Google's "Comeback" in 2012

Only in a technological landscape moving as quickly as ours could Google be considered an underdog. But, for the better part of the last two years, it has often seemed that way. Common signals of doubt included questions like these: Would Google be boxed out by Facebook? Would the popularity of the iPhone and Apple's semi-closed ecosystem limit Google's ability to grow? Would Google be able to learn from its own failures and bring viable services to social and mobile?

My opinion: 2012 will be the year when Google stops chasing its tail, so to speak, and begins to lay down a solid foundation that will lead to a renewed emergence as a primary social, marketing, commerce, and mobile player. I believe the impact of this resurgence will be particularly strong in the world of hotels and restaurants.

The Big Picture
The headline is that Google is pruning their broad set of services and bringing a new concentrated focus towards integration with +1, Google+, YouTube, Maps, and Gmail. The result is that consumers are beginning to recognize Google as something that operates more as a unified personalized service.

We generally tend to consider a specific website (like www.facebook.com) to be the logical home for such various services. Google is increasingly going beyond that concept however, and instead using devices as the assumed point of coalescence. Android phones are a one-stop shop for Google services. We don't necessarily need a particular website or any one specific mobile app. Instead, we ask (via voice or type) for something and the phone selects the correct website or app to support the desired action (gain information, navigate, review, talk with friends, comparison shop, etc). We can see the same concept being applied (with somewhat less market acceptance) via Google's Chromebooks, and (with different objectives) via Apple's Siri. The end result, on Android, however, is that everything goes through Google and the value that consumes get from them is increasing. More so than any advancement within a specific service, it is this coalescence of Google's services that will yield success this year.

What is interesting to me is that this significant uptick in utility is being driven to both consumers and brands. As Google rolls out more social and commerce services, they are able to bring those data points into their Analytics offering. For the first time, this will enable brands to see closed loop reporting on social media activities, for example (via Google+), and beginning to make informed estimates on social media ROI. While Facebook began with people and then followed with brands, I predict that Google+ will generally lead with the brands (who have much to gain via single-source 360 degree reporting) and the people/consumers will follow them. More so than any other platform, I believe that Google will be responsible for accelerating the shift of marketing spend from traditional areas to social, mobile, and other emerging areas -- simply because it will be the first to enable activity and measurement in these various channels.

How does this affect Hotels and Restaurants?
Google made a very shrewd move in 2011 when it decided to no longer include reviews from other platforms in its Maps/Places listings. At first, it seemed to many of us that Google was diminishing its utility by excluding reviews from TripAdvisor and Yelp, for example. Instead, we realized that Google Places has "enough" native reviews to make the platform a good point of reference regardless. This "good enough" has enabled a launching pad for Google where those reviews are used (and written) by the fastest growing mobile audience in America. Driving reviews on Google will become an important new strategic objective in 2012. More: When we also consider Google's beta Hotel Finder product and their acquisition of ITA in 2011, I don't believe it to be an overstatement that for the Hospitality Industry, 2012 will be the year of Google.

Strategy Considerations
Android is quickly becoming the dominant mobile platform in America at a time when overall smartphone adoption continues to grow. While some significant studies suggest that mobile use (and commerce) is incremental beyond traditional web, our first-hand data suggests otherwise. At least in hospitality, where 75% of mobile reservations are same-day or next-day, mobile is absolutely cannibalizing traditional web.

Related to mobile adoption, DMW believes that we might be seeing the first signs of decay in the traditional value of SEO, because it... 1) relies on traditional web pages (don't render well on mobile), 2) can be undermined by Google's increasing shift towards personalized search results, 3) is often superseded by Places results, and 4) can simply be bypassed by seeking recommendations via one's social network.

Recommendation: In order to hedge against these changes, brands should continue a shift towards reviews, local presence, and other elements of the Google suite. Brands should experiment with Google Pages and consider developing best practices for YouTube. Along with Reviews and Local Presence, understanding these activities will position brands to gain a strategic advantage as the Google platform begins to assert its dominance in hospitality and restaurants in 2012.

The Yelp Factor and Independent Businesses

I recently read a good study at the Harvard Business School site entitled “The Yelp Factor” (ok, I actually just read the summary of the study, here). The research is asking a simple question that has enormous potential in the world of ecommerce and, increasingly, brick and mortar commerce: Do online reviews influence business? And, if “yes” by what margin? Since they first have come into play, I think that most marketplace participants have a gut “yes” on this.  Michael Luca has brought in real data points via Yelp, however, to help quantity what we assume to be true. 

