The Challenge
During 2023, Palladium Hotel Group achieved record figures, surpassing 1.000 millions euros in managed business volume. This represented a 16% increase in direct channel sales and 14% improvement in its Average Daily Rate (ADR) without significantly increasing its hotel inventory.
Following these historic results, we face the challenge of continuing to grow profitably, sustainably, and responsibly in the direct channel, anticipating a minimum 8% increase in Average Daily Rate (ADR) in 2024.
The Approach
Facing this challenge, we needed to develop privacy-first solutions that would optimize direct sales investments in real-time based on key business metrics: occupancy, cancellation, booking utilization, and Average Daily Rate (ADR). To accomplish this, we worked on a roadmap with a project plan focusing on scalability, customer knowledge, and a clear commitment to artificial intelligence to ensure sustainable growth and digital transformation of the company:
1) Developing predictive algorithms and audiences using 1st party data in Google Cloud’s VertexAI to improve business
metrics through activation across various Google advertising solutions (Search, PMax, Demand Gen, DV360, and Youtube).
2) Personalizing messages through dynamic creatives developed with generative AI to respond to each user in a
personalized manner and in line with their journey stage, using Studio, CM360, and t2ó’s AI suite.
3) Creating a Marketing Mix Modelling (MMM) model to quantify the impact of marketing channels, enabling more informed
decision-making (using Python and MMM-lightweight).
t2ó worked closely with the Palladium team in understanding their business needs for the creation of advanced
technological solutions that would have a direct impact on the company’s digital transformation. They were involved in the
strategic definition, creation, and activation across various advertising solutions.
The Results
Palladium Hotel Group has managed to anticipate the cookieless environment by developing solutions based on 1st party data that allow maintaining the growth of the direct channel profitably, sustainably, and responsibly. This has resulted in a 68% improvement in non-refundable rate revenues and an 18% increase in Average Daily Rate (ADR), while also achieving cost efficiency. The 360o investment planning and strategy (online, offline) respond to a scenario of global return on investment.
We find ourselves in a dynamic market, sensitive to changes in commercial strategy. Having an agency that understands the business and proposes advanced, scalable solutions has been key to achieving a 68% improvement in revenue with an 18% increase in ADR.
Alejandro Lazcano – Digital Sales Director Sr. – Palladium Hotel Group