Social media marketing for hotels and travel companies

The growing popularity of social media over the last few years has increased the interest of both practitioners and academics on their comm...

The growing popularity of social media over the last few years has increased the interest of both practitioners and academics on their communicative and commercial applications.

The previous analysis of the travel distribution system identified a more and more crowded and competitive environment. Therefore, firms debate, in particular, on the way they can optimize the use of social media in order to communicate with customers, attract prospects, and improve sales.

Observing the various ways travel operators employ social media, it is possible to point out different approaches, moving from very simple and even shallow methods, to more complex, integrated, and pervading ones.

According to our opinion it can be useful to map the different approaches on the basis of two relevant dimensions:

• customers’ degree of engagement;
• level of integration between social media and business strategies.

The degree of engagement has been identified as a variable because it has been recognized to have the power to drive customers’ behaviors (van Doorn et al. 2010; Sashi 2012; Wirtz et al. 2013). Next section will offer a brief overview of the customer engagement concept.

The second variable (level of integration between social media and business strategies) has been identified in order to understand both the extent and the integration within the overall strategic behavior. In some cases, social media represent a key business tool while in some others they are more likely a “must have” rather than really a trusted instrument.

Despite their popularity among customers, firms show generally some difficulties in integrating social media with sales and marketing strategies (i.e., sales and marketing, revenue management) (Varini and Sirsi 2012), as well as with the overall corporate strategy. A survey published by Harvard Business Review (2010) found that a very small part of interviewed companies have formalized social media strategies and, even in those cases, companies report difficulties in integrating them
with the rest of the business strategy.

Even if the literature pointed out that we are far from a real integration of social media and business strategies, research increasingly stress the need of an Integrated Marketing Communication (IMC) approach that includes social media in the communication mix (Mangold and Faulds 2009; Noone et al. 2011; Kimes 2011). Furthermore, the opportunity to real-time learning by social media users helps firms to align their strategies with those of competitors and to improve the overall business strategy.

A Focus on Customer Engagement

Before going on with the analysis of various approaches employed by travel companies to use social media, we believe it is useful to examine in-depth the topic of customer engagement, that results increasingly popular in both academic literature and business reports.

The development of IT, from Web 1.0 to Web 2.0, has generated a change in the way firms communicate with customers on the web: from one-way communication, mainly aimed at giving information, to two-way communication, based on the attempt to create interactions, long-term relationships, and customers’ engagement.

The concept of customer engagement has its theoretical foundations in the service-dominant logic (Vargo and Lush 2004) and its popularity has increased due to recent evolutions of relationship marketing linked to new technologies opportunities. In particular, social media applications allow to easily create relationships with customers (encouraging long-term relationships and loyalty) and with prospects (generating awareness). However, customer engagement extends the traditional concept of relationship marketing (Brodie et al. 2011) and “seems to go beyond awareness, beyond purchase, beyond satisfaction, beyond retention, and beyond loyalty” (Sashi 2012).

Customer engagement can be defined as “a psychological state that occurs by the virtue of interactive, co-creative customer experience with a focal agent/object (e.g., a brand) in focal service relationships” (Brodie et al. 2011). According to van Doorn et al. (2010) and So et al. (2012), customer engagement is the customers’ behavioral manifestation (both positive and negative) toward a brand, product, or firm (beyond purchase) that results from motivational drivers. Therefore, companies that foster customer engagement should focus on “satisfying customers by providing superior value than competitors to build trust and commitment in long-term relationships” between buyers and sellers (Sashi 2012).

The ability of a company to engage consumers can produce some positive effects on business. In fact, engaged customers are more likely to go on participating in the community, they are generally more satisfied and they show higher trust and commitment toward the community (Wirtz et al. 2013). Kumar et al. (2010) argued that customer engagement value depends on four core dimensions: the transactions (customer lifetime value), referring behavior (customer referral value), customer encouragement of other individuals to make a purchase (customer influences value), and feedbacks to the firm for ideas and product improvements and innovation (customer knowledge value).

Therefore, customer engagement affects longevity of customers’ participation, increases satisfaction, and brand loyalty (So et al. 2012) that, in turn, increase positive eWOM in the community and then enhance further community engagement. Moreover, committed members are more likely to develop positive attitudes and behaviors toward the company/brand/product. For example, they can give ideas to improve or create new products or services (Sigala et al. 2012), and to improve brand image and reputation by means of WOM activity; finally, they can become loyal customers and increase purchases.

On the basis of the possible benefits that customer engagement may produce, travel companies should employ the right mix of social media in order to generate customers and prospects engagement.

But how can companies try to stimulate customer engagement? Which are the antecedents of this behavior and psychological state?