One significant observation that the study yielded was that local businesses are most affected by reviews while chain venues (think Burger King) are the least affected. This means that if they provide good quality and establish some sort of review optimization effort, independents can gain ground against the big guys. This is a strong insight, but why is it occurring? McDonalds (and all those who followed) became such an enormous success because consumers came to learn that a McD's cheeseburger in Ithaca, NY will taste exactly the same as in Tuscaloosa, AL. While some people really love McDonalds for what it is, most people go to McDonalds because they know what to expect. They have enough information on McDonalds to enable a decision. With Yelp and all other online reviews, nearly that same level of information is available for local (ie: “unknown”) venues, too. End result: small guys can compete with big guys b/c they are known quantities now. 

This "tilting of the scales" towards independent venues also aligns well with a significant cultural shift in America that has been trending towards "connoisseurism". That is, our shift towards treating everything like people have traditionally done wine. Think micro-brew beers, OXO utensils, specific types of cow for steak, narrowcast popular music…  You know, long tail stuff making it a little more big-time. The connoisseurism trend shows a growing native preference for unique services of high quality, and online reviews are enabling this via a virtuous cycle that also yields more reviews.

While these reviews are certainly opening up opportunity for independent venues, Mr. Luca seemed challenged by the fact that the reviews might not necessarily represent actual quality. That is, there can be a gap between actual quality and described quality (via reviews). Where Mr. Luca sees fog, however, I see opportunity: It means that operators have the opportunity to control described quality (to a certain extent) or otherwise become victim to it. It makes a very strong case, again, for Review Optimization and largely puts the power in the hands of those who run quality operations.

Beyond these major points, the study confirms a lot of what we know and preach already at DSS: Review Optimization is a must. More reviews are better. Ratings affect revenue. Have a look at the study; if you see other thoughts in there (perhaps regarding Yelp’s rounding rules?), let’s discuss!

Starwood's Reviews, Part 2: Publish Reviews, Don't Host Them

In yesterday's post, I declared that "Starwood has made what will prove to be a seminal move in the hospitality space". When making this statement, I was focused mainly on Starwood's decision to publish reviews within their website, as opposed to their decision to host their own reviews. I talked with Jack a little today and we both realized that I had glossed over this important distinction.  Let's define the two strategies right away, so that we can then get to analyzing pros/cons of each...

• Reviews Posted to Brand.com: This strategy uses a product like Revinate's Buzz or even standard products from TripAdvisor to publish 3rd party reviews on a property's website. Shoppers go to the hotel's site to read reviews and can continue to shop from there. 
• Hosted Reviews: This strategy involves a solution like Customer-Alliance or BazaarVoice to generate proprietary reviews that live on a brand's website and nowhere else (or at least on no other third party review sites). 

So which is the better strategy? Well, regardless of which one hoteliers might be considering, the objectives for Review Optimization fall along these major points:

• Let's start with the basics: Hoteliers must bring reviews to their own websites. See yesterday's post for more detail.
• At all costs, hoteliers must promote and ensure authenticity and unbiased publication of reviews. This holds true for "hosted reviews" as well as "third party reviews on brand.com"
• To the greatest extent possible, hoteliers and 3rd parties must offer greater utility in filtering and searching reviews vs the review sites. (Again, see yesterday's post for more.)
• Enabling social sharing of reviews is a good idea and worthy of testing and learning. I very much applaud Starwood for their features in this area. In my opinion however, it is not a strategy that will yield significant results at this time. It will in the future, but there are more immediate goals to reach first, like...
• Reviews must be leveraged for optimization in TPIs/OTAs and search engines. Even if these channels are not necessarily preferred, they cannot be ignored.
• Above all else, hotels must optimize for Google maps/places. They must do it now. This includes driving reviews to Google. The Android mobile platform is growing too quickly and Google Hotels will be a viable player in this space within 24 months. This advice is most urgent for limited service and urban hotels that are most likely to be booked last minute, but is still valid for vacation destinations as well. Of course this is tied deeply to natural/paid Google search too.

Defining the objectives for review optimization helps us to define a best-possible review solution and to rank existing options. With the above points in mind, my thoughts on these strategies are...

