Video on How Much Does Conversational Marketing Cost and What Is My ROI
Hi, this is Tom from O’Rourke and today I would like to answer the question of “what is the cost of conversational marketing?” and if I do invest in it, “what will be the return on my investment?”
If you’re a hotel owner today or a hotel marketer, you’re probably hearing this term conversational marketing more and more, and it’s really a pretty new, dialogue driven approach to marketing through a one-to-one interaction, on platforms such as live chat, chat bots and other messaging apps.
So, what I’d like to do is answer that question today about cost and ROI. Let’s take a look at what we’ve built here from a wedding calculation standpoint. I’m going to be very conservative, answering the question of how many site tours, booked through conversational marketing each month. We’ll say two.
Next question is if I have two site tours, how many weddings would I convert from that, let’s say 50%.
Next question is how many guests do you have in an average wedding? We’ll say 150 guests.
Next, what is the average cost per head? $200.
What’s the daily rate of your property? $200 program.
How many room nights on average? What we mean by this is if you have 150 people attending the wedding, not everybody’s going to stay that night. So, we’ll plug in 100 room nights.
So now we’re ready to make the calculation. Here on this screen, you’ll see the estimated return on investment. Go back to the calculation of two site tours booked, and we had a conversion of 50%. So, we generated, between the revenue from the wedding and the number of roomnights, we generated $50,000.
If you annualize that and you do that once a month, you would generate $600,000 a year in for weddings revenue.
That brings us to an ROI ratio of 20 to one. How do we get this? We take the $600,000 divided by the $30,000 for the cost of the software to bring us to the 20 to 1 ratio.
So, as you can see here, there’s not a big risk to adopt conversational for your property.
If you would like more information on conversational marketing, please head over to www.orourkehospitality.com, click on the Insights link and choose the topic, Conversational Marketing. Thank you very much for your time.