Thursday, December 20, 2007


The Long Tail phenomenon


This concept was first described by Chris Anderson in 2004 in Wired Magazine to describe some business models such as Amazon or Netflix. It has completely changed the view on the revenue sources in entertainment business.

Anderson argued that not only popular hit products contribute to company’s revenue, but also the non popular downstream products, moreover they can bring more cash and sometimes the volumes of their sales exceed those of the bestsellers.


This is true for the businesses where distribution costs and inventory store are of a little significance. The Long Tail thus without no additional costs serves the small niches. This is mostly applicable for Web-business or mass market retailers.

The Long Tail phenomenon can also be applicable in terms of distribution channels, where small niche target sites can in volume better sell you product that big sites, or advertisers, like Google who gains more money from the small advertisers.

‘Popularity no longer has a monopoly on profitability’

In Long Tail the main principle is make everything available, discovering new markets and expanding them. There are no extra costs, geographical position is of no matter anymore, so even if there just few customers out there, make the product available, adapt to personal tastes and use the strategy of mass customizations.


The Long Tale phenomenon is a threat to physical but I think in long term, the can still be safe for couple of years from now, people not familiar with Internet will still go there to search for blockbusters. But when the new generation will arrive, they can easily replace the physical stores. There is also threat of new entrants that will create the similar Long Term models online, but the sites like Amazon have a great notoriety, so it will be difficult to replace them.

The Long Tail phenomenon a great opportunity for ones and a major threat for the others shows us one more time that the business world is constantly evolving, and that to stay in business one should be proactive.

Here you can find some studies related to the long tail phenomenon.


Monday, April 30, 2007

Second part of the Final Exam



1) Social sharing sites

The world is always on the move, and the Internet has revolutionized the marketing techniques for many companies. We live in the times when “virtual becomes real”. People are more and more familiar with utilization of the Internet and with what’s going on there. The new generation acquires this knowledge from their childhood. People demand and share information. The travel sector has had a great influence of this ‘sharing’ trend. The travel 1.0 was price driven. The travel 2.0 have made it possible to easily compare the price as well as added other significant factors for comparison. People are looking for better experience.

Social sharing sites are the sites where people, individuals, organization, associations can share their ideas, videos, pictures, opinions, experiences, news, etc. This are really interactive sites, where people can link to each others site, create cross links, forums etc. The most popular is MySpace, an online community that lets people meet their friends' friends. It allows share photos, journals and interests. Mer personally I use LiveJournal, as all Russian people use it.

I have already written in my blog before about social networking sites, and the Social Networking 3.0, that people start talking about. So I will recopy a party of this post, since I have found a lot of interesting information

Nowadays, we talk about the third generation of social-networking technology has hit the Web, and it's about content as much as contacts.

The idea of social sharing sites at the beginning was to let users build online profiles that advertised their interests and to help them connect with friends and friends-of-friends around one of those interests -- whether it be finding a job, making a sale, or repairing an old motorcycle.

Not so popular at the beginning, now it has become a real business. Now members are using their networks for practical purposes, like finding job candidates, locating business and legal services, coordinating group activities, promoting its company, association or organization. It connects people and it has become really a personal media, and it is free!!!

iMeem, relatively new social network company hopes to attract members by building all their activities not around a virtual representation of their social network, but around instant messaging technology. Indeed, the company's name is a combination of IM, for instant messaging, and "meme," meaning an idea spreading through a network. In terms of technology use they are leapfrogging all the older competition.

iMeem is built around a buddy-list window that shows a user which of her friends are online. From that window, she can send and receive instant messages, join group chats, keep a blog, and share photos, videos, podcasts, playlists, and the like with other users using a peer-to-peer system related to the technology behind the original Napster.

Wikipedia gives a list of social networking sites.

2) The influence on the customer's choice.

The customer now is much more informed, it can compare more easily and doesn’t want to be cheated. Customers want more experience at a lower price. Companies are obliged to adapt as to what a customer wants, who is now a master and is imposing the rules of the game.

