Conversion, in online marketing refers to turning hotel website visitors into bookers on a hotel website, i.e. turning lookers into bookers.
The conversion rate is the proportion of bookers to lookers and is calculated as follows:
Conversion tracking is performed on the hotel website with help of site statistics tools such as Google Analytics. The visit is tracked through to completion of the booking in the hotel booking engine. To do this, a cookie – provided by Google – will have to be set in the confirmation page of the online booking engine. Not all hotel booking engine providers allow for this, so be sure to check before you sign a contract.
In Google Analytics you then see, how many website visitors have actually booked, were thus converted. You also see how much they spent if E-commerce conversions are set up as opposed to just goal conversion.
If search engine marketing is in place, i.e. Google AdWords ads are running, you can easily calculate the ROI (Return on Investment). Return on investment measures the ratio of your profits to your advertising costs.