Conversion Rate Optimisation

Not all conversion rates are created equal.

Seeing articles online saying - “A good conversion rate is between 2 – 4%”, might make you panic about your own. The thing to keep in mind is, you don’t know what type of conversion this data is looking at.

Here are a few different factors and scenarios at play:

  • Every marketing platform uses their own attribution models, which in turn impact conversion rates.
  • Our booking engine reports look at bookings to total searches. It’s a good metric to consider but bear in mind that the number of searches per user increases the higher the percentage of searches returning no availability become. Likewise, the searches per user tend to increase with increased room rates and in times of economic uncertainty, with users completing more searches to find rates/dates that fit their budget. An increase in searches in these circumstances will directly and negatively impact your conversion rate
  • Google Analytics reports on bookings and vouchers to total sessions on the website. As with the booking engine report, users may return multiple times to the site prior to making a booking. The more often they return, the more they negatively impact your conversion rate, even if a booking is ultimately made.
  • Lead Generation campaigns are likely to have a higher conversion rate than purchase conversions, i.e. it is much easier to get someone to sign up to newsletter than it is to get someone to book a stay for €500, so conversion rates here will look significantly healthier.
  • Do you have strong wedding or F&B business? The traffic for these market segments is valuable to your business but will negatively impact your Google Analytics conversion rate as the site visits don’t end with a booking or voucher conversion.
  • What type of hotel are you? A 2% Google Analytics conversion rate might be excellent for a high-end, luxury resort but a very bad day in the office for an airport hotel.

Work with what you know.

Comparing yourself to other people’s conversion rates that you lack context for is a sure-fire way to drive yourself crazy, so what can you do?

  • Pick your source of truth. Do you want to focus on your booking engine conversion rate for driving growth? That’s great, as long as you identify the caveats that come with it (high no-availability etc.)
  • Focus on your own growth, not other businesses or benchmarks you find online. You don’t know if the benchmark you are looking at also has 5x your marketing budget, an in-house content writer and a marketing team of 15 people to drive those figures. The only thing you know for sure is what capabilities and capacity you have in your own business so structure your growth around that
  • When analyzing conversion rates, always bear in mind that changes in marketing activity and the market itself have an impact. There are 4 key items that can impact your conversion rate:
    Natural seasonal fluctuations
    2. Channel specific – e.g. is your latest email campaign performing better/worse than usual
    3. Change in traffic share – e.g. have you increased your spend on prospecting campaigns, driving more traffic to the site which doesn’t have an immediate purchase goal but will create a long-term warm audience for you
    4. Broken Funnel – e.g. Are users finding availability on your website? Are they able to book children into family rooms?

You can’t take traffic (or conversion rates) to the bank

If your goal is to just increase your conversion rate, you can drop your rates to €30/night. You will see your conversion rates skyrocket - but your business might not survive the drop in revenue.

Ultimately, our goal is to increase your revenue. It’s easy to lose sight of that sometimes when you get focused on individual metrics so always bring your growth plans back to that.