[CoStar] Shift focus on your hotel’s digital spend and marketing mindset

By Leora Halpern Lanz
HNN columnist

Published version in CoStar– Full article below:

As hoteliers enter the critical phase of budget planning, it’s imperative to scrutinize where digital marketing dollars are allocated and what outcomes they drive. With a myriad of platforms and strategies available, it’s easy to spread the budget thin without reaping significant returns. The fear of missing out (FOMO) often leads to investments in secondary and even tertiary channels, like social media and influencer marketing, simply because “everyone else is doing it.” While presence on these platforms can feel essential, particularly for some hotel classifications more than others, or to reach certain demographics more readily, the key question remains: Is this truly delivering the desired results?

Time for a Strategic Shift: The 2025 budget should mark a shift towards a more discerning approach, where every dollar is strategically allocated to align with your hotel’s classification, segment, and customer base. It’s time to critically evaluate whether the investment in social media and influencer marketing is yielding the best return on investment (ROI). Vanity metrics such as “likes,” “followers,” and engagement look great on reports, but do they translate into actual bookings? Is this the year to explore more meaningful metrics that better align with your hotels’ strategic goals. Could it be that 2025 is the year to flip the digital marketing mindset?

For instance, if we spend less on content production, and instead spend more on the distribution of that content to our targeted audiences, we can help break through the clutter of messaging. If we consider less investment in the very popular platform of paid social advertising, and spend more in PPC (pay per click or paid search), which presents a more effective and targeted distribution, can we help ourselves focus the messaging to appropriate market segments?

“The days of social media KPIs only being about ‘likes’ and ‘shares’ are long gone,” says JoAnne Borselli, Group Brand Director at Boston-Based Connelly Partners (CP). “Social channels are now where the vast majority of Millennial and Gen Z travelers go for trip inspiration and for booking. So I think for social specifically, it’s about how you’re targeting your audience, how you’re using the channel and how you’re measuring success.”

“It’s important to fuel the modes that are working,” says Scott Savitt, Senior Partner and Chief Digital Officer at Connelly Partners (CP). “Hotels need to understand media attribution to fully realize how to optimize the channel mix for the best results.”

The desire to increase spend in influencer marketing is understandable; this emerging and powerful outlet has become a business line for the content creators and a form of third-party endorsement and “celebrity” for businesses. I would argue that a limited-service hotel need not spend as much as a luxury or lifestyle property for example, when there are other channels that prove successful.

Social Media Spending. Are Your Dollars Driving Conversions?
 Social media continues to dominate marketing budgets, so it is important to analyze and determine if these investments translate into bookings. Data from Tambourine (2023) suggests that social media accounts for approximately 29% of direct booking budgets yet contributes to only 1% of total marketing revenue. This discrepancy raises a crucial question: Are we focusing too much on content production and not enough on targeted distribution of this content?

Keep in mind, when people look for hotels online, (including Gen Z and Millennials) the first stop is a Google search. The consumer might then check the social channels, the Google My Business pages, text ads. Should prioritizing digital spend with limited dollars turn to paid search and pay per click advertising, to boost visibility on those search engine results pages? These would be “lower funnel tactics,” says Savitt, referring to methods to bring the customer closer to booking.

By reallocating funds from content production to more targeted distribution channels, such as pay-per-click (PPC) advertising, hotels can achieve greater market penetration and even saturation. This approach allows for more precise messaging that resonates with specific market segments, ultimately driving conversions. It’s time to rethink the marketing mindset and focus on efficiency and effectiveness.

For limited-service hotels, the necessity of social media spending should be assessed. Would these funds be better spent on more targeted and trackable paid search campaigns? The goal isn’t to join the pack but to stand out through strategic differentiation. Just because “everyone is there” doesn’t mean we have to be there if it isn’t meaningful for our branding and strategy.

It is not uncommon to hear “we can handle ‘doing’ social; it doesn’t cost us anything, and one of our salespeople or concierge staff can create and share daily posts.” But if we are using staff time to create and post messages that are random and not strategic or on brand, perhaps a better use of the staff time is to connect with visitors and create the memorable experiences for which guests are paying.

