Demystifying performance marketing
A huge proportion of our business comes through performance marketing - nearly half of all new bookers - so it's incredibly important. We've tried to build a real specialism in world-class performance marketing, bringing in many high calibre experts. From combined years of experience that get into three figures, with directors who have specialised in the likes of SEO and email marketing their entire career, to numerous PhD’s on the data science side - they're a hugely competent team.
That level of specialism really enables us to be on top of all the developments in the market, from Google’s technology to emerging channels, and through a deep focus we’re able to help our partners stay ahead too.
Booking.com's performance marketing evolution
I've been at Booking.com for 14 years now, and in that time performance marketing has undergone great change.
In 2005 I was working for a company called Active Hotels, which had been acquired by Priceline Group. Two weeks after I started, Booking.nl was also acquired by the group and a week later marked my first trip to Amsterdam.
Over time the companies combined to become Booking.com - in which I, together with a small team, managed our paid search or PPC (pay per click) activities - where we buy relevant clicks or traffic from search engines and direct them to our website in search of a conversion. Today this has grown to incorporate more teams and marketing activities - all sitting under the umbrella of what we call performance marketing.
It’s really a phrase that's been coined in the last two or three years in the wider marketplace, largely because there's more variety now and there was a need to distinguish between traditional and awareness marketing. Performance marketing at Booking.com is about driving a return on an investment; if we spend X we expect Y out the other side. Data science informs this and we have algorithms doing our bids on an hourly and daily basis to ensure the best bid based on the predicted conversion rate.
We have six different focuses in performance marketing, the first being paid search, predominantly working with Google but also the likes of Bing in the US, Yandex in Russia, Yahoo Japan and local players like China’s Baidu among others. Every time someone clicks on the ads at the top of the search listing, we pay a certain amount based on an auction model - the higher you bid and the more relevant your ad is, the higher your chance of being at the top of the page.
We advertise on what are called upper funnel keywords - things like ‘hotels’ or ‘things to do’ or ‘places to stay’ - down to ‘book a hotel in Amsterdam’, and all the different things a user may search for in between. Our aim is to always be at the top or as close to the top of the page as possible.
We have multinational teams in Amsterdam, Cambridge UK, Manchester UK, Boston US and Shanghai, and from those locations we cover the world, capturing everything from everywhere and manage adverts in 45+ different languages, across all the different parts of a user journey.
The next piece of the performance marketing puzzle is what we call meta search - working with the comparison search engines such as Trivago, TripAdvisor, Kayak and more recently, Google Hotel Ads. This is similar to paid search and we try to do it in as many languages and for as many properties as possible on those sites.
We have search engine optimisation (SEO) specialists focusing on organic traffic, trying to align with that really unique content that guests search for. While SEO has been declining in the broader marketplace, organic traffic has actually grown for us over time as we’ve had the resources to really chase it and produce at scale.
We then have email marketing or marketing messaging. We’re able to reach a huge volume of people, all of whom have either signed up or booked with us, so they are already engaged. Here, there is a balance between raising awareness and creating bookings. Some of the emails we send are just to drive perception around a specific property type for example.
A team called rewards and engagement oversee the likes of ‘refer a friend’ incentives or discount promotions, and then the last piece is the app marketing team, who focus on making the guests journey as seamless as possible through the Booking.com app.
Google clicks year-on-year have been growing, people are still using search, so I can’t see this stopping anytime soon. Social validation - the likes of Instagram - have developed sophisticated advertising business models and will continue to grow and become important channels to target user demand, and as a business we are continually testing and developing in those areas.
Looking ahead, we’re likely to be more mobile focused. Email is moving more towards the likes of app notifications and messaging - communicating with the guest as they want. Data science and machine learning will become increasingly pivotal, and we’ll really be at the heart of those changing market dynamics. Performance marketing will evolve but the core approach - driving more traffic to your listings - will remain.
- There are six teams working on performance marketing at Booking.com: PPC or paid search, meta search, SEO, marketing messaging, rewards and incentives and app marketing
- These teams are based in Amsterdam, Cambridge UK, Manchester UK, Boston US and Shanghai, and manage adverts in 45+ different languages across the user journey
- In the future, mobile and app messaging along with data science and machine learning will be an increasingly important part of the marketing mix