The companies have to be completely transparent and create the customer confidence.
The challenge now is not only get customers to try your product, but also make them loyal, as the customer tends to switch the brands more often than before. The customer is more prudent than before, they check travel sites 35 times over 90 days before they book. They want to be sure of what they are buying before they chose.

Customers become more and more of the marketing tactics, so for them and independent opinion (word of mouth) worth much more than the advertising.

Marketing segments are dead. Customers are gathering by their interests and hobbies. They are empowered as never before. This article supports this assessment.

Actually I was looking through a bunch of article that you can find them all here.

3) What can hoteliers do?

Hoteliers can integrate to social networking in their business sites. To enhance the image, be more customer-oriented, has an immediate honest customer feedback, to constantly improve the quality. The enterprise transparency is essential in today business world. Companies can create forum, video, picture and experience exchange.

But first of all, hoteliers must accept the reality of the power of the consumer to control the selection and purchase of all travel industry products.

Second, in the words of Joseph Buhler of The New York Times: accept, embrace, innovate, join. Those who do not take this position will probably not survive!

Third, become acquainted with the process; don’t defer management, knowledge and participation solely to the IT staff.

Try to integrate following techniques: Blog, podcasts, RSS feed, C2C, Travel 2.0 , know what social Networking sites your customers use.

People now share their plans and dreams of travel, for example. This interactive process of the online travel community will continue to grow as the consumer’s power of communicating conditions the offering of the travel product.

Interactive management of technological tools by the consumer is indispensable for the when, where, why and how of the travel experience. According to PhoCusWright, technology is easy; management of it by the consumer has change the face and usage of the Internet to dreaming, planning and sharing opinions about the potential destination.

Hoteliers can also use buzz marketing, as in create different videos, imagine stories , curious ouctures, maybe even anekdotes or cartoon movies and put it on the internet. It should be something cusious or funny so that people are going to send it to each other on the chain letter.


TripAdviser (get the truth, then go) and Gusto (travel + lifestyle) have already understood this.
Tablet Hotels have real-time customer ratings.
Who is who in hospitality, a valuable online networking platform for the hospitality industry
The Hoxton Hotels who allow customers to leave their feedback.


4. Can hotels effectively establish an online conversation with customers?

Hoteliers have to understand that social networking sites and technical tools create wonderful opportunities for them to get their message to the people who are most likely to buy their products, as well as it creates of course a lot of challenges. Hoteliers should look for the social networking sites that reach just the customers needed and communicate with them.

Another thing they could do is that they can set up the alarms to be informed of anytime that the hotel was mentioned. And if the negative feedback is found good managers will try to correct the mistake. You were telling us the example during the class when manager corrected the mistake, and then the person who was claiming wrote about the fact that he was offered recompense. This creates a really positive opinion.

The Web 2.0 and social networking appears to be a solution that will bring about the greatest possible efficiency to marketing and advertising spending. It is bringing user-generated content to the Web site. As I have already mentioned that before, the customers become impervious to traditional media. Over one-third of social networkers spend less time watching television and reading newspapers and magazines. The peers’ opinion becomes more important than any other source of information.

The social networks have a huge power. It is a kind of a new "door" for advertisers to enter where they can find a discrete, highly-targeted slice of the population to which their advertising messages would have the most appeal and would most likely result in their products being purchased. The challenge here is to "identify the social networking sites whose 'communities' of visitors closely match the profile of their target customers and prospects."

Sure all that takes a lot of time, but the market is already responding to this need, and the first outsoursing comapnies star appear that will do the analysis for the hotels.

Another effective way is to integrate the possibility of social networking within your proper site. It enhances image of the transparent company and allows even more leverage the advertising budget.

P.S. Just for you to now, I have had a lots of technical problems of posting this blog. There was really a mess with all this links, Blogger has a lots of bugs, it was deleting parts of my text and mixting up the links.