Similarly, when hotels claim they have no resources for social media, and they do not know what story to tell, then consider the tools that already work for you and boost those efforts further rather than “just dipping toes in the water” with social media efforts. “Something” is not necessarily better than “nothing” in this case. Aligning Social Media Strategies with Clear Business Objectives: According to Milestone Inc CEO Anil Aggarwal, “because a select service hotel is more focused on driving revenue, it should consider spending more money on strategies that lead to ‘bottom of funnel’ traffic and conversion. Such strategies would include paid advertising, optimization of local listings, and content creation that leads to bookings.

“If you have an upscale hotel, then it’s key to define what the marketing goals are. If the goals continue to be revenue-focused, then the hotel still needs to aim for “bottom of funnel” although they can go broader as the budgets are likely higher,” adds Aggarwal. “However, if it’s a new upscale hotel that desires an increase in awareness, then social media has a play. The most effective social media strategy is to spend on social media advertising. Content marketing on social media channels does create engagement but has very limited visibility until the hotel devotes budget and dollars on advertising spend.” Milestone recently collaborated with HSMAI to provide a guidebook for effective digital presence for the next few years.

Consider a large convention hotel in a primary market. If the hotel targets the leisure segment, social messaging should reach feeder markets both domestically and internationally. However, if the focus is on food and beverage (F&B) offerings, local geotargeting is more effective. For weddings, a regional reach may be required, coupled with newly engaged targeting parameters (pun intended). In each of these scenarios, a paid strategy is required. A general social media post (unpaid) may not ensure that the right people see the right message at the right time, making those marketing efforts inefficient. Targeted social campaigns are essential when aligning strategies to clear business objectives.

“The truth is, targeting parameters inside of social media are incredibly powerful. But few hoteliers are intimately familiar with those parameters. It’s quite simply an education issue,” says Paige Bloom, director of content marketing at Tambourine. “If you don’t know what’s possible in paid social, you’re not going to include that in your strategy and you’re not going to budget for it. Instead, you’re going to continue to do what you know. That’s what leads to increased investment in content and less into the paid strategies to distribute that content.”

According to Tambourine data, almost 45% of social media marketing budgets go to content creation. Only 14% of that budget goes to the paid distribution of that content.

“Additionally, you need to consider demand,” says CP’s Borselli. If you only focus on lower funnel tactics, eventually your upper funnel (awareness) demand dries up and you’re only tracking folks who know you already and who would have made a booking anyway. You lose the ability to generate incremental bookings – which is ultimately what we’re always trying to do. Hoteliers can be tricked into thinking PPC is super effective – because it is – but there is a percentage of those people who would have booked anyway; they simply clicked on the paid listing instead of the organic one.

“That’s not a booking that should be technically counted from a KPI perspective, and it’s really difficult for most hotels to quantify incremental bookings with an adequate level of confidence. We used to wrestle with that situation a lot when I worked with a particular brand. Internal stakeholders are often impressed by PPC-generated revenue because it looks so effective. I’m not implying that PPC isn’t important. It’s critical and you need to ensure you’re properly funded in that channel. It’s just not the only place to invest if you need to drive increased awareness of your property. At the end of the day, it’s about balancing upper and lower funnel within the constraints of your budget. The answer is never clear.”

Is investment in in-house content creation a good idea?
Consider the luxury lifestyle hotel, which has three F&B outlets, a coffee shop, and a rooftop pool. This hotel might find it necessary to hire an in-house or on-property social media marketing person to generate content across for these segments. Keep in mind, the role requires a vast skillset: photography, videography, content strategy, digital marketing, paid performance, copywriting, public and press relations, and customer service. Finding this perfect person is already a challenge. As I’ve seen, such individuals are typically hired for their social media creative, photo capabilities, and focus on content, not necessarily for an expertise in paid distribution.

The alternative to in-house or on-property content creation, is to retain an agency, which will charge a premium for content. This agency will be tasked with posting several times per week. To keep up with these content demands, the agency will require between 150-250 posts per year. That means more content shoots, driving the cost of social up. The cost of this content will almost certainly guarantee a negligible investment in paid media.

Can there be a healthy balance? What if this hotel strategically invested in one piece of exceptional content per vertical? One piece of content for leisure, one for each F&B outlet, one for the rooftop. And then to focus on distributing that single piece of content over the course of three months, six months, a year?

