s answers reflect about the importance of WOM on their purchase decisions.
WOM is the process of guiding customers to complete their purchases. Also, WOM marketing is to accelerate customer’s purchase process. In the information gathering phase, online reviews can stimulate customer’s interest as soon as possible. Customer 9 gathers hotel information from WeChat at the beginning. Due to the interests, she/he starts to read online reviews. Those customers’ reviews are the best support for WOM marketing. Because WOM marketing can enhance customer’s trust and recognition of hotels. Accordingly, it can reduce barriers of customer’s purchase.
The most important stage of WOM is to share user experiences. The EWOM platform is built upon a large number of online reviews by everyone’s contribution. Due to customers’ preference for the internet, prospective customers can be attracted by online community immediately. Hence, their purchase behaviors are easier to be influenced by WOM.
4.4.3 Incentive Program
As Manager C mentioned before, the cost to acquire a new customer is absolutely higher than to retain a customer. Incentive program is the method to help hotels attract and retain customers. Customer 8 gives the example of how incentive program attracts more prospective customers. Customer 3 explains the incentive program used by hotel staff. Also, Customer 5 expresses the reason of choosing this hotel again.
Incentive Program can motivate existed customers to help hotels attract more prospective customers. Sharing user experiences in terms of acquiring incentives is the common method to attract and retain customers. More prospective customers can be attracted by the virial spread. Also, due to acquiring more incentives, it can help hotels to retain their existed customers longer.
Incentive program not only motivates customers, staff can also be motivated. On one hand, getting staff price to stay in the hotel is a reward for employees to work harder and longer. On the other hands, providing opportunities to indirect customers could increase percentage of chance from them to be attracted by this hotel.
According to Customer 5’s answer, business customers may not be able to choose hotels by themselves but by their companies. However, incentive program can help hotels retain those business customers by increasing their demands. While retaining those loyal customers, their relatives also can be attracted by this program. Moreover, according to Customer 8’s answer, marketers have the conscious to integrate digital technologies and incentive programs.
4.5 Marketer’s Expectation
On the basis of five in-depth interviews, all marketers have shown great interests in digital marketing. Although two marketers still focus on traditional method, they still recognize that digital marketing becomes a trend. This paragraph explains the marketer’s expectations on digital marketing strategy.
4.5.1 Low Cost and High ROMI
From marketers’ perspective, digital marketing is the economic method to target their customers more accurately. For some mature hotels, they do not need to spend high costs on traditional marketing. Because they have already had an independent brand images and awareness. Instead of adopting traditional methods, digital marketing can achieve the highest ROMI with the minimum budgets. Due to this situation, manager A mentioned that there were 70% of advertising budgets contribute to digital side in her hotel.
4.5.2 Improve Engagement
Honestly, there are less interactions between hotels and their customers. The social engagement is lower than marketers’ expectations. However, marketers believe digital marketing can ameliorate this circumstance.
The two reasons of low engagements were mentioned by Manager B and E. In the past years, the marketing activities were single and simple. Thus, customers’ participations were low. With the engagement increased, this time-period is for customers to accept digital marketing. During this period, the engagement fluctuates rapidly. If marketers could not understand their target customers properly or adopt a wrong promoting method, it would lead to low customer engagement.
Manager C expresses the importance of customer engagement and Manager A describes the strategy to improve their engagements.
The performance of social engagement is lower than marketers’ expectations. Integrating digital marketing with incentive program can promote and develop customers’ engagement. Better customers’ engagement can maintain customers’ freshness. Meanwhile, developing customers’ engagement can help marketers making an accurate marketing plan by evaluating customers’ feedbacks through the engagement.
As Manager A mentioned before, incentive program motivates customers to become loyalty. To attract and retain more customers, marketers adopt active marketing to retain customers by traditional methods such as conferences or trade shows. Also, by interacting with loyal customers, the second spreading via social media channels can expand the width of target customers. Digital marketing becomes the medium to improve customer engagements.
