Where the Gnome Roams1 Apr, 2016 By: Thomas Haire Response
Brad Wilson says the ‘Go & Smell the Roses’ campaign is a performance-based success story for Travelocity, online travel’s longest-tenured leader.
“Building brand and increasing our sales — with a performance-based marketing strategy, they are one and the same,” says Brad Wilson, vice president of marketing and general manager of Travelocity, the Dallas-based online travel agency that’s celebrating its 20th anniversary in 2016. “We are looking for any data we can to improve our entire traveler experience. We learn from customers’ shopping experiences to go acquire new customers as well. We look at performance-based metrics for how they impact brand. It’s the common terms — ROI, cost-per-acquisition, revenue-per-acquisition — but we actually marry those stats to the consumer and their Net Promoter Score (NPS) rating. We want customers who become promoters of our brand, and we want to make sure we are getting them at right price.”
With its roots online, Travelocity was one of the first major businesses built by the measurement tenets of Internet marketing. As the company grew rapidly though, its marketing grew to include all modes of media, including television and radio. In 2004, Travelocity introduced its now iconic “Roaming Gnome” to serve as an inspiration to its customers to urge its customers to “wander wisely.”
As Travelocity’s business grew, Wilson was making his own strides through the marketing world during stints with Match.com, Blockbuster Online, and Nutrisystem — gaining more knowledge and capability as a performance-based marketing expert in both the online and offline marketing worlds.
Celebrating his fifth anniversary with Travelocity next month, Wilson and his team were responsible for the 2013 launch of the company’s successful “Go & Smell the Roses” campaign. A powerful TV campaign, varied promotional activities, and upgraded customer relationship management (CRM) operations have helped accelerate direct Web traffic and sales — even during a period of transition. Online travel giant Expedia Inc., which had powered Travelocity’s North American websites since summer 2013 as part of a strategic marketing agreement, acquired Travelocity in January 2015.
Two Decades of Transition
That acquisition was just the latest transition for a Travelocity business that’s always been a leader in the online travel space. In fact, Travelocity was the very first online travel agency when it launched in March 1996. In its first three months, the site received 1.2 million visits and registered nearly 150,000 customers. By the end of 1996, Travelocity had more than 400,000 registered users.
The business associated with AOL’s travel portal in 1999 and then merged with Preview Travel in 2000, and — shortly thereafter — Travelocity became the third-most visited website in the world. In fact, by June of that year, Travelocity boasted 21.6 million registered users.
But, as with any great service, Travelocity’s success bred a group of strong competitors, including Expedia and Orbitz, in the early 2000s. As the online travel battles raged on, Travelocity found its footing once again by introducing the Roaming Gnome in 2004.
At the same time, Wilson was building his career as a leader in direct-to-consumer marketing. Shortly after earning his M.B.A. from Dallas’ Southern Methodist University (SMU), he joined online dating giant Match.com. There, he led the team responsible for driving more than half of new revenue and members through partnership distribution and online marketing.
From there, he moved on to Blockbuster Online, where he worked to nearly double its paid membership and helped launch the innovative Blockbuster Total Access program that combined online and in-store shopping experiences in a single package. But as Netflix outmaneuvered Blockbuster, Wilson transitioned to senior vice president of marketing and brand management at Nutrisystem.
There, he was responsible for brand stewardship across the portfolio of Nutrisystem brands, helping the business expand beyond its traditional direct response model to become a leading multichannel brand.
“I was fortunate to be able to move from one direct-to-consumer brand to another,” Wilson says. “Each business was about finding commonalities and what people hold near and dear — essentially, connecting people to their passions. Whether it was something as simple as entertainment, or something more life aspirational like losing weight or finding a life partner, these are all connection businesses.”
He adds, “In all instances — whether it’s something like Nutrisystem, with an impulse-driven response signal prompted in a specific time, or it’s something more involved like a travel experience — we always must focus on the customer, and we must seek out the data that can help us maximize their experience.”
When he joined Travelocity in May 2011 as the company’s North American chief marketing officer, Wilson carried these concepts with him. And, in 2013, he and his team launched the company’s “Go & Smell the Roses” campaign, which includes the popular Roaming Gnome. The campaign helped Travelocity record its three best hotel sales years in its history.