Saturday, April 21, 2007

Dear Liz,

I have been working with Anna Godefroy, but I have forgotten to post it on my blog. You can see our work and the time of posting on her blog. Nethertheless, I will post it here the copy too.

KUBEHOTEL

avantgardehotels.com

Reach

The site focuses on modern and sophisticated travelers with requirements for a high quality and high-tech facilitiesProposes to download Avantgard toolbar and e-mail newsletters in order to have a constant and real-time interactivity with the end userThe site appears on the 1st page of the Yahoo search at the search terms "design hotel". As to the Google, the Kubehotel is on the first lines itself when the "design hotel" search words are used. So, the Avantgardehotels.com could be good for the Kubehotel as to american and english-speaking audience.We have found no concrete numbers as to the customers’ reach; we suppose that we should ask them to send the presentation.Only Translated into French, Spanish, Italian, and German.

Image

Contemporary trend-setting design concept hotelsPromotes the image of innovative hotels where extra coolness comes as a standard, artistic touchThe site represents a very limited number of properties (80 hotels in 70 destinations), thus very selective siteIn France only 4 hotels presented

Forward distribution

Can also be booked on the Avangard’s toll-free number, by e-mail and travel agencies can book on the GDSNo forward distribution found but the site invites everyone to put Avantgardhotels’ linked logo on their sites

hotelclub.net

Reach

Multi-national site, more than 10 languages availableMore than 4.7 million unique visitors per monthTwo types of bookings: lastminute and planed, thus different customers (business and leisure customers),Price-sensitive customersRSS feature – increases the frequency of browsing

Image

Site represents a wide selection of accommodation, from one to five stars, from motels to luxury and apartments (25000 in 120 countries)general site which stresses the possibility of big discounts, up to 60%

Forward distribution

Developed affiliate program, 50% net commission earned on each booking – possibility to control the commission by the means of the discounted rated provided, 100 days visitors tracking, comprehensive reporting, possibility to chose the product, help in building the brand, lastminute affiliate programTravel agencies programs – Up to 20% disounts from already discounted Hotel Club rates, integration of the booking engine into the agency’s website, etc.

minotel.com

Reach

Target markets are the United States, Canada, Japan, China, Great Britain, Germany and Switzerland. Business customers.Key words in the meta search do not match our concept.

Image

Minotel unites small capacity 3-4 star hotels which are big for their consistency, their quality and their authenticity. Designed for family-owned and -managed hotels at a moderate price. Cozy and friendly atmosphere and personalized service.

Forward distribution

The site has a very diversified and well developed forward distribution system: tour operators, travel agencies, GDS, IDS, electronic distributors, and site partners with commissionable links. No affiliate programs though. The site has its own special attractive voucher program and other special promotions.Our hotel will be presented on our web site Minotel.com on at least three screen pages comprising photos and texts in several languages. Furthermore, our hotel will be featured in more than 20 million brochures and hotel guides which are producted and distributed each year on all five continents by our network of more than 150 tour operators.The hotel will be part of various packages or specially targeted offers aimed at a large individual clientele.Reservation confirmed in writing by one of their reservation offices is guaranteed and reimbursed in case of cancellation. In addition to the promotion made for your hotel through Minotel’s commercial service, the publication in our hotel guides generates a walk-in clientele, contacting you directly and paying for their stay on the spot, at your indicated tariff.

CONCLUSION

We have found out that the sites’ quality is very different: the Minotel is very well developed and the least developed is the Avantgardhotels site. As the amount of information provided on the distributor’s sites is not equivalent, it was impossible to do a fare comparison. That’s why we had to do some assumptions.

Our strategy is to choose an agency in the “Long Tail”. We strongly believe that in our case it is extremely important to promote our image, as our hotel in a conceptual one, and we don’t want it to be associated with non-conceptual hotels. We have really specific customers: modern travelers,

Avantgardhotels.com has little but very specific coverage, just what we are looking for. We assume that the reach – cost ratio is favorable. At the same time, the site promotes only 70 hotels, with only 4 hotels in France. The image corresponds perfectly to our image. Among the three sites this one seems to be the most appropriate, however we need to do further investigation (by phone) to find out more about their coverage (this information is not very clear on the site). We know though that it is translated into 5 languages, which is good for us as they cover more countries than us.

