Rinse, Lather, Repeat for Destination Marketers

“Rinse, Lather, Repeat” are the instructions imprinted on bottles of shampoo. The framework for washing your hair makes it easy to know what stage you are in, what you need to do next, and how to optimize your performance. If there were only a similar framework for destination marketers, we probably would lather a bit more because we wouldn’t be pulling out our hair. The framework does exist! It’s a modified version of the standard sales funnel, starting with Inspiration leading to Consideration and ending in Purchase.

The “bottom of the funnel” provides the easiest illustration of how it works. This is where the customer is nearly ready to purchase. They are looking for any type of pricing discrepancy, coupon, or discount. Sites and apps like Kayak, Priceline, Hitlist and Hotel Tonight are focused on the purchase. They are usually compensated through affiliate marketing since it is easy to see exactly who was responsible for the sale. However, there’s a reason why you choose certain airlines or hotels, isn’t there? Perhaps it’s based on what you’ve read, what others have said, or its online ratings. That’s where the consideration set comes in.

Prior to purchasing a product a customer may ponder all of the options in the consideration set. Ratings and review sites, research results, question and answer sites, and social media all fall in the consideration space. These are typically purchased by impressions or clicks and are measured by active engagement, which include social media following, more reviews, and more questions about the brand. You can read the comments about the Raffles Leisure Tour Packages in Sri Lanka, the ratings of the San Ignacio Resort Hotel in Belize or the reviews for Auberge du Soleil, but you may be wondering how these places even entered your consideration set in the first place, and that’s through the first step in the funnel: inspiration.

At the very top of the funnel is the trigger that puts the destination into our head: inspiration. Inspiration drives awareness and recall for customers to type your brand into the search engine and typically takes the form of storytelling or event marketing since our minds are best at spatial learning and understanding cause and effect. This format is typically purchased via “influence” or impressions and measured by passive engagement, like time spent reading and earned amplification, which is how much it is shared, retweeted or spread. Does visiting the beautiful countryside of New Zealand pop into your mind when you watch Lord of the Rings? Are you interested in visiting Limousin, France after tasting its eponymous beef?

To determine where in the funnel your strategy lies, ask yourself what the next step would be. Would the majority of folks purchase something after just learning about it (inspiration)? Probably not, but if they shared or spent time reading it and added it to their consideration set the campaign was probably a success. Did you receive more prospects requesting more information or following you on social media? Then your consideration campaign worked. Did they do all the research and are now ready to buy? If you are competing on best price or other kind of purchase incentive, then you are fortunately near the sale.

So how do you optimize the funnel? While each step in the funnel should seamlessly flow into the next to ensure the least amount of leakage, prospect loss is inevitable, which leads to basic customer acquisition cost.

Acquisition Cost = Cost per Purchase * (Audience Reached — Lost Audience to Consideration — Lost Audience to Purchase) + Cost per Consideration * (Audience Reached — Lost Audience to Consideration) + Cost per Inspiration * Audience Reached

To lower your acquisition cost, there is one final step along the funnel. Known as “Earned (or Social) Media,” it’s the practice of having your acquired customers retell their experience to their peers and thus inspiring their friends and peers to visit. It’s an effective form of inspiration and one that is probably more cost effective than any other channel. Tweets, status updates, and blog posts are an easy way to track and measure how well your customers provide inspiration. Thus: Inspiration-> Consideration->Purchase->{Repeat}. With this framework, marketing your destination is almost as easy as washing your hair… almost.

**The funnel has helped us greatly in understanding the effectiveness of various campaigns and how to optimize for best results. In that vein, we started The Travel Marketing Summit to help destination marketers understand the framework and how it can help them.

Originally published at www.trosmith.com on November 24, 2014.