But as industry consolidation became de rigeur in the early part of this decade, Travelocity’s marketing agreement with Expedia — and then its acquisition for $280 million in cash — was not wholly unexpected. Expedia also owns and operates such well-known sites as Hotels.com and Hotwire.com.
At the time of the purchase 15 months ago, Expedia CEO Dara Khosrowshahi said, “The strategic marketing agreement we’ve had in place has been a marriage of Travelocity’s strong brand with our best-in-class booking platform, supply base, and customer service. Evolving this relationship strengthens the Expedia Inc. family’s ability to continue to innovate and deliver the very best travel experiences to the widest set of travelers, all over the world.”
3 Frames of Performance
Under new management, Wilson is responsible for the performance and growth of the Travelocity business and he remains in charge of the company’s marketing efforts. “It’s full ownership of the P&L, leading the team, bringing the brand to market, creating positioning with brand marketing, merchandising, CRM, service, and the shopping experience,” he says. He also leads the company’s multi-brand portfolio strategy across Expedia Inc.’s full suite of brands.
What that means on a daily basis is that Wilson and his team must remain focused but flexible — two things that a multichannel, performance-based marketing strategy addresses directly. “When we drive consumers with our outbound marketing — be it on TV, online, or elsewhere — we look at their activities closely after they visit the site,” he says. “Were they searching for a destination? How was the shopping experience? We look at the big metrics — organic repeat rate, NPS — to help us tweak and perfect our media. Can we drive a message that meets an unmet need of customers — and how are we best positioned to deliver that need?”
Wilson believes that the goals of driving sales and building the Travelocity brand are “not mutually exclusive.” He adds, “Performance-based marketing allows us to both drive sales and build brand. When you have a website like ours — or a mobile experience — there are plenty of elegant ways to ask for the business while keeping the brand strong.”
The company looks at its performance-based strategies in “three frames”:
- “From a performance-based perspective, when a new communication goes out — a TV ad, an online campaign, etc. — can we measure its impact immediately? We have to be more sophisticated, because travel is a deeply considered purchase, which leads to a lot of cross-shopping behaviors by customers.”
- “Communications must be timely — while we have that customer’s attention, are we doing things in the campaign to lift consideration for the Travelocity brand and drive transactions.”
- “When people don’t respond or close their transactions — say you shopped a Miami hotel for a given date but didn’t finalize the purchase — we must have the best mechanisms for retargeting to put that shopper back into the site at that same consideration point.”
With consumers seeking information on various parts of their travel plans — airfare, hotel, car rentals, and more — a true direct response campaign simply isn’t enough to drive Travelocity’s overall success.
“We’re looking for ‘quick performance’ marketing to drive you into the site, and then we try to identify whether you’re the right customer for us to invest the proper resources to secure your business,” Wilson says. “You can do action-based, signal response messaging — like traditional direct response — but it must build the brand because it’s likely to result in no immediate transaction. For us, we see that TV outreach as a starter from where we can build data and scoring to figure out which consumers we want to remarket to.”
And, Wilson says, price has become less of a factor in online travel as consumers have grown more comfortable with the sector. “Price is a factor, but not the factor for many,” he says. “Flexibility, best-in-class service and experience, loyalty rewards — all of these have become more important. It allows us to segment the market by spending more money and time to find out what matters to our customers.”
Smelling the Roses
When Wilson and his team launched the 2013 “Go & Smell the Roses” campaign, television was included as a crucial performance driver. “Our culture is a ‘test environment.’ Television is an environment where we can collect data on our effectiveness and what our customers think,” he says. “We’d be unwise not to use television.”
Wilson says that the Travelocity team measures and assesses all of its marketing efforts. “And, TV advertising — whether a single spot or a full campaign — is measurable and gives us signs of what works and what we need to improve,” he adds.
Wilson even says the wording of the campaign’s theme is a response driver. “Think about the message — ‘Go & Smell the Roses’ — the word ‘Go’ is a driver,” he contends, saying the inspirational bent of the campaign, including the witty use of the Roaming Gnome, sought to break Travelocity of a price-based advertising rut.
“Prior to the launch of this campaign, most of our messaging was about sales — 40-percent-off offers, or flash sales,” Wilson says. “The idea with this campaign was to stitch together an inspirational story, showing the gnome in indicative travel stories, combined with the call-to-action (CTA) — go and smell the roses!”