• I strongly support "reviews posted to brand.com": it enables all optimization strategies while still drawing traffic to your own site. While this strategy lacks social sharing functionality, the opportunities for optimization in third parties and Google are simply too big to ignore at this time. Yes, it's true that readers can still be tugged away to TripAdvisor by navigating deeply into the reviews, but I think it is a current fair tradeoff for having the reviews on brand.com to begin with. 
• I am less enthusiastic regarding "hosted reviews". While this strategy does have the current advantages of social sharing  and better "review browsing" features, I think the cost is too dear in terms of lost optimization in the third party world. Plus, I cannot vouch for this first-hand, but I have to assume some onerous business process work for matching up reviews with actual reservations. 

In the near future, we will see products evolve to meet the overall set of best-practice features and functionality. I think there is a place for hosted reviews, particularly in their ability to replace current guest-sat surveys. They simply cannot be deployed at the full expense of 3rd party reviews. At least not yet... Anyone have a patent on the idea of a reverse TripAdvisor yet? It aggregates all "hosted reviews" into a single public site...

Starwood's Seminal Decision to Include Reviews on Their Websites

Starwood Hotels announced on Friday that they will now begin including user reviews on their websites. I very much support this strategy and congratulate Starwood on being first to market with what will prove to be a seminal move in the hospitality space. Here’s why…

In a few short years, user-generated reviews have become an immutable third element of the hotel shopper’s experience, along with the traditional “price” and “location”. It is important, however, to view the development of user reviews within the larger context of online shopping for hotels. Consider that, from roughly 1997 through 2005 (or possibly later), TPIs/OTAs thoroughly ate hotel brands’ collective lunch by realizing and leveraging the power of online reservations. Hotel brands eventually caught on and have since been involved in a carefully orchestrated turf war with Travelocity et al. While TPIs/OTAs certainly form an important channel, hoteliers have lured shoppers to their own sites in the past seven years by offering “best rate guarantees” a more robust shopping experience (hopefully including rich photo and video content), and more. 

As a category, however, TPIs/OTAs continue to evolve and innovate much faster than hotel brands. This is particularly true with mobile (and tablet) web and apps and especially true with reviews. Even as they otherwise optimize their websites for best-possible experiences that will draw traffic from the OTAs, hotel brands have been losing out on brand.com revenue because reviews --that must have information for nearly all hotel shoppers-- are not available on hotel brand websites! The end result is that even brand loyalists are forced to browse reviews on TripAdvisor or any other review site of their choice before attempting to book at the brand site. And of course, a good many of them are lured into the bookings paths of these others sites instead... Whether the reviews or good or bad, shoppers are going to read them. Hoteliers should do like Starwood has done and bring those reviews to their own sites, where they are more likely to convert shoppers in a direct channel and to gain ancillary data points (like time spent reading reviews, etc) to boot.

So while we can congratulate Starwood on bringing reviews to their site, we must ask ourselves the next question: How will they change the habits of a market that has been taught for the past 15 years to read reviews on independent and objective sites like TripAdvisor? Including user reviews on a website is an important first step, but not enough to change market behavior. There has to be something else that will draw users to the site for one-stop reviewing+booking. The trick to changing this engrained user behavior is to evolve the review experience and make it more useful to guests than it is today. If --and only if-- they succeed on this front, will shoppers use this new functionality on Starwood’s website in any meaningful quantity.

To Starwood’s credit, this is where their new solution shows great potential. They include new filters for reviews like Loyalty Members (or not), Purpose of Travel, and Frequency of Travel.  While l would like to see additional filters (average review score by authors or "travelling with children", for example), this is a great start and will certainly evolve in time to help people see scores that correspond with their general tastegraphs.

Overall, I think that Starwood have done a great job in anticipating challenges and by simply being brave enough to be the first to dive into the pool. The rest of us can watch carefully for market signals regarding willingness to believe the authenticity of reviews that are hosted by the brand. I’ll be looking, too, for any signs of operational strain that could be caused by having to vet reviews and validate that the authors actually stayed. We should also be on the lookout for evidence of new search strategies that might be deployed: Will Starwood always link to the homepage or booking engine? Or would review pages make for a more appropriate first stop in some cases?

How about you? Are you willing to trust Starwood reviews?

Edit: Despite my enthusiasm in this post, Starwood's solution is not perfect.  See next post for more thoughts...

