London 2012 Olympics - Hotel PPC Strategy

The London 2012 Olympics will be a huge for the UK travel industry. With it fast approaching I’ve asked our resident Travel expert Amy Kay to give her thoughts on what to expect and how we should prepare our Paid Search campaigns.

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The London 2012 Olympics and Para-Olympics present a major opportunity for the travel and tourism industry at a time when the economic climate threatens to cast Europe into the depths of a double-dip recession for the first time since the 1970s.

The impact of the Olympics will be seen both in the UK and across the rest of Europe. Overseas visitors to the UK are expected to increase by 4% during 2012, whilst domestic trips to London are also forecasted to increase to just below 13 million. However, we can also expect an increase in travellers from the UK leaving the country due to the disruption caused by the events.

So, what do the Olympics mean for the UK hotel industry and their PPC strategy?

For London hotels, the Olympics create an incredible opportunity, with high demand expected during both the Olympics (27Jul – 12 Aug) and Para-Olympics (29 Aug – 9 Sept). Already, committed occupancy for the Olympics is at 46%, a 300% YoY uplift, with the busiest night expected to be the opening ceremony on 27^th July. Whilst occupancy is already high for this time of year, there is still availability and therefore an opportunity to capitalise further on demand through PPC activity.

Worldwide queries for ‘2012 hotels’ combined with the growing popularity of searches for the London Olympics signify an early interest in people looking to travel during this period:

There has been a significant uplift in queries from late December 2011, and related queries are expected to grow further as we get closer to the Olympics. Travel queries related to the Beijing Olympics in 2008 started to grow around 9 weeks before the opening ceremony:

The queries that drove the huge peak were more informational, but the circled peak were more ‘path to purchase’ orientated, such as ‘Beijing cheap hotel’ which grew 700% WoW, 9 weeks before the opening ceremony. Early preparation is going to be vital to PPC campaigns, with full brand coverage recommended for hotels, and substantial budgets for those who wish to play in the generic space during this time.

Additional opportunities also exist for London airport hotels, which should see an uplift in demand from long-haul visitors to the Games, both in-bound and out-bound. Early interest for the Olympics is coming from Australia and the US, so early bookings are likely.

Competition will be rife amongst hoteliers and OTAs looking to capitalise on the demand for London hotels, increasing CPCs and making it harder for smaller companies or individual hotels to compete in the generic arena. There are also strict regulations around the London 2012 brand, which means the vast majority of broad generic terms surrounding the Olympics will be trademarked, including ‘London 2012’.

London hotels will need to be smart in their PPC strategies, considering longer-tail keywords to reduce their CPCs, promoting Olympic stays without mentioning the Olympics, and keeping a close eye on availability during the period to ensure they reduce activity once they reach occupancy.

Great, but what does this mean for hotels that aren’t in London, or even in the UK?

The Olympics will also have a significant impact on other UK destinations and European travel during 2012. If we look at the Beijing 2008 Olympics, interest in other Chinese provinces grew substantially YoY as visitors to the games looked to continue their travels. London is a popular portal to the rest of Europe, and the increase in visitors to the city for the games should increase domestic and European travel post-Olympics. There will also be the opportunity to capture UK travellers looking to book trips both during and after the event.

Ensuring coverage on the UK market during 2012 will be important for European hotels to capture those wanting to travel during, but also post-Olympics, as there will be a high percentage of people postponing their travel plans until after the events. If we take learning’s from the last major sporting event, the 2010 World Cup, travel queries during the games themselves declined by 4% in June, however they saw a 16% uplift in July.

Coverage in other markets will also be important in PPC strategies, as visitors to London for the Olympics will plan and book their extended trips in advance, particularly those travelling from long-haul destinations. This applies not only to hotels in popular European destinations, but additional UK cities are likely to see an uplift in tourism off the back of visitors to London.

2012 looks set to be an interesting year for the travel industry on the whole, and developing PPC strategies utilising historical trends from previous sporting events whilst incorporating traditional seasonal trends will be key to success. Creative messaging will be important, and competition is likely to be high in line with demand, but the Olympics have created a positive opportunity for the European hotel industry during a time of economic uncertainty.

To summarise:

Traffic should start see a significant uplift around 9 weeks before the games, with the biggest peak around the time of the opening ceremony
London hotels will see the strongest demand, with airport hotels also seeing a YoY uplift in bookings around this period
European hotels and other UK destinations should also see an increase in demand after the games, as visitors extend their travels
The Olympics will impact on seasonal trends for hotels across Europe, particularly those who see high volumes of UK travellers
Generic terms will be extremely competitive, so be smart about your messaging and long-tail keywords
And finally, monitor availability – you don’t want to be pushing campaigns for hotels with full occupancy.

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