Background
Boutique surf hotel acquired mid covid as a distressed property. Target market of international travelers who will pay a premium for a destination experience. Surf lesson package trips can yield 3x the revenue of a stay alone.
Google ads are paid placements at the top of all other search results. They can show images, custom text, links to parts of the website, contact forms, etc.
Bookings prior to google ads campaigns came primarily through booking.com or airbnb, both of which take a ~20% commission, and often only want the hotel stay (recently through Instagram as well).
Objective
Advertise to currently in market customers using google ads, particularly those who are interested in surf lessons in addition to accommodations. Minimize cost per booking via the google channel. Conversion tracking is enabled by placing a pixel that follows email lead form submission.
Campaigns
- Smart search (mostly display advertising) - Targets US/Western Europe/Australia. Discontinued
- Performance max (display/SEM/partners) - Targets US/Western Europe/Australia. Discontinued
- Destination Travel SEM- Targets US/Western Europe/Australia/Asia all with separate campaigns.
- Local Travel SEM- Targets Bali.
- Brand SEM - anyone searching specifically for LMBK
- Competitor SEM- anyone searching for other surf camps in Indonesia
Findings
- Clickthrough rate (CTR) ~4%
- Cost per click (CPC) ~$0.60
- $0.23 smart search
- $1.39 performance max
- Cost per Conversion ~$18
- $20-22 Travel campaigns
- $2.29 Brand campaign
- $102 smart search
- $99 performance max
- The initial smart search campaign was very efficient at pulling in visitors as measured by CPC. However the traffic was all very low quality, with few conversions and a high cost per conversion.
- Performance max campaign had a very low CTR and may have been hurt by poor creative to display for youtube ads. This will be retested as video content available improves.
- Before breaking brand searches out into a separate campaign it was getting bid on as part of the other campaigns, making their performance appear better than it really is (many brand searches would convert organically anyway). This is important to account for in the campaigns themselves and in spend decisions.
- Booking.com is one of our largest competitors on searches. Particularly for brand searches it is very important to pay the <$3 to acquire the customer via our own website and avoid the 20% fee.
Strategy
Roughly 1 out of every 3 email leads results in a booking, making a booking acquired via Google Ads ~$56. Given that week long surf packages can range up to $1,000 this is highly efficient. We would spend more into this channel, but the hotel is at capacity for the summer months.