Google Hotel Finder: First Impressions

It is very telling that Google has labeled their Hotel Finder project as “experiment”. It suggests that this service is rough but that Google wants to continue to pursue this market agressively. Despite the label, I found the new service to be responsive and useful; I’ve already used it to book my next business trip.

Like many of Google’s best products, Hotel Finder is an exercise in simplicity. It strips down the hotel shopping experience to five familiar elements: Location, Dates, Price, Class, and –significantly- User Rating. The page is bare, and there is none of the usual advertising and other “stuff” that we have become used to with other sites. To be fair, this is because Hotel Finder does not necessarily have to generate revenue in its own right. 

So far, I like Hotel Finder. The service has new clever features, includng “draw a shape” so that you can specify exactly your preferred geographic areas (I can see this feature evolving nicely for touch devices), and a pricing feature that compares posted prices to “Hotel’s Typical Price” (possibly fueled by Google’s ITA acquisition?). For me, however, the killer element of this new service is speed. Even sites that I otherwise love, like Kayak, seem to take a modern eternity when trolling for search results. Hotel Finder, however, is very fast. For some searches, I’d even describe it as Instant. This is true for the original searches, and espeically true for follow-up activity like looking at photos or reading reviews. The combination of a bare-bones UI and very fast load times will be a major advantage when this service is optimized for mobile web and mobile app (Note: I checked – as of now the service is traditional web only).

In the near future, I can see this product graduating to the “beta” stage and becoming integrated with organic searches, in much the same way that Places/Maps has evolved. In fact, I could see this service replacing Places/Maps results if a search happens to be for a hotel. Due to its speed and simplicity, I can see this product becoming a standard element of the shopping and buying experience. 

So what are the key takeaways? As usual, it’s all about reviews, reviews, and reviews…

1. The release of Hotel Finder and the recent news that Google Places/Maps no longer includes reviews from third parties underscores the importance of treating Google as another review platform that, like TripAdvisor, must be monitored, managed, and optimized. I cannot overstate the importance of this. Google will overtake TripAdvisor as the de facto review platform because it is a gateway to the overall internet – both traditional and mobile. It’s just a question of how soon this will occur.
2. Reviews, again, feature very prominently in this new service. After an area is selected, the results can be sorted by Hotel Class, User Rating, and then by two price categories. “User Rating” is the second column, a telling detail when trying to divine Google’s strategies in this space. When a hotel is selected for closer inspection, reviews again display very prominently beneath the photgraphs, along with a notable call to action to leave a review if the user has visited the location.
3. Optimize your Google Places Listings: Several good reasons already exist for doing this, and Hotel Finder has just become one more. DMW research shows a direct correlation between SERP ranking for Maps/Places and optimized Places listings. 

As time goes by, and as Google collects feedback, I suspect that we will begin to see this service tilt towards "impulse" and "same day" reservations vs. the more formal vacations and events that usually have a longer research cycle. I could also see potential incorporation with flash deal sites (see Google's acquisition of Dealmap, and its own Google Offers, for example). What are your thoughts? Have you used Hotel Finder yet? Is it better than Kayak?

Solid Review Optimization Strategies and Changes at Google Places/Maps

News came out yesterday that Google has removed from Places and Maps all third party reviews, including (especially) those for hotels and restaurants. In my world, the world of social media/reviews/mobile/ for hospitality, this is very big news. I've got two immediate guesses as to why Google is doing this: 1) Proactive effort to head off ongoing legal challenges from players like TripAdvisor, buoyed by the fact that (through Android) Places/Maps are getting close to achieving critical review mass, or 2) This is a first step in creation of a B2C travel offering from Google where it wouldn't be appropriate or legal to include 3rd party content. If you’ve got thoughts on this, please share them in the comments.

I will admit that, upon reading the headline alone, I was concerned that the cornerstones of some of our fundamental strategies at DMW had just been pulled out. But, then we began to do what we do best at DMW: we rationally went through the meaning and effects of this change and highlighted what this does and does not mean for hoteliers, in particular, who are focused on developing a review optimization strategy. DMW’s analysis begins below. We currently have a few open questions and a few hypotheses, but we also have a good set of facts and best practices that we believe still hold true, regardless of the source of reviews that Google displays on Maps and Places results. We believe that many of our recommended strategies and best practices remain solid because we focus on thinking about context, not specific platform. Yesterday’s news served as a very important example of why this is so important.