Hotelclub.com rather big coverage, though too general and have all sorts of accommodation in its database. Very expensive, the discounts are too high.

Minotel.com – as to our estimation, it is generally speaking the best of the three reseller sites we have analysed. However, it does not fit our concept and target and consequently will not provide a good stream of customers. This site would fit perfectly to the base2stay hotel.

Friday, April 20, 2007

Commentary to Chloe's blog

Chloe has found a really interesting article concerning new concept of hotel in the Airport. This hotel is intended for the people who take transfers or got the flight delayed and need just couple of hours of sleep. I find this idea great, because I travel a lot and I’ve been always thinking that that kind of place in the airport should exist. I so much don’t like to sleep in the chair, always worrying about your bag and being intimidated by other people. I’m sure there is a real need of this hotel in the market, and it will be very popular!
Social Networking 3.0

A social network - is a kind od structure made of individuals or organizations that are tied by one or more specific types of relations, such as financial exchange, friendship, hate, trade, web links, hobbies, etc
In the Internet there exists a bunch of sites that propose to create social networks online:
myspace.com, secondlife.com, livejournal.com, facebook.com, etc…

Now we talk about the third generation of social-networking technology has hit the Web, and it's about content as much as contacts.

Read this article, that talks more in detail about it :
The idea of these companies was at the beginning to let users build online profiles that advertised their interests and to help them connect with friends and friends-of-friends around one of those interests -- whether it be finding a job, making a sale, or repairing an old motorcycle.
Not so popular at the beginning, now it has become a real business.
Now members are using their networks for practical purposes, like finding job candidates, locating business and legal services, coordinating group activities, promoting its company, association or organization. It connects people and it has become really a personal media, and it is free!!! People share opinions, pictures and videos.
iMeem, relatively new social network company hopes to attract members by building all their activities not around a virtual representation of their social network, but around instant messaging technology. Indeed, the company's name is a combination of IM, for instant messaging, and "meme," meaning an idea spreading through a network. In terms of technology use they are leapfrogging all the older competition.
iMeem is built around a buddy-list window that shows a user which of her friends are online. From that window, she can send and receive instant messages, join group chats, keep a blog, and share photos, videos, podcasts, playlists, and the like with other users using a peer-to-peer system related to the technology behind the original Napster.
I think it really has a future, because there are so many programs out there, computer is overloaded, people have to long on to so many things. Whereas if we will have all-in one it would just be great!

Friday, April 06, 2007

M2B mobile travel technology

Since we talk about mobile distribution, I have decided to comment on both articles that I’ve used during research: “Asia is ready for mobile travel technologies” as well as “Assessing the potential of mobile travel services in Asia”.

Both of the articles argue that it is Asia that is targeted for this distribution channel. It is promising market, with almost billion mobile subscribers, the number that grows by 20% annually. People are constantly on-the-go and quite often have no time to get to PC. They have the most advance mobile infrastructure.

Different marketing activities to encourage the usage of these channels should now be undertaken by travel suppliers and intermediaries. As well as the technology utilized should be adapted to each market.

These will help to increase customer satisfaction, differentiate from the competitors and increase sales.

I think that this channel has a lot of perspectives, and I agree that especially in Asia for the moment, where people are more acquainted with advanced technologies, there is huge market of subscribers, and a lot of businessman. Eventually this market will come to Europe too.
The comment on Alexander’s blog


The article “A real-world travel agency that books virtual-world travel packages” is really interesting as it shows that Internet traveling goes all beyond our imagination and that people are ready to book online the virtual tours! Still it’s possible, and the second life has proven it by its success, where people really live their second life, fond the families, go to bars and restaurants, make their business. So why not develop virtual traveling?
I think that Synthravels got it right and on time, and they will skim the milk, very smart!
Although I am really against all virtual friendships, or love stories and I prefer real life, I know that there are lots of people that for different reason are stuck in virtual life.

