Paid Search Test: Google Ads For Hotel Restaurants
Most upscale hotels offer on-site dining options, but only some have a dedicated marketing strategy. Dining brings in extra revenue from guests, locals, and even tourists, so why aren’t marketing campaigns more common for hotel bars and restaurants?
In this paid search test, we set out to determine whether it’s worth the time and money to use Google Ads for hotel restaurants. Are dining campaigns an underutilized gem? Or do hotels skip them for a reason?
The Paid Search Test
This test collected data from Quarter 1 (Jan 1 - Mar 31, 2023), covering five restaurants across the United States. Each restaurant was managed by and located on-site at a different upscale boutique hotel, with previous brand awareness varying between locations. With the exception of Property 4, each restaurant also contained a bar area, and these campaigns targeted bar-related searches along with restaurant-focused keywords.
During this paid search test, each property ran two separate dining campaigns: Brand Terms and Market Terms (Non-Brand Terms). These campaigns were single keyword ad groups, with Brand Terms focusing on the name of the restaurant and Market Terms focusing on its location or features (e.g. “Restaurant In Park City, UT” and “Rooftop Bar Near Me”).
The primary goal of each Brand Terms campaign was to promote business by increasing table reservations, while Market Terms was more focused on creating awareness and driving clicks.
Each campaign in this test started on Jan 1, 2023, and this freshness means that the data below does not reflect well-established and optimized campaigns. While some minor adjustments were made each month, the success of these campaigns does not rely on hours, weeks, or months of fine-tuning and management.
Brand Terms saw a Clickthrough Rate of around 40-50%, and Market Terms saw just under 10%.
While total monthly budgets varied, the average Cost Per Click was under $2 for all Market Terms campaigns, with the exception of Property 3, well under $1 for Brand Terms.
Table Reservation Rates varied by property, which could be caused by factors such as table availability, restaurant hours, and local competition. However, most properties saw Table Reservation Rates around the 5% range for both Brand and Market Terms.
See the below for full results.
Paid search dining campaigns are an effective and relatively cheap way to increase table reservations and generate awareness for your hotel’s restaurant.
While we are unable to measure how many times these campaigns influenced someone to visit the restaurant without reserving a table online, the data we do have is still incredibly promising. Metrics like Cost Per Reservation and Reservation Rate varied, but each campaign in our test saw an overall Revenue gain based on the average bill amount at each location.
Start with something small if you’re not ready to commit a large portion of your paid search budget to dining campaigns. With Cost Per Click hovering around $1, your potential for success is high even with a very limited budget. Property 5 spent less than $1,000/month on their dining campaigns and still managed to bring in over 3,500 clicks and 250 table reservations in their first quarter.
Overall, we highly recommend giving paid search dining campaigns a try. If you’re ready to start or just looking for more information, contact GCommerce Solutions.