Especially, affective commitment (Gustafsson et al. 2005) and social/customization bonds (Zeithaml et al. 2012) can lead to long-term relationships and create engagement. However, the degree of relational exchange and emotional bond between customers and firms and among customers can change over time. We can identify different stages that consumers may undertake to reach engagement (Sashi 2012): connection, interaction, satisfaction, retention, commitment, advocacy, and
engagement (customer engagement cycle). Engagement occurs when both emotional and relational bonds are strong.

Social media offer travel suppliers the opportunity to build emotional bonds and intimate relationships during the conversation engaging both customers and prospects. Some possible actions could be to set up a social network page, to create a corporate blog, to post content on content communities or wikis, to participate in travel blogs and to reply to online reviews, etc. All these activities have different objectives and, if properly managed, can help companies to engage social media users. Results of these practices depend on companies’ ability and commitment toward the creation of emotional and relational bonds with customers and prospects.

social media proposal template

Social Media Approaches

On the basis of the previously mentioned two variables (customers’ degree of engagement and level of integration between social media and business strategies), the following four approaches can be identified to describe how companies employ social media: social media presence, social media projects, call to action, and social CRM. They can be considered as four steps of a continuum that leads companies from social media presence to a fully integrated strategy aimed at learning from customers and creating customer engagement.

Generally the entering stage of a social media strategy is “social media presence.” In this case, companies work on brand awareness and on content-creation to support existing marketing strategies without a full connection to them. Firms in this stage does have not a definite project for each social media and unlikely develop metrics in order to monitor strategies results. A clear example is represented by a firm that has a website and a page on main social media. Considering the statistics analyzed in Sect. 3.5.3 that confirm Facebook to be the dominant social network in both the Web and Mobile, the advisable social media to start with could be Facebook. This approach is mainly informative and promotional. Due to the low level of interactions with social media users and lack of web reputation control, the choice of maintaining only a social media presence for a long period of
time could imply some risks.

An improvement respect to the previous approach is determined by the development of “social media projects” for multiple social media in order to engage users by means of two-way interactions and conversations. Generally, companies in this step develop their own blogs and are more active in connecting various social media. They start monitoring web reputation with some degree of analytics (Facebook Insights, Google analytics, TripAdvisor, etc.), in case replying to online reviews (i.e., TripAdvisor), and improving social customer care.

The third social media approach considers social media as an instrument to “call to action” engaged users. This means ask for their collaboration and driving them to shopping (online or offline). Some travel companies develop contests or special offers, as well as specific “book now” functions that enable customers to book directly in the social media environment by means of a specific plug-in. In this last case, only when users have decided and proceed to book or purchase they will be transferred to the company’s website. This approach considers social media as distribution and communication channels that support and integrate the marketing strategy. Specific offers and pricing policies are studies for each social media over time.

The fourth approach, that we can call “Social CRM,” considers social media and business strategies as fully integrated. Social media are employed to learn about customers and prospects (customer profiling), trying to understand possible opportunities or threats coming from the market. For example, the study of social media consumer-generated information could help travel companies to develop targeted push strategies (promotions and pricing) or to understand the most appropriate distribution channel management strategies. The action of continuous listening and learning allows companies to give real-time responses and services, aligning their strategies with those of competitors. Moreover, this approach gives the opportunity to tune in with customers and prospects needs in order to co-create value.

Despite the increased use of social media by customers, a large part of companies are in the first level of social media strategy. A survey published by Harvard Business Review in 2010 found that 79 % of companies use or plan to use social media. However, the majority of surveyed firms said they are not fully aware of the best ways of using them. A large majority of companies stated that they currently have a social media page (85 %) and that they are using it to promote brands, products, and other service (87 %) or to provide customers a way to interact (76 %). Many organizations view social media as one-way flow marketing messages, instead of a way to create conversations with consumers and prospects. They are searching ways to demonstrate the effectiveness of these instruments but only one quarter of organizations said they monitor the customers that are “talking” about them. Finally, only 23 % use any form of social media analytic tools and only 5 % are using some forms of customer sentiment analysis.

Similar results were also found in the travel industry. Social media are generally considered by managers as instruments to reach customers but rarely they are part of the overall business strategy (Law and Jogaratnam 2005; Law et al. 2008). Moreover, social media pages are used sometimes as promotional instruments rather than as a way to create interaction and engagement. A study conducted by Minazzi and Lagrosen (2013) on Facebook usage among European hotel chains demonstrated a more promotional focus of hotel brands analyzed.

Sometimes the unsureness about return on investment of “social commerce” and measurement difficulties stop investment in social media strategies development and web reputation monitoring. Recent instruments that allow companies with a corporate page to export statistics about their users (e.g., Facebook Insights) help to reduce concern. In the same way, search engines give similar opportunities to track web traffic (e.g., Google analytics).

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