Thursday, April 05, 2007

Hotel Affiliate Programs

What are hotel affiliate programs? How do they work? Where do they fit in the distribution channels?

Hotel affiliate program fits into modern trend of affiliate marketing. An affiliate is rewarded for every visitor, or subscriber, or a customers, and as well as all the sales provided through his effort is rewarded. There are different types of the compensation or commission, e.g. based on a certain value for each Impression (CPM), click (Pay per click), registrant or new customer (Pay per lead) or (Cost Per Acquisition / CPA), sale (usually a percentage, Pay per sale or revenue share), or any combination of them.
It’s a ‘pay for performance model’, meaning there is nothing paid to affiliate, until there is a result, besides for the initial setup.
The hotels also start using these programs:
Hotels.com: http://www.ian.com/, a division of Hotels.com. They have a real expertise in these fields, and provide the partners with cutting edge technology, highly competitive travel products from all the domains and industry leading support, such as University, 24/7 global call center sales and Customer Care Support, highly trained Account Managers to answer any questions you may have, Search Engine Optimization support, Online Statistic package.

Mobile Role in Hotel Distribution



1. Research: find 2 channels for mobile hotel distribution

1) www.lastminute.com
2) www.02.ie/i-mode

2. How do they work?
For the lastminute.com you have a possibility to browse their tickets, flights, and holidays from the handset. There is also a service of SMS deal and flight alerts/
02 is a leading provider of mobile services, offering communications solutions to customers and corporates in Ireland and the UK. They have recently introduces i-mode mobile service, with the help of which a user have an access to a huge range of the top websites at the touch of the mobile button. There are lots pf categories, and one of them is Travel. This service allows to browse, book, and buy the ticket, flight, or a journey.
It includes the site such as Aer Araan, ArgusCarHire.com, eBookers, GoHop.ie, Hostelworld.com, lastminute.com, MyHoliday.ie, Worldres.com

3. How does a hotel participate?
Some hotels are launching their own direct mobile booking services, like Malmaison Hotels, which makes the real-time end-to-end reservations possible via mobile. The service works across all mobile operator networks and on virtually all mobile handsets and devices.
But for the moment it’s mostly the travel suppliers and intermediaries that start introducing more and more mobile services in order to differentiate.

Wednesday, April 04, 2007



Disappearing front desk




This article describes the new tendency of replacing the old-fashioned front desks with those that resemble tables, podiums, information desks at the mall, and other alternative ways. This is done to add a ‘modern’ wave to hotel, reduce the lines and increase customer satisfaction. One of the peculiarities of this new tendency is to make the clerks more flexible, so that they can leave their desk, or even give them electronic tablets to remove the desk completely.
In addition new electronic kiosks are introduced that allow them check-in without ever talking to a hotel employee.
I think it is a good idea to implement new front desk strategies in your hotel, to stay up-to-date, still kipping in mind that the changes in customer habits will take time, and still the majority prefers old-fashioned face-to face contact, and no new technologies could replace it. The best way out is to have contingent and coherent mixed style.

Friday, March 23, 2007

“Hotel California” Eagles



Some people knew a long time ago how to create a buzz…
Read this curious article about how one smart hotelier created a buzz: a rumor that it was his hotel that the legendary song was talking about and create whole business around it.
Well, done even those most probably it’s not true!
Opaque Sites

So the opaque websites its different from others OTA, unlike “transparent” travel sites such as Expedia.com and Orbitz.com — which identify the service providers with whom you’re dealing — opaque sites like Hotwire.com and Priceline.com won’t tell you the company you’re doing business with until you enter your credit- or debit-card number. By then, what you see is what you got: Everything is final, with no refunds or exchanges.If you don’t mind flying blind, purchasing your travel needs from an “opaque” Web site could save you a bundle.To read the whole article click here