A Case Study in the ROI of Online Virtual Tours
By Joseph L. Ortiz, VP - General Manager, IPIX Immersive Still Imaging Group
Some companies in the hospitality
industry consider a simple online
presence to be all they need in order to
compete. For these companies, one or
two pages with a company logo, a street
address, contact information, and a
couple of photographs are more than
enough to represent the business to
those searching online locally. As a
requirement for doing business in the
Internet age, it is often difficult to quantify
the return on investment of this type of
basic Web presence.
Intuitively, it is easy to see the damage a
lack of a simple Internet presence can
have on even the smallest bed &
breakfast. Conversely, the marginal cost
of developing a one or two page website
is comparable to a days’ utility bill or less.
Clearly, the vast majority of the
hospitality industry has embraced the
power of online content. The question is:
have we all harnessed its full revenuegenerating
potential?
Large companies with larger marketing
and business development budgets
generally offer a more complete Web
presence as a matter of course. These
companies’ web presences include a
wide range of value-added features,
including driving directions, city links,
weather, and current events. For these
broad reaching companies, the return on
investment may be even more difficult to
quantify due to scale, and as a result,
there is not always an appropriate level
of investment made in creating a highlevel
of user-driven interactivity on the
site. Quantifying customer-pull and sellthrough
because of online content is
often seen as a complex, if not
impossible, task. However, the quality of
a compelling and user-friendly hospitality
website is simply apparent from the first
click to the last.
Virtual tours, which can provide stunning
full-360º color photography of properties,
allows business and leisure quests,
conference organizers, wedding
planners, and other prospective guests to
appreciate the amenities and ambience
of your unique establishment. Even so,
hotel management often considers
providing compelling, interactive web site
content as just a “nice-to-have” due to
inherent costs. In a down economy, this
perspective stalls out web site renovation
and makes it difficult to justify upfront
costs and to quantify ROI afterwards.
The reality is that virtual tours can be the
perfect interactive content in which
property owners can wisely invest.
According to research by Gómez
(www.gomez.com), travel-related
products and services are the #1
purchase made by consumers over the
Internet. Additionally, while only 15% of
all hotel bookings are made over the
Internet, 65% of all travel bookings are
researched online. The Internet has
become the top choice for consumers to
investigate travel destinations, whether
for business or leisure. For property
owners, virtual tours are compelling and
cost-effective interactive content to
market to these potential guests.
Many top tier companies, including
Carlson Hotels Worldwide
(www.carlson.com) have embraced
virtual tour technology. Carlson Hotels
Worldwide includes Regent International
Hotels, Radisson, Park Plaza Hotels and
Resorts, and Country Inns & Suites by
Carlson. Radisson, in particular, has
actively embraced virtual tour technology
as a way to market better than the
competition online. They are aggressively
moving forward with dynamic and
interactive content to make their sites
user-friendly and informative. Even more
so, they have been