He says the campaign not only reversed a “three-year trend of declining brand performance,” but also drove three consecutive years — 2013, 2014, 2015 — of record hotel sales. “And hotels are our largest category, with the biggest margin,” Wilson adds.
As the campaign continues to drive new and returning customers, Wilson says that the Travelocity team has sharpened its focus in online marketing schemes, utilizing the continually growing and changing data from its customer acquisition advertising.
“For instance, we have a low index of online display advertising compared to other categories,” Wilson says. “Display is very tough, and not one of the best vehicles for driving performance or brand in the travel space. When we use display, it’s mostly in retargeting customers when we know what message we want to deliver.”
He says Travelocity has a “healthy affiliate network” that drives “good targeting” at specific times and for specific destinations. Wilson also says search is a major boon for Travelocity’s marketing plans.
“We spend a healthy amount in search. We can’t target at the consumer level, but we can target contextually,” he says. “With contextual data in the site, we can take part in sophisticated bidding in search auction environments. For instance, if I know someone shops for the Amanyara resort in Turks & Caicos, that’s a much higher-ticket customer. That’s someone I’m willing to pay more to reach than a consumer we’ve never seen before.”
Truly, what Travelocity’s marketing team is doing is operating a much more intelligent, higher-tech, data-fueled update of the old 80-20 rule. “We don’t treat all transactions equally,” Wilson says. “We believe about 25-30 percent of travelers drive 75-80 percent of Travelocity’s profitability. We want to ID them and drive organic repeat behavior from those shoppers that we want.”
Wilson’s belief in how Travelocity’s marketing team reaches consumers and drives their behavior comes from nearly two decades of experience in customer-facing, performance-based methodologies. But, he says, that experience doesn’t mean he ever stops learning or looking for new lessons.
“You continually see a new generation of marketers in e-commerce laser focused on response without looking closely at a set of customers,” Wilson says. “Before someone hits your site, you simply won’t know a lot about the customer. But if you pay attention to those customers’ actions once they’re there, eventually you get to a good place in optimizing campaigns.”
But, he says, that’s just the beginning. “Eventually, you hit a plateau, so you start to re-optimize,” Wilson adds. “Yes, you’ve actually penetrated a segment, but you have to reinvent to hit new segments and penetrate those — different messages, different markets, different media.”
Again, he points to the lesson of the 2013 campaign launch as a crucial moment in Travelocity’s success and his career.
“In 2013, most of our messaging was, as I noted earlier, price sensitive. The economy was still recovering, but as we looked at the marketplace and at our most profitable customers, their unmet needs were loyalty and a better service experience,” Wilson says. “What moved them to action? They liked aspirational travel and international destinations. So, after testing, we launched the “Go & Smell the Roses” campaign with five new spots in a single hour during an episode of ‘The Amazing Race.’ Overall, we had seven new spots, where most campaigns only have two or three. It broke convention in travel — a real campaign with a CTA and an aspirational driver.”
On top of that, Wilson says the campaign also pushed other key buttons. “We layered messaging around our service levels and the Travelocity ‘customer-first guarantee,’” he adds.
Recently, Travelocity shifted media companies, selecting New York-based Assembly to take over its U.S. media from Publicis Groupe’s ZenithOptimedia. The agency’s directive is primarily in the TV and digital space, with TV driving both reach and engagement, focusing on peak travel seasons, mixed with high-impact integrations featuring the Roaming Gnome.
“We look at agency partners as we look at any employee we want in our building,” Wilson says. “We want them to live the mission of our brand — to inspire people to travel and be their champion along the way. Second, we need them to live the culture of why and who we are — the value of the brand. It’s about testing and learning and improving every day. They must be great partners in data, innovation, and insights with the goal to constantly improve consumer experience.”
Looking ahead, Wilson believes the Travelocity team can continue to perfect the online travel experience that the company began two decades ago.
“Think about the legacy of online travel agencies and their role in journey. For many years, until we launched our 2013 campaign, they were firmly positioned in booking phase of travel,” he says. “But if you look at data points we’ve built on in recent years, two-thirds of people get inspired by friends’ travel recommendations. Three-quarters of consumers post on social media daily. Millennials share experiences and contact travel agencies via social media. It was our responsibility to extend beyond being just a booking engine.”
Wilson adds, “The Roaming Gnome’s purpose — and Travelocity’s with it — is to instigate people to travel. We want to be a champion for travel and make our customer-first guarantee come to life when you run into trouble.” ■