I love the fact that the Internet is finally "getting to sit at the grown-ups table" in the marketing and media world.

• More and more companies are moving a substantial part of their traditional print and broadcast budget to online marketing and media
  
• Many companies are starting to hold their traditional marketing and media to the same measurement standards as online (online had to track and measure to convince the traditional marketers that the Internet was a viable and powerful marketing medium)
  
• Many organizations now realize that they must have an Internet strategy and plan in order to really leverage the medium to it's fullest extent and not damage their brand "to the world" by doing it wrong
  

I love that USDM.net is asked to speak at major national and international conferences and publish books and articles and that we are recognized as leaders in the Interactive world...that's right, the Interactive world.

What's the difference between Internet and Interactive? A world of difference, really. When we say Interactive we mean the entire Interactive program -- from the strategy to the technology, the web site and beyond to handheld devices, etc. Interactive also encompasses the tactics to market online and the online media; the affinity partners and the online public relations; eCommerce and CRM; tracking, measuring and reporting ROI, plus a lot more.

I am delighted to see an interview with me in the press, yet so miffed when we are called "web developers." Web development is but one small -- very small -- part of the whole interactive program.

At USDM.net, we look at the whole picture, as you should too. The entire Interactive program should be embodied in the strategy. It's a big Interactive world and it is getting bigger.

Leah

Posted at 01:45 PM

A recent statistic published by eMarketer.com and attributed to Merrill Lynch, stated that online travel sales are projected to account for 30 percent of all travel sales in 2005, up from 25 percent in 2004 and 21 percent in 2003.

Jupiter believes that online travel sales will hit $91 billion in 2009... one out of every three travel bookings. That's a gigantic 70 percent increase from 2004.

The real news is that the major growth will not come from the big online travel agencies but rather the suppliers own web sites. Their market share in online travel sales is expected to grow a whopping 60%.

What does this mean for DMOs and hotels?
It means that the timing is right to develop a smart, long-term strategy for an Interactive program. Search marketing is key right now, but there are other marketing tactics that are vital to make up the whole online success picture. When we are called in to develop a plan for a DMO or hotel, we always perform a deep assessment and comparison study and set some benchmarks first. A SWOT analysis is vital. We develop the strategic plan after we have the data and analysis we need. It is vital to know how you measure up with your competitive set and how you need to draw the map to get to real online success.

The time is now. DMOs and hotels you can take your share of the online sales. But you have to plan your work and work your plan.

Leah

USDM.net, "Online-Offline Media Budget Allocations and Interactive Technology Drivers," July 21, 2005

Posted at 11:26 AM

Every year we see more tourism, destination and hospitality clients shifting budget dollars toward their interactive programs. We have some clients that spend as little as 5 percent of their total marketing budgets for online initiatives -- and others spend as much as 40 percent.

But in all cases, when clients see results and realize they can measure ROI, they always allocate more to their interactive budgets the next year. The significant shift I see from traditional to online marketing comes when a travel organization really tracks and measures results and compares the two mediums.

For some actual figures on these shifting budgets, travel marketing professionals should check out a recent joint study by NYU and PhoCusWright, "Online Marketing Strategies in the Travel Industry: A Survey of Travel Marketers."¹ The survey respondents were made up of destinations, hotels, tour operators and other travel industry organizations. Hospitality made up 45 percent of the respondents, while destinations accounted for 20 percent.

The report underscores what we have known at USDM.net for years -- a strong Internet marketing strategy delivers results every time. One of the strongly recommended tactics we use, permission-based marketing, has helped USDM.net build a double opt-in traveler database of 120 million Internet users. This is just one of our primary assets in marketing for our clients; we use a total of about 65 different best practices programs wrapped around strategy.

Some key points from the report:

1. The number of marketers who plan on spending 20 percent or more of their marketing budget online this year has doubled.

2. In comparison to 2004, 74 percent of respondents are spending more on Web site design and functionality; 73 percent are increasing spending on e-mail marketing; and 64 percent are spending more on search engine optimization (SEO).

3. Over two-thirds indicated that SEO and e-mail marketing are the most effective online marketing media, and one out of two marketers specified Web site design and functionality as the most successful initiative.

4. When asked to choose the top three trends that will have the most significant impact on future online marketing strategies, respondents overwhelmingly chose the same three: Permission-based e-mail marketing, metasearch, and viral marketing. Powerful Internet marketing strategy when used correctly was chosen as the number one trend.
   

Travel consumers are bombarded with Internet marketing, usually following their first click of the day. Travel suppliers have become savvy as to what online marketing initiatives actually lead to a purchase. The results from PhoCusWright and NYU show there is a significant shift in marketing expenditures under way -- from traditional marketing channels to online strategies and tactics.

The study also confirms that online marketing trends are moving away from banner ads and pop-ups and toward more sophisticated, effective, and measurable methods -- such as Web site design, functionality, search engine optimization and e-mail marketing. The results indicate that the challenge for travel suppliers' online marketing programs is to get in front of the right customer, at the right time, to acquire new customers -- even more than retaining existing ones.

I'm convinced that permission-based e-mail marketing remains the method that will have the most significant impact on future online marketing strategies. And search engines, e-mail marketing, and effective affiliate programs will remain key methods for gaining new customers and extending the reach of any brand online.

I would like to hear your comments on the shift of budget from traditional to online.

Leah

¹ Online Marketing Strategies in the Travel Industry: A Survey of Travel Marketers by New York University And PhoCusWright Inc. Joint Research - 2005

Posted at 11:31 AM

"In the U.S., some $66 billion, or 58%, of leisure and unmanaged business travel will be purchased online in 2005, according to PhoCusWright projections. And that figure climbs to $78.5 billion, or 66%, in 2006."¹ These numbers are not surprising to me, having watched this growth since 1993.

But what does surprise me is that many marketers still don't get it - they don't understand the total impact the Internet has on their business plan. It's amazing to see the numbers of travel marketing executives at hotels, attractions and destination marketing organizations that allocate so little of their budgets to the Internet. And they still want to measure every click, every impression, every little detail to compare it to traditional marketing and advertising -- where you can't measure much at all.

I have always been about measuring all of it. At USDM.net, we benchmark and we measure year over year. In fact, we are strategic partners with three of the top travel organizations in the nation, and our purpose is to help define the metrics that count for the industry.

These metrics are important when executives decide to invest in marketing. I read recently that, this year, more than 50 percent of respondents to a survey of travel marketers said they intended to have a larger online budget in 2005 than they did in 2004 and the number of respondents spending 20 percent or more on Internet marketing has doubled. ² That number increased significantly from last year. In reality, I believe you need online and traditional marketing, advertising, public relations and all forms of the marketing mix that fits your target audiences. But why wouldn't you allocate budget according to the results? Why wouldn't you hold the traditional side of the budget to the same stringent standards you hold the Internet side of the budget to every day? I believe it's because you really cannot measure traditional and you can easily measure so much online.

Some of our clients spend significantly more than 20 percent of their marketing and advertising budget online. Some spend about 20 percent. But whatever they spend, we measure everything about the results -- every click, every impression, every behavior, every conversion, and every search. Of course, we always keep tabs on ROI.

So I have to ask: What is so hard to understand about Internet marketing in the travel industry, and why have so many otherwise smart marketers decided to allocate pennies of the dollar to one of the most effective, measurable accountable mediums for travel marketing?

¹ TravelWeekly.com, "Travel spending surges on the Web, researchers say," May 6, 2005
² Online Marketing Strategies in the Travel Industry: A Survey of Travel Marketers by New York University And PhoCusWright Inc. Joint Research - 2005