IHG Leverages CJ to Shift Consumer Perception and Increase Direct Bookings
Nov 14, 2018
With an increasing cost of sale due to consumer booking behavior shifting to a reliance on third-party vendors, InterContinental Hotels Group looked to CJ to drive an increase in direct-to-brand bookings.
There's been a fundamental shift in the way customers book hotel rooms. Perceiving them as better value, many have become reliant on online travel agents. But in reality, the commissions charged by online travel agents mean that this shift in consumer behavior has increased the cost to both hotel owners and consumers.
Yet according to InterContinental Hotels Group’s (IHG) own research, brand loyalty remains a key driver when booking directly with a hotel brand. In fact, IHG’s research showed that far fewer members of their customer loyalty program, IHG Rewards Club used online travel agents, compared with non-members.
To achieve the best possible value for money for their customers and themselves, IHG needed CJ to help them maximize the number of customers booking directly through them, rather than via more costly alternatives.
The primary goal of the affiliate strategy for IHG was to increase the brand’s direct bookings by challenging the existing booking pattern of guests. This would bring down costs for hotel owners and customers alike. To achieve this, the teams at CJ and IHG set out to achieve the following objectives in 2016:
Increase direct-to-brand bookings
Increase the acquisition of new IHG Rewards Club members
Represent value for both IHG and their customers by keeping the cost of sale below that of online travel agents
Build stronger commercial partnerships with publishers to encourage long-term program performance
Together with CJ, IHG created a pricing initiative that offered guests the best market price if they joined and booked directly through IHG Rewards Club. This Lowest Price Promise campaign was launched via IHG’s European affiliate program, drawing on collaboration between various teams across IHG, alongside CJ’s technical capabilities, knowledge of the affiliate space, and international publisher network.
To increase direct bookings and challenge guests’ existing booking patterns, the teams at CJ and IHG devised a new-to-market campaign with content partner Head for Points. The exclusive venture, leveraging the power of the content model to inspire and advise as a springboard for the generation of bookings, was set to run alongside existing, high-performing cashback and voucher site campaigns.
The pricing campaign succeeded in increasing channel shift away from online travel agencies and towards IHG’s direct online channels. Further, because the campaign leveraged a discount that was exclusive to members of IHG’s loyalty scheme, it drove a significant increase in enrolments into the IHG Rewards Club. Consumers were convinced that direct-to-brand bookings offered them the best value.