How to Benefit From the Travel Ad Spend Increase in Europe

In a difficult environment for advertising, the US travel industry will bring up the rear in overall spending, growth, and share, and by most metrics, will have the most challenging year any vertical has had since we began tracking digital ad spending.

How much will digital advertisers spend on travel ads this year?

Travel industry digital ad spending will amount to just $3.24 billion, a staggering decline of 41.0% year-over-year (YoY). We estimate that travel will account for just 2.4% of US digital ad spending, down from 4.2% in 2019.

How has the coronavirus pandemic changed our outlook?

Pre-pandemic, we estimated 19.3% growth for travel ad spending, a strong figure in line with the generally robust trends for digital across nearly all verticals. No industry had grown its digital ad spending at less than a double-digit rate in the past three years; travel’s 41.0% decline is unprecedented.

Which digital ad format will see the most travel spending?

Travel leans more toward search ad spending than any vertical. Search will account for 58.8% of its digital budget, compared with the industrywide figure of 40.4%. But the $1.91 billion that travel will spend on search will be the least it has transacted on the format since 2016.

Which platforms are favored for digital travel ads?

Unlike most industries, which lean heavily on mobile, travel is balanced between mobile and desktop/laptop ad spending (50.9% versus 49.1%).

• 5 Benefits of Google Ads for Your Tourism Marketing Strategy
• Ad Spend on Travel in the US Is Growing Faster than Other Verticals
• How Travel ad Spending is Starting to Rebook Across Europe
• 7 Tips to Get Vacation-Worthy Return from PPC in the Travel Industry

5 Benefits of Google Ads for Your Tourism Marketing Strategy

As a tourism or travel marketing manager or operator, how do you know what online marketing channels to invest in? Utilising Google Ads (formerly known as Google AdWords) is part of any effective tourism marketing strategy.

Here are 5 benefits of Google Ads to Your Tourism Marketing Strategy:

1. Immediate Results

Unlike SEO (Search Engine Optimisation) that takes months to build up traction, Google Ads allows you to immediately get your tourism business in the top placements of the Google Search Results Page.

Read Also: How Online Video Advertising can Boost Business Profits

Right away your ads will start showing to potential customers and get visitors coming to your website browsing your offers and travel packages.  That’s winning.

From there it’s all about optimising the Google Ads / AdWords campaign to target your ideal customer and get more conversions at a lower cost.

2. You Only Pay When a User Clicks Your Ad

Ever thought about a billboard or bus advertisement and wondered how many people might take action from it? It can be a little vague to know the estimate figures and results. With Google Ads, also known as Pay-Per-Click (PPC) advertising, you only pay when a user clicks your ad to visit your website.

Plus, there is a great deal of historical data and projection data to give you a good idea before we launch a campaign about what results you can expect. Only paying when a user clicks your ad can give you the confidence that your investment will be worthwhile.

3. Gain Valuable Customer Insight

Whilst Google Ads does provide immediate results, the real benefit comes a few months in at which point we have sufficient data to make smart data-driven optimisations.

Is there a particular location that seems to be driving conversions? A particular demographic that is liking your ads? What about the best times of day and day of the week to show your brand’s ads? We can start to learn all of this about your audience and make the right choices to stretch your ad spend further and maximise results.

This is also great insight you can use to inform your other marketing channels, such as testing a keyword to see if it will perform well before you spend months organically SEO optimising for it or learning more about what messaging resonates with your customers.

4. Build Your Brand

Google Ads can get your brand in front of your ideal customer and keep it top-of-mind throughout their holiday trip planning.

Travellers need time to make their holiday arrangements and bookings, so by having your ad popup regularly and show to them across the web through display remarketing you can ensure that they won’t have forgotten you when it’s time to book.

5. Show Up on Related Travel Websites and Blogs

As your customers are planning their holiday, they’ll likely be browsing around at other travel websites and blogs for things to do, where to eat, travel advice and other deals. Your brand’s display ads could show up on sites like stayz.com.au, travel.nine.com.au and more.

Ensuring your brand appears on travel-related websites and blogs helps customers to see your brand as a trustworthy tourism operator.

Ad Spend on Travel in the US Is Growing Faster than Other Verticals

Travel is the sixth-largest industry in terms of ad spending in the US this year, according to our newest estimates. Rising competition and a strong economy are prompting travel companies to increase their ad budgets to capture a larger market share.

Digital ad spending on travel will grow 21.4% to $10.86 billion this year. Next year, ad spending will grow 19.3% to $13 billion.

