Travel is a tricky category.
It’s generally one of the top things people want to spend their money on – but it’s also not something most people get to do on a regular basis, said Sam Shank, CEO and co-founder of last-minute hotel booking app HotelTonight.
“In theory, people can use an app like GrubHub to order food three, even four times a day,” said Shank, who is also serving as HotelTonight’s acting CMO. “But most people only travel a couple of times a year at the most.”
That’s why HotelTonight, which has about 200 employees and more than 13.5 million downloads across iOS and Android combined, has to get creative with its acquisition, targeting and re-engagement – especially in light of the competition.
Unlike other online travel agencies like Priceline, Expedia, Travelocity and Orbitz, HotelTonight is app-only.
“But just because we’re mobile-only doesn’t mean anything if we’re not doing things better than the big guys,” Shank said. “We view everything through the mobile lens.”
And that includes video. HotelTonight hooked up with app marketing platform AppLovin to experiment with mobile video for user acquisition.
AppLovin has a dedicated in-house team that collaborates directly with clients to develop creative mobile branded video content informed by user behavior and engagement data pulled from AppLovin’s system.
“It’s an iterative process,” said AppLovin CEO and co-founder Adam Foroughi. “We do a lot of creative testing and optimization and we pass those learnings on to our design team.”AppLovin launched video on its platform less than a year ago, and in that time it’s become a “well over $100 million business,” said Foroughi, who noted that video is key to AppLovin’s overall growth.
And that’s because mobile video is no longer just the purview of game developers.
“If you’ve seen a mobile video over the past few years, odds are it came from a gaming company,” Foroughi said. “They jumped on the opportunity early because they understood that video campaigns produce high-quality users. But over the past year, we’ve seen more and more brands getting intrigued by mobile video.”
There’s a reason for that. According to recent research from Ooyala, mobile video consumption doubled YoY, hitting 38% in Q4 2014, with no signs of slowing down.
In Shank’s view, mobile video is also more affordable and trackable than TV, and provides a “good balance between storytelling, direct response and ROI.”
“Creating a TV campaign is cost-prohibitive,” he said. “The content alone could cost $50,000 to $100,000.”
HotelTonight used AppLovin to target travelers and business users across mobile apps, seeing particular success in both game and dating apps. Throughout the life of the campaign, AppLovin dynamically optimized performance around HotelTonight’s budget goals, winnowing the target based on response.
The video AppLovin created for HotelTonight centered on the app’s ease of use, riffing on the fun-loving spontaneity behind HotelTonight’s “Plan Less, Live More” tagline. But the video wasn’t just a branding opportunity – it also encouraged users to download the HotelTonight app, garnering a 326% higher install rate than previous HotelTonight acquisition campaigns. Cost per booking also dropped by 49% as a result of the campaign.
“Content is just as important as timing when it comes to retargeting and acquisition. Video ads are a great introduction because they allow HotelTonight to show the app and its functionality, [and] it’s also a great way to en-engage users because it showcases the use cases,” said Stephanie Messiter, director of performance marketing at HotelTonight. “But even if we aren’t seeing a high ROI on retargeting up front, we know we’re encouraging engagement. And the more a user engages, the more likely they are to convert.”
HotelTonight was so pleased with the results that it’s begun running the video as a TV spot broadcast in France. (AppLovin helped translate the ad into French.) It’s a trajectory similar to the move made by several of the big-name free-to-play apps, which ran TV ads during the Super Bowl, including "Game of War" and "Clash of Clans."
“You can see the line blurring between TV and mobile,” Foroughi said. “While it’s hard to know the exact economic impact of a TV campaign, on mobile, you can know the outcome of every dollar you spend.”