91 - The relationship between Revenue and Marketing

How much should marketers be concerned about revenue? Tripadvisor and Perplexity partnership. The need for new concepts in hospitality. Retail should learn from hotel marketing.

Hello,

I’m trying to avoid the usual “here’s what to expect in 2025” articles. There are so many of them that I just can’t keep up anymore. Probably we should create a crystal ball GPT that has all of them and we can query it when we need someone’s prediction on a topic. But then we wont know what to query it with. This never ends. And with that, here’s this week’s newsletter.

Best, Martin

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Tripadvisor Perplexity

There was news this week that Tripadvisor and Perplexity are partnering up. It an obvious partnership for a language model, getting tons of unstructured data about destinations, hotels and travel into recommendations is going to help travel planning. However is this a “killer app”? booking travel through chat isn’t a great user experience. It can be a fantastic way to drive inspiration - find me somewhere to go this weekend with the family that is warm and within a budget of $3000 - is an obvious functionality.

TRAVEL PLANNING

Originality in Hospitality’s Future

I believe creativity and originality are crucial for the hospitality industry to thrive. Hotels should strive to create unique experiences that resonate with guests. Could the rise of new talents in the industry inspire a renaissance of creativity and innovation in hotel offerings? We need more great and creative concepts. In the post I argued that single audience hotels has been huge innovation so far. But that’s because such hotels can really do one thing well. Instead of being everything for everyone, which is just a place to sleep.

HOSPITALITY ORIGINALITY

About me: I'm a fractional CMO for large travel technology companies helping turn them into industry leaders. I'm also the co-founder of 10minutes.news a hotel news media that is unsensational, factual and keeps hoteliers updated on the industry.  

Basic AI Courses

There’s no real way to avoid it. The next few years are going to be fueled by AI technology everywhere. Searching and researching through an AI chat system and then coming back to the usual Google search experience is quite frustrating. But AI will be quite natural, just like we didn’t need a course in how to use a smartphone. However if you want to understand how things work and how you can build better things with AI, a course is often a good idea.

AI PROMPT DESIGN

Are OTAs Overcharging Based on Location?

An investigation reveals that OTAs may be charging higher prices based on the customer's location, with San Francisco residents paying up to $500 more for the same hotel rooms. Price discrimination is actually a revenue management strategy. Is it right? That is a little murky. 15 years ago the same thing happened where an OTA was charging more for guests using an iPhone or Mac. At least someone claimed that to be the case. It is becoming really hard to monitor price integrity. Which does impact the brand a lot. It’s not great when talking about the price becomes taboo.

OTA PRICE DISCRIMINATION

Online Retail industry should learn from Travel industry

Amazon has unveiled its Amazon Retail Ad Service at CES, a new advertising product that allows retailers to utilize Amazon's ad technology on their own e-commerce sites. Amazon made most of their operating profits from ads last year so it is normal to look for more ways to sell ads. But would hotels want to have ads for Booking on their website? When I watch the Retail industry I’m frequently surprised how they are following the same path that hotels and the travel industry has taken, but with 5-10 years delay. But the scale of the Retail industry is so much large than travel (Amazon made $50b in ad revenue last year which is more than double all of Booking’s revenue).

AMAZON ADTECH SERVICE

Podcast: I was invited on the Hospitality Daily Podcast and spoke about technology in hospitality, some thoughts on what wont change in hospitality, and why I co-founded 10minutes.news. Best, Martin

Opinion

Credit Stefan Sagmeister sagmeister.com

Marketing and Revenue should be working on the same KPIs

Sometimes I speak with marketing people and realize they have no idea how their work affects revenue—and worse, they’re not even interested. It’s surprising, because the whole point of marketing is to sell, so keeping an eye on revenue should be second nature.

I have plenty of theories about why this happens, and they’re not particularly flattering. In my opinion, those who don’t truly know how to do their jobs well shy away from KPIs that highlight accountability. It’s understandable: it’s uncomfortable to see your marketing campaigns have zero impact beyond vanity metrics. Nobody is immune to that; even legends like Ogilvy and Bernbach had their share of failures.

In my experience, the best marketing people often have some background in sales. They’ve had to convince someone one-on-one to buy a product. They don’t need to have been top-notch sales reps, but they should have at least some success under their belt.

When you learn to sell to one person, you develop a deep understanding of each crucial step in a good marketing plan: get the appointment, find the pain point, figure out how to position the product, present it, close the deal, seal the contract. If a marketing person can do all that, they can scale it into a broader marketing strategy.

The main takeaway is that marketing and revenue are intimately connected. Marketing, Sales, and Revenue (whether global or ancillary) should operate within one cohesive feedback loop, working together to drive growth.

Of course, you can’t measure all marketing actions through weekly or monthly revenue alone. Some brand-building efforts only pay off years down the line. But ultimately, every marketing endeavor should be aimed at generating more sales.

That’s why the joke about CMOs who start by re-branding or rebuilding the website rings true. It highlights how some people climb the corporate ladder based on maneuvering rather than performance. In fact, the first thing most good marketers do when they arrive is avoid touching the brand immediately and instead look for quick wins. Or, as I wrote in last week’s newsletter, they identify the real problem and fix it—and that problem is rarely the logo.

So, demand that your marketing team measure revenue.

PS: The risk is that they become fixated on revenue as a KPI—just bean-counting—rather than using that data strategically. But the alternative, ignoring revenue, is far worse.

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