Since travel is a search-heavy vertical, we foresee travel advertisers continuing to rely on search ads to reach consumers. We estimate that advertisers will spend $5.84 billion on search in 2019. The travel industry has the fourth-largest search ad spend out of all the verticals we break out, making up 10.9% of total US search spend.

“Search is crucial for travel advertisers, and search engines have products that are specialized for the travel industry,” said Sarah Scherer, product marketing manager at Goodway Group, who spoke with us for our Digital Ad Spend by Industry 2019 report collection. “It’s foundational for travel advertisers to have a presence on search.”

Travel advertisers are also increasingly becoming mobile savvy, using mobile data to target customers. For example, ad agency Crossmedia used mobile data for their out-of-home (OOH) campaigns, citing that companies that leveraged mobile data for OOH garnered 20% to 40% higher foot traffic than those that didn’t.

This year, travel advertisers will spend $7.62 billion on mobile ads—a 25.1% growth from last year—which accounts for 70.1% of all travel digital ad spending.

Video is quickly becoming a preferred ad format for the US travel industry; US travel advertisers will spend $2.62 billion on video this year, a 25.7% increase from 2018. We classify digital video as a subcategory of display ads, which includes formats such as banners, rich media and sponsorships. The share of travel display ad spend on video will increase to 59.0% in 2020.

Digital video’s growth overlaps with social’s growth. As of Q3 2018, we changed our methodology for our video ad forecasts to encompass outstream formats including social media in-feed ads.

“The growth of travel advertisers’ digital video budgets is being driven by social platforms,” said Ross Benes, analyst at eMarketer and author of our “Digital Ad Spending by Industry 2019” report collection. “Facebook and Instagram in particular are becoming more popular outlets for travel advertisers to promote their lifestyle products.”

In travel industry ad platform Sojern’s November 2018 poll, the majority of worldwide travel marketers said they planned to increase their Facebook and Instagram ad spend. Among those working with cruise and airlines brands, six in 10 respondents reported that they will raise their Facebook and Instagram spend.

How Travel ad Spending is Starting to Rebook Across Europe

As travel restrictions relax across Europe, optimistic holiday advertisers are buying more ads to make up for lost time — but those commitments are selective and focused for now.

Though tourism is returning to the region — ranging from Greece to Lithuania — its resurgence has been tempered by new outbreaks and inconsistent travel rules between countries. Total ad spending in Italy, Spain, France, Germany, and the U.K. for the first half of the year was down nearly half (46.2%) compared to the same period last year, according to Nielsen Ad Intel. 

But the real pandemic-induced decline in digital traffic came in April, when performance marketing agency Roast saw a 62% reduction from March, with some of its advertisers similarly pulling significant portions — if not all — of their paid media ads. 

However, each subsequent month has seen a growth in ad spending, notably in paid search, which nearly doubled traffic from May to June, according to SimilarWeb cited by Roast.

And while ad spending in travel is still far below pre-pandemic levels, according to four travel experts interviewed for this article, it has been slowly on the rise since May when countries like Italy, Spain and Estonia outlined plans to restart tourism. 

Between Mat 20 and June 20, ad spending across Italy, Spain, France, Germany and the U.K. was up 6.3% on the previous month, according to Nielsen. It may be only a fraction (16.2%) of what advertisers spent in January, but the increase suggests advertisers are getting more confident in their ability to salvage some sales over the summer. 

“We’re still generally seeing a very soft advertising and media market. said Alessandra Di Lorenzo, CEO of Forward, the media business of the online travel site Lastminute.com.

Consequently, the main travel advertisers that buy ads from Forward’s Display Open Marketplace are not back to the levels they were in terms of spending, which is causing weakened demand pressure that’s unable to drive up the price of ads that are “very soft” compared to last year, said Di Lorenzo.

Still, she added: “As the positive trend of the online travel agency volumes increases, things are starting to improve with week-over-week growth across our audience and display publisher portfolio.”

Reaching those customers is not without its challenges as they emerge from lockdowns as different types of travelers than they were before the pandemic began.

Shorter booking windows, flexible policies, competitive pricing, stricter health screening measures and mobile bookings are some of the trends emerging from the lockdown. There’s also the mindset of would-be travelers to consider.

The pandemic has been a time for reflection and many people are choosing to do things that they would’ve usually put off and are therefore choosing to do things that may be closer to home — a trend that Scotland’s tourism board VisitScotland hastried to tap into in recent weeks.  

“Our strategy, therefore, sought to support the businesses in tourism and therefore the wider economy as well as providing the positive wellbeing benefits that visitors were seeking,” said Stuart Randall, head of strategy at VisitScotland’s creative agency Whitespace.