4.6 Customers’ Situation
4.6.1 Low Social Engagement
Three out of ten customers subscribe hotels’ social channels. The average of customers’ social engagement is relatively low.
Firstly, customers lack consciousness on accessing hotel digital channels. Secondly, customers do not have motivations to interact with hotels on social media channels. Thirdly, most hotels regard Internet as the marketing tool to introduce hotel’s information. It lacks attractions and interactions with customers.
4.6.2 Digital Marketing Consciousness
As it is mentioned before, almost all hotels only export hotel’s information to customers. However, they do not extend customer service, customer relationship management and core business management to digital marketing system. Customer 4 and 5’s answers reflect the imperfection of digital marketing system in the following paragraph.
In customers’ minds, digital marketing is the tool to help marketers transmit information such as special offer or discount to customers. However, if customers were not loyal enough, they would prefer to choose OTA rather than paying attentions on hotel’s digital side. Although digital marketing may not be stronger to influence customers’ direct bookings, it plays a great role in EWOM. As Customer 4’s expressions, before completing the booking, searching is a vital process to influence their decisions. Moreover, EWOM is the influential factor to determine whether customers book the hotel. Digital marketing can help hotels enhance their reputations on the internet in the shortest time.
4.7 The Gap Between Marketer’s and Customer’s Perspective
To summarize, no matter in what kinds of industries, digital marketing has become the mainstream tool. Digital marketing not only can help hotels reduce their budgets, increase return on marketing investment (ROMI), but also it can develop customers’ engagement. Due to those benefits, marketers have great expectations on adopting digital marketing. However, customers’ attitudes toward hotels’ digital marketing are not as good as expected. The average of customers’ engagement is relative low. Also, using digital marketing does not enhance the amount of online direct bookings. It seems that customers are more reliable on OTA or travel agencies. Hence, hotels need to integrate digital marketing into customers’ lives. Making customers more receptive to digital marketing can be reflected on online financial performance directly.
CHAPTER 5: DISCUSSION AND IMPLICATIONS
This study begun with the recognition of Marco environment, tourism booming and the rapid development of hotel industry in China. This study is conducted on the effectiveness of digital and traditional marketing strategy. Dr. Lall and Dr. Das (2016) conducted the similar topic in relation to the comparison of those two strategies. (Das ; Lall, 2016) The researcher will give discussions based on previous findings.
5.2 Discussing the main findings
This section is to compare the findings of this study with other relative existed literatures. With the advent of the network era, Dr. Lall and Dr. Das (2016) conducted the comparisons of traditional and digital marketing. (Das ; Lall, 2016) Besides Dr. Lall ; Dr. Das (2016), many people think that digital marketing has surpassed traditional marketing even replaced its position. (Digital Marketing Strategy, 2018)
This study agrees that digital marketing occupies the leading role, however, traditional marketing has not disappeared. As it is mentioned in “Findings” part, digital marketing definitely brings a lot of benefits whether for increasing hotel revenues, raising ROMI or improving customer engagement. Marketers adopt digital marketing to acquire more target customers. However, traditional marketing is used to build up brand images for forthcoming hotels. From the findings, it indicates that almost all business customers know hotels by traditional methods. It cannot neglect traditional marketing’s contributions in the hotel industry.
In order to attract millennials, hoteliers are to develop digital marketing. With the growth of digital media, Dr. Smith pointed out that more companies adopted digital marketing in terms of attracting more target audiences. (Smith) It is observed that Dr. Smith’s viewpoints are congruent with this study. Although hotels or companies have conscious of driving digital marketing’s development, there is little academic literatures “focused on what types of digital marketing strategies are preferred by millennials and which one influence their behavior.” (Smith, pg.15) Results of this study indicate that digital marketing strategies are more effective than other strategies toward to millennials. Digital marketing outcomes can be reflected on information gathering process and word-of-mouth. No matter customers gather hotel’s information by traditional method or digital method, they all need to do the background search on digital sites. Hence, the effectiveness of digital marketing has a huge impact on their purchase decisions. Turning to WOM, customers not only get suggestions from their neighbors, network becomes their common tools. Hotels can improve their engagement and credibility by managing online reviews.
