Today we will talk about two critical parts of our day to day operations and how they should be connected: online marketing and competition analysis.
When we say online marketing we are referring to any type of channels such as Facebook, Instagram, Google or native ads on travel sites. On the other hand, competition analysis relates to the market benchmarks and pricing reports we make when trying to find growth opportunities and beat our competitors. We will cover examples for flights but the principles are applicable to other products as well.
Bidding
The most important variable you need to define when buying ad placements is cost-per-click. Even when you are bidding on another target like conversions there is always behind an equivalent CPC that is calculated by the medium.
But why not use your existing competition analysis data here? You definitely should.
Keep a list of all your routes and calculate your average positioning as a percentage of the difference between your price and the cheapest price for that particular itinerary.
When that delta is too high, it means you are not really competitive on that route. In these cases your CPC should be minimum, to get some cheap traffic but expecting that the overall sales conversion will be low.
Also there has to be a maximum delta you are willing to accept. Let’s say the average difference is more than 20% then you are probably better off not bidding at all on that route.
On the opposite side, when you have the best prices in town you should go all in. Bid higher on those routes and you will see the best results in terms of revenue.
Grouping
In the previous section we said make a list and group it by routes. That is the best option if you do all the bidding manually, but it’s definitely not the optimal solution. The deeper you go the more efficient your campaigns and returns on investment will be.
Consider adding another level by grouping by routes and then airlines. After that you can start segmenting by the travel dates. Even more? You could have one campaign for each itinerary. That of course is only possible if you automate the whole process, which I’d recommend only if you previously made it work manually and learned all the tricks by experience.
Creatives
A data driven approach doesn’t necessarily apply to the bidding numbers only, you could also take advantage of them on your creatives. When you know you are competitive, display your prices and show a sign indicating how much cheaper you are than the market.
But when you know you are not very competitive, change the creatives and showcase another side of your value proposition like flexible changes or financing.
Final Thoughts
We covered just a few simple examples of what you can do combining competition data into your online marketing strategy, but there are infinite possibilities of things you can try to optimize the campaigns.
Remember that it’s not about any particular trick to beat the system, it’s about always being more data driven and automating every process. When you are done, then it’s time to try a new process. There’s always room for efficiency.