“We also wanted to feature the people behind Scottish tourism to add warmth and a sense of connection all with the scenic backdrop and warm welcome that Scotland is famed for.”

It is, however, unlikely that travel and tourism will fully recover in 2020. Not when people are still worried about their safety.

Nearly two-thirds (64%) of adults across Great Britain would not feel safe traveling by plane currently, up from 40% on 8. June, according to a recent 1,612 person survey by YouGov. There is a similar unease about other types of international transport.

Over half of those surveyed (55%) say they’d feel unsafe traveling by train, while 48% would not feel comfortable on a ferry. In both cases, this is a substantial jump from 31% on June 8 for both modes of travel.

“Content is shifting in response,” said James Calvert, chief data strategy officer at M&C Saatchi. “If marketers don’t feel like they can sell someone a holiday right now, then they’re trying to find ways to inspire them for when they do decide to go.”

Still, advertisers in the sector are mindful of how much demand they stoke while social distancing measures are enforced. Airlines, train operators and coach companies have seen their capacity dramatically cut as their costs are likely to increase.

Little wonder then why most advertisers are prioritizing the low hanging fruit of targeting those people they know who do want to travel. Usually, advertisers would have chased prospective customers. 

“The key focus for travel marketers right now is making sure people who are in the market for a holiday convert with your brand, whether you already know them as a previous customer or via some lead generation activity,” said Alastair Poole, account director at media agency NMPi by Incubeta.

Retargeting, particularly on social networks like Facebook, has been a crutch for many of these advertisers that are looking to reach as many people as they can with targeted ads.

Between March and April, Facebook ad spending from travel advertisers across Italy, France, Germany and the U.K. dipped from $11.5 million to $3.8 million, according to Pathmatics. Since then ad spending has risen and hovered at $9.5 million for the first 21 days of July. 

It will take some time for ad spending to fully recover in travel. Given how volatile the situation is, no advertiser wants to spend lots of money chasing sales when the rules of traveling may change.

“I don’t see many travel advertisers back on TV yet,” said Calvert. “Everyone is still wary. A lot of the companies in the sector are running reduced services and with those reductions come lower expectations. They’re more focused on the customer base they can go back to and talk to at the moment.”

7 Tips to Get Vacation-Worthy Return from PPC in the Travel Industry

The internet accounts for over 74% of both leisure and travel planning, according to a recent Google study conducted by Ipsos MediaCT. With 57% of leisure travelers and 64% of business travelers claiming that they always start their travel booking and shopping process with search, having a robust paid search strategy is beyond critical.

Although with competition like Expedia, Orbitz, and millions of unique travel offerings out there, how does one stand out and capture quality leads through search engines like Google and Bing?

What can travel marketers do to get a return from their paid advertising spends?  These 7 travel marketing tactics have proven successful for a variety of travel businesses of varying models and offerings.

1. Adjust Your Offerings, Bids, and Budgets to Seasonality Patterns & Target Demographics

Do you think a retired doctor is interested in an all-inclusive spring break package to Cancun? Well, possibly, but that would be a rare, unlikely occurrence and might cause some awkward scenarios for the fellow 18-25 year-old spring-breakers.

If you saw an advertisement promoting cross-country skiing packages in April would you be likely to book? Probably not… Are you understanding what I’m hinting at? Advertisers need to be extremely diligent about timing as well as demographics, because within the travel industry timing and catering to specific personas is beyond critical.

AdWords should never be set it and forget it, but with travel, pausing seasonably irrelevant campaigns, making adjustments to ad text, and monitoring locations, time and hour of the day are even more critical for these advertisers to avoid wasting large sums of marketing spend.

Beyond targeting the right locations, languages, etc., travel marketers need to be diligent about keeping up-to-date with seasonality trends and updating their keywords, ads, landing pages, etc. as necessary. Travel marketers should…

• Bid higher on locations, days, and hours when people are more likely to book travel: Are there certain states or cities which tend to generate a larger chunk of your traffic? What about specific zip codes where affluent travelers reside? The Dimensions tab in Google AdWords should become your new best friend. “We’ve used the geographic report (within the Dimensions tab) to identify the five states where people looking to travel to Costa Rica reside and made bid adjustments to bid higher on California, Texas, New York, Florida and Colorado,” says Bateman. Once you have a substantial amount of data, dig into your geographic report to get a sense of the main locations people are searching from and make adjustments to your bidding strategy from there.

Within the Dimensions tab you can also gain insight into the days of weeks and hours of the days that you’re getting the highest return and choose to exclude or bid higher on certain days/times.

