Anderson

If you're planning a vacation, chances are you've Googled destinations, checked out Expedia and read hotel reviews on TripAdvisor or the like. Savvy hoteliers will pay attention to how potential guests use social media.

So said Chris Anderson, associate professor of services operations management in Cornell's School of Hotel Administration, at an Inside Cornell event concerning the impact of social media on the hospitality industry Nov. 12 in New York City.

Social media have forged a "mutually beneficial relationship" in which hoteliers can take advantage of a new revenue stream and a wealth of guest-generated marketing research, and guests have user reviews and review scores at their fingertips to make peer-informed decisions on their choice of hotel.

"What clearly is one of the determining factors for guests is the reviews provided by other guests," Anderson said, adding that they pay attention to the content and quantity of a hotel's reviews. "It's crazy not to gather them and respond to them."

"It's worth the investment," Anderson added.

Citing his research based on data from the consumer websites Travelocity and TripAdvisor and from industry data sites comScore, Smith Travel Research and ReviewPro, Anderson said that social media has a substantial impact at time of purchase, specifically on price, demand and overall performance.

Using publicly available data from comScore, Anderson showed that 75 percent of consumers visited an online travel site such as KAYAK or Booking.com prior to reserving at a specific hotel brand's website. More than 80 percent of customers performed a Google, Yahoo or Bing search. Two-thirds consult both a search engine and a travel site, while only 10 percent of consumers went directly to a hotel's website. The percentage of consumers visiting social media site TripAdvisor increased from 26 percent in 2008 to more than 35 percent in 2010; the majority of these visits occurred during the few days prior to making a reservation as consumers use reviews to select a specific hotel.

Using data from Travelocity, Smith Travel Research and ReviewPro, Anderson quantified the impact of social media on hotel performance, indicating that improving review scores have substantive impact at the time of purchase as well as on overall hotel performance as measured by average daily prices, occupancy and revenue per available room. The impact of review scores increases with hotels with fewer stars.

R.J. Friedlander of ReviewPro joined the discussion to differentiate user-generated content from travel sites and Twitter and Facebook. The latter two are "leveraged for service recovery, an extension of customer service," in which on-site guests may tweet or update their status in real time, and hotels, such as the customer-centric citizenM Hotels, monitors these experiences and resolves issues in real time.

As for the previously cold guest whose air conditioning has just been turned down, he might hop onto TripAdvisor and raise the hotel's review score.

Caroline Shin is a freelance writer in New York City.