So, let’s have a closer look. The comments from Google stated clearly that review snippets, ratings, and review counts from 3rd parties will "no longer appear" on Google Places and Maps. The article makes no mention of whether that data will still influence the rank of venues in Places/Maps or in organic search results, however. For me, this is the primary open question at this time. I see two possible general outcomes…

Outcome 1: While reviews are no longer visible, review data (quantity of reviews and average star rating) still influence rank results in Maps and Places. Here’s an example: Data from TripAdvisor reviews contributes to the ranking of a given hotel on Places, but consumers do not see those reviews. This would be similar to a given webpage being ranked first by virtue of inbound links to it (the core of Google’s algorithms), even though we are not shown the inbound links themselves. If non-Google review data still influences Maps/Places results without being visible, review optimization strategies are still 100% viable.

Outcome 2: Reviews do not influence Maps and Places but do continue to influence organic results. In my mind, this is all but a certainty. Inbound links to reviews will still push hotels up through Google’s organic results. End result: Your hotel’s top organic listing could possibly be on TripAdvisor (instead of a best-case scenario of being your own branded website). However, that’s still better than your competition’s hotel taking the top listing. Again, review optimization matters.

In both cases, it is important to remember that Review Optimization is still a valid strategy because it optimizes listings within each platform that contains reviews for a given hotel. DMW has conducted analysis that proves most hoteliers’ instinct: there is a direct correlation between better (and more) hotel reviews and ROI from the channel that hosts those reviews. Now that Google is becoming a review platform in its own right (versus just a review aggregator) a full Review Optimization strategy should actively focus on monitoring and responding to Google reviews, too.

So, the takeaway for today is that the players and services have shifted some, but the context and best practices remain very valid:

• Customers will still be looking for reviews and shopping via Google. 
• Google will still display reviews (albeit only their own, for now), and 
• Review/OTA websites like TripAdvisor, Orbitz, and Priceline will remain with their reviews and business models, too. 

With a “what’s-not-changed” list like that, pursuing a Review Optimization Strategy absolutely remains a safe bet.

The Google+ Project Will be Google's First Social Media Effort to Achieve Critical Mass

I don't have my invite yet, but I got my invite yesterday evening, and I've been playing/reading/watching up on the new Google+ Project offering from Google. From what I've seen so far, I think it might hit the mark. One big win is that service does integrate directly with current Gmail and Android contacts. This is crucial: I've written in the past that other Google social media efforts (Hotpot, +1, Latitude) were destined to fail b/c they were platforms that didn't allow me to bring "my network" (my email contacts) into the mix.

I've been of the opinion lately that the mobile app, GroupMe, is all of the Facebook I would ever need. It allows me to start group chats, identify my geographic location, start phonecalls, share pictures, and more. Best of all, GroupMe allows me to do this on a per-group basis: No all-or-nothing approach as with Facebook. One of the most compelling features of Google+ is this same breakout of friends, each with its own settings. Google knows this and plays heavily into that when promoting their "Circles" feature.

So, does Google finally have a social media winner? I see a lot of press focused on whether this offering can unseat Facebook, but I'm not sure if that is the right question. I'm more interested in the potential for Google+ to achieve critical mass, that is sizable and sustainable adoption -- regardless of comparisons to Facebook. If "yes" Google will have demonstrated that social media platforms are not one size fits all. I think this is where the space is going, and I can see this as an important learning for the marketplace.

The precedent is already here: today, we have an easy split between Facebook (for personal social and commerce use) and LinkedIn (for business). Longer term, I could easily see some fragmentation (with Facebook remaining strongly dominant), along with the rise of "social media aggregator services" that bring together streams from various sources. Again, the precedent exists: see TweetDeck and Hootsuite's ability to bring in LinkedIn, Twitter, Facebook, Buzz, and more. And, we also have products like Trillian and Adium that aggregate multiple instant message platforms.

So to pose the question a different way: Will Google+ achieve critical mass? I think, yes, that this time they might have it right. They've got a great-looking new platform with the right control settings and the right connections in place -- with Gmail, Google +1, and more. To further help drive adoption, Google will benefit from the Android OS and (soon) the Chrome OS. In the long run, Google will have an inherent competitive advantage b/c it will be able to directly bake-in to the OSes - basically becoming an ever-present service to support other activities.

It seems silly counting Google as an underdog here, but if Google +1 became a persistent, if smaller, player in this space, I would consider that a big victory for them and for the marketplace, too.