Tom Popper, President of the non-profit travel organization Insight Cuba, found that bidding higher on specific hours made a huge impact on his lead quality. “Having our ads appear during those peak hours when our audience actually pays attention is critical,” says Popper.

• Create separate campaigns for each destination: Aside from giving you better control over your budget for higher interest locations, which have higher advertising needs, this will also allow you to easily pause and un-pause your campaigns that are relevant per season. For instance, in the fall you might want to run your winter vacation campaigns, but you’re more likely to pause these destinations in the spring.
• Adjust ad copy to speak to a seasonably relevant demographic: Jason Swick, Director of SEM at SimpleView, manages paid media campaigns for over 50 clients in the travel & tourism space. Swick has found that catering the search experience to a specified audience is critical, but with limited demographic targeting capabilities through the search network, Swick hones in on his client’s target audience through creating relevant ad text. “Certain times of the year the audience we’re catering to is much older so we’ll tweak ad copy to make it more engaging to an older generation,” says Swick. “We always look at demographic data and take that into account.”
• Utilize Ad Customizers: You might not be familiar with ad customizers since they’re a relatively new feature Google released in December of 2014, but for the travel industry these babies can save you a lot of manual work, and allow you to create a sense of urgency within your ad text. Ad customizers are similar to dynamic keyword insertion – they essentially allow you to add in a limited-time or reoccurring countdown or discount that updates itself. For example, if you’re a hotel offering an all-inclusive package for a certain time period you could use an ad customization to display how many days are left for that limited-time deal.

2. Find an Intriguing Niche or Selling Point and Dominate it on the SERPs

With travel, finding attractive selling points is a piece of cake (or it should be)! When your industry prides itself on having fun, seeing the world from a new perspective, and gaining new life experiences, it isn’t too hard to appeal to searchers.

With that said, if everyone’s bidding on the same keywords and serving up the same offerings then life as a travel marketer could be a bit more challenging. You might not be the only genius promoting tropical getaways to freezing cold New-Englanders in January. “I’ve found myself competing with huge agencies like Expedia, Orbitz, and TripAdvisor, who are spending millions upon millions on AdWords each year,” says Bateman.

So your budget is limited and paying $20 a click to compete with TripAdvisor is not putting enough food on the table? Try these techniques to dodge your competition and dominate your niche:

• Find an unexplored niche: Do you own a beach-front hotel that offers windsurfing classes or paragliding adventures? Perhaps you run a tourism operation in Tuscany which leads truffle hunting excursions every weekend? Bateman spun his offerings to serve a much more niche audience when he realized his budget was becoming eaten up too quickly. “I’ve had tremendous luck with bird-watching packages – that was a niche that had never even been explored before. There’s lots of competition in travel, so it’s all about finding unexplored niches and dominating those in the SERP’s.”
• Ask, what makes us different? Does your hotel pride itself on its award-winning cleanliness? Does your airline have seats with 20% more leg room then the average airline? Popper really hit the nail on the head when explaining what makes InsightCuba different. “Our travel is not about laying on a beach and drinking daiquiris. It’s about truly discovering the beauty of Cuba by meeting people in real-life settings,” says Popper. “The memories our travelers cherish the most are the interactions with the local people.” Popper went on to explain a scenario that truly put things in perspective. “Maybe you travel to France and every morning you go to the same bakery, be-friend the baker, and study how he manages the dough. These are the stories and experiences that people are going to take home with them and become engraved in their memories.”

Bateman is another prime example of a travel marketer that knows how to stand out. “Since we live in Costa Rica, we give our clients real advice, as in I’m talking to you as I’m in the rainforest right now,” says Bateman. “We’re on call for our customers 24 hours a day, we charge no service fee for booking with us, and we offer custom vacation packages so you can add as many tours, transfers, and hotels as you’d like.”

So what does this have to do with AdWords? After you’ve found out what truly makes your travel offering unique, utilize this in your ad text, sitelink and callout extensions, and landing pages. For example, Popper uses taglines like “Discover Cuba through the people.”

Bateman set up callout extensions saying things like “Costa Rica Specialist – 24-hour advice” and “Local Knowledge – Real Advice.” Showcase your company’s distinctive offerings because this is what will guide them to book with you over your competitors.

3. Get Visual on the Display Network

Did you know that 67.5% of ads on the display network are plain text ads! Honestly, it’s still hard for me to believe…If you’re in the travel industry and you’re not advertising on the display network with visually captivating ads, then you must have something wrong with you.

This tip seems obvious to me because travel is probably one of the most visually captivating industries out there. Just walk around your office right now and check out how many desktop backgrounds are travel destinations.