“We see click-through rates and engagement nearly double when the focus is on producing a great piece of content,” says Tambourine’s Bloom. “Paid efforts are either amplified or hindered based on the quality of content. Poor content can cost you more in the long run.”

Hoteliers want volume of content and volume of posts. That’s what keeps the content costs high and the paid media investment low. But there is a valuable lesson in here: Less is More. Invest in a few strategic, on-brand pieces of content and distribute them through targeted paid advertising to reach a larger, more relevant audience. This approach allows for a direct connection between marketing efforts and business objectives, whether the focus is on leisure guests, restaurant patrons, or spa-goers, etc.

Influencer Marketing: Is It Worth the Investment for Your Hotel?
The influencer marketing industry has grown exponentially, but it’s important to assess whether this investment is driving actual business. Are your influencer partnerships resulting in bookings, or are they generating buzz without follow-through?

During my time teaching Boston University students in France in 2022, I observed that marketers at Paris’s “palace hotels” referred to influencer marketing as “digital marketing.” This highlighted the significant role influencers play in the marketing strategies of luxury and lifestyle hotels. However, for me, the value of influencer marketing for limited-service hotels is
less clear.

Hoteliers typically engage with influencers in two ways: to gather content and to leverage the influencer audience for exposure. For limited-service hotels, gathering content can be an uphill
battle. The hotel may not have the visual story to support social. So, what is the expectation? There are certain realities that hoteliers should understand. Be aware of the influencer accounts overtaken by fraudulent followers; look at the influencer engagement with their audiences to see if there’s a true relationship there. And sometimes, the content an influencer might showcase on their own account is not the content they will produce for your hotel.

Yet leveraging influencers can prove extraordinarily effective. In the case of a hotel hosting influencers for a launch of a new restaurant, similar to a traditional press event, the hotel can gain new content, hyper-local awareness and general publicity. If the awareness leads to bookings, great. This example emphasizes the importance of aligning influencer partnerships with the hotel’s target market and continually tracking campaign performance.

Embracing Artificial Intelligence (AI): The Future of Hotel Marketing.
Now is a time to invest in experimentation of AI for newer and more effective digital marketing possibilities. AI offers numerous opportunities to optimize marketing efforts, making them more efficient. From analyzing past social media posts to determine the best-performing content to suggesting optimal times to post, AI tools can help hotels maximize their digital presence. It’s time to explore AI-driven options and enhance digital marketing spend.

Tom McDermott at hospitality digital marketing agency Tambourine shares that “AI can also improve customer interactions through chatbots that provide instant responses to potential guests, answering common questions and guiding them through the booking process. This reduces the chances of losing a booking due to slow response times. Additionally, AI tools can enhance marketing photography by automatically editing images, suggesting the best compositions, and even generating high-quality visuals from scratch.”

Milestone’s Aggarwal adds, “creation of content using AI is our lowest hanging fruit. It can offer an immediate efficiency with these helpful technological tools. Hotels should also use AI as ‘agents’ for trip planning and developing itineraries. Internally, it can help with pricing strategies and optimizing your website for search and discovery.”

For example, if a branded hotel chain “implemented AI chatbots on their website and social media channels, these tools can handle inquiries 24/7, providing personalized recommendations and significantly reducing bounce rates on booking pages, leading to an increase in completed bookings,” says Aggarwal.

A Call to Action: Rethink, Reallocate, and Refocus.
Though not an exhaustive list of digital assets, and considerations — there’s also personalization efforts, working with the alwaysevolving and challenging world of OTA presence (which now also relies on excellence in customer experience for positioning), and website and search optimization — these areas can provide hoteliers some food for thought for budget planning. As the market becomes increasingly competitive and noisy, hoteliers must adopt a data-driven, conversion-focused approach to digital marketing. It’s not too late to adjust plans for the year ahead. By reevaluating the effectiveness of your digital spend and prioritizing channels that align with your business goals, you can ensure that every dollar spent drives meaningful results.

As Savitt summarizes, “Hoteliers are facing critical shifts they must embrace — moving from
broad, less or ineffective digital marketing efforts, toward more precise and measurable ROIdriven strategies. The call to rethink digital spending, particularly in favor of targeted PPC, and
paid social advertising, is timely and necessary. It’s not about chasing trends but ensuring that
every marketing dollar serves a strategic purpose.” Consider flipping the mindset.

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