Hotels should allocate 4-8% of total revenue to marketing, excluding payroll and franchise fees, for effective demand generation.
💵 Hotels should allocate 4-8% of total revenue to marketing, excluding payroll and franchise fees. Established hotels in stable markets spend less, while competitive urban properties spend more. Marketing budgets should allocate 50-60% to paid channels, 25-35% to owned channels, and 10-15% to earned channels. Effective budget justification includes identifying revenue gaps and using data-driven strategies to optimize return on ad spend (ROAS) and conversion rates. Optimal marketing can reduce reliance on costly OTA commissions.
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