“Just the image of the location can sell itself,” explains WordStream’s Paid Search Strategist, Sergey Rusak, who sees tremendous success with the paid search display campaigns he runs for his travel clients.

One of our clients at WordStream was seeing so much success with travel on the display network that they stopped doing a search! Although we would not encourage stopping search because that’s often where the journey starts, it should be clear to you now that display advertising is well worth putting some sweat and tears into when in the travel industry.

With that said, it’s important to make sure you’re doing it right. So aside from using captivating visuals, follow these additional tips below for display success:

• Create customized remarketing campaigns: Remarketing is extremely powerful for most industries. With travel, since the sales-cycle tends to be a bit longer and the opportunity to be insanely visually compelling is there, this makes remarketing even more profitable. “We get so many comments on how omnipresent we are because most people don’t understand how remarketing works,” says Popper. “They think we’re so smart we can follow them everywhere they go.” Set up remarketing campaigns that target people who viewed specific pages on your site or completed specific actions. For instance, if a searcher visits your landing page for white-water rafting excursions, follow them around with ads showing happy vacationers rafting down the river.
• Keep an eye on display campaigns and optimize regularly: “Display can be a black hole of money if you’re not careful,” says Swick. “After we refined our demographic targeting and contextual buys, we found great performance come from Display with several of our clients getting really high click-through rates.” Swick goes on to explain the importance of giving display the same love you give search. “We keep a close eye and use tight interest and demographic targeting. Sometimes we’ve found high CTR’s, but high bounce rates as well so then we’ll know to go back in and make sure targeting is set up well or optimize landing pages.”
• Make sure your images are contextually clear: As in aside from showing a pretty picture of a sunset beach, provide context of what the offer is within the visual to give the viewer a clear idea of where they’ll be directed if they click on your ad. “Visuals work well, but sometimes too well,” says Popper. “For instance, we’ll get a successful click-through rate and that’s great, but sometimes cost per lead goes up because you get someone who’s not necessarily interested in the product.” The ad below is a prime example of adding context to an offer. STA Travel presents a compelling visual, but they also provide just enough text to show where the user will be directed once clicking the ad, weeding out irrelevant clicks.

4. Create Trusted and Socially Validated Landing Pages

Let’s face it, traveling is a financial investment! When people book travel they’re providing confidential financial information, which is always a risk. This is why providing proof that your services are secure and legitimate is beyond necessary. “Trust signals are really important to us,” explains Bateman.

“We have client testimonials on every landing page, and we’re licensed by the Costa Rican Government and members of the National Chamber of Tourism. We want our visitors to understand that we’re trustworthy and reliable.”

Popper agrees. He’s found that providing customer testimonials as well as using trust-worthy language helps with converting landing page visitors. “You can travel legally to Cuba for the first time in 50 years. This message really resonates with people.

We’ve been licensed by the department of treasury since 2000, and we were the first to receive the license and bring America’s safety to Cuba under this provision so we make sure our leads are aware of this.”

Providing validity and trust is critical for users, so make sure to incorporate any legal certifications that your travel business has and clearly display customer testimonials so leads in the research stage of the funnel can be persuaded to book with you over your competitor.

Check out Insight Cuba’s landing page below, which has legal validity, customer recommendations, and testimonials from respected and well-known sources.

5. When seeing return, continue to add fuel to the fire

Another huge benefit of the travel industry is that opportunities to grow your reach are somewhat limitless. Of course, there will be niches that might not be as popular, but for the most part, travel is an industry that will always be alive and thriving. If you’re seeing success with a particular campaign, destination, or offer then don’t be afraid to raise your budget because with a higher budget you’ll likely get even more return.

Read Also: Using Integrated Marketing to Improve Customers Experience of Your Brand

So, keep a close eye on your campaigns, and for the ones that are yielding a profitable return, try upping your budget.

6. Expand to Bing

This tip can be relevant for many industries, but travel, in particular, has been one to show a great return on Bing. Also since competition can be a challenge, Bing gives travel marketers the ability to really own and dominate the search results.

Swick has seen great return through Bing Ads. “Bing’s gotten so much better over the last year. The numbers in terms of performance are great, but we do see more volume on Google.”

Moral of the story, focus on AdWords first and then set a chunk of your leftover budget to experiment with Bing because it’s typically cheaper with less competition – what could be better!

7. Subscribe to Google’s Travel & Tourism Blog

If you want to stay ahead of the competition you need to keep educated on the industry. Lucky for you, Google has a digital concierge to advice you on travel techniques and news in your industry. Subscribe, get inspiration from others, and keep up-to-date with changes to fuel your growth and success with paid search.

These tips should set you on the right destination to paid search paradise.