Digital marketing becomes a trend. Although traditional marketing is not disappeared, its proportion is still decreasing gradually.
5.3 Managerial Implications
As the findings demonstrated, digital marketing and traditional marketing have different functions in the hotel. Among different types of digital marketing strategies, social media strategy and EWOM play vital roles in the comparison of traditional marketing strategy. The following paragraph will put forward a plan to develop and complete digital marketing in the hotel industry in terms of eliminating the existed gap between hotels and customers.
5.3.1 Social Media Strategy
As demonstrated in findings, hotels prefer to use social media channels to do promotions such as WeChat or Weibo. However, the social engagement and interactions with their customers are lower than expectations. It is recommened that hoteliers should establish an entire social media strategy. In details, social media platforms are not only used to deliver promotion news or events to customers, it can be used to address complaints, direct bookings and loyalty programs. Hotels pass a lot of information through social media platforms to their guests, but they do not get any responses from customers. Lacking interactions, customers are easier to lose their attention and interests. Pulling customers is the strategy to increase customer’s initiative. Importantly, marketing managers can start to convert their concepts, trying to integrate digital medias and becoming a strong backup to the hotel.
EWOM is the most important influencial factor of customer’ purchase making. However, EWOM is difficult to be controlled by hotels. As integratity is mentioned before, digital marketing can give the support to develop hotel reputation on the site. EWOM is not a separate entity. Hotel managers are recommended to adopt digital marketing to enhance the influences of EWOM. Moreover, EWOM is the tool to improve social engagment and customer interactions. EWOM can directly reflect the customer satisfaction of hotel services. Reasonable use of customers’ appreciation can improve the popularity of the hotel on the internet.
CHAPTER 6: LIMITATIONS AND RECOMMENDATIONS
6.1 Limitions of the Research
Firstly, this study focuses on analyzing the marketing strategy in 4 or 5 star hotel in China. It is difficult to generatlize the marketing strategy which are used in the whole hotel industry in China.
Secondly, due to the limited timeframe, this research method was conducted by one-by-one interviews. These 15 respondents represent their own viewpoints and ideas. The subjectivity of results on this study is stronger than the objectivity.The limited sampling size can only be representative within the scope of research. The results of this study is less precise than doing bigger sampling size.
Thirdly, doing the analysis of customers’ perspective, all data is generalizable only to millennials. There is no doubt that millennials are more inclined to the internet. Potentially, digital marketing is more advantageous than traditional marketing.
6.2 Recommendations for Future Research
In the future research, there are several areas can be addressed. Firstly, according to the gap between hotel perspective and customer purchase making, the researcher can consider about the influence of hotel marketing strategy on customer purchase behaviors. Secondly, given larger sampling size, the researcher can conduct quantitve analysis to generalize the results in the whole hotel industry in China, providing more accurate data results in the future. Thirdly, the researcher can not only study the comparison of digital and traditional marketing, the integrity of those two marketing strategies can be conducted as well. Last but not the least, according to this study, it is found that OTA dominates by digital side. The researcher can evaluate the gap or comparison between hotel own channels and the third-party websites.
CHAPTER 7: CONCLUSION
With the contiunous debating occurred between traditional and digital marketing, this reseach aims to evaluate a better marketing strategy which is adopted in the hotel industry in China. The literature review describes the top five marketing strategies which are used in the hotel. Moreover, the qualitative research methods provide an in-depth interview from two perspectives. According to data results, it indicates the important role of digital marketing. It suggests that digital marketing is still on the rise. While digital marketing is being improved, hotels’ expectations are also developed. Although digital marketing has a lot of superiorities, traditional marketing cannot be replaced. Combining traditional and digital marketing strategies is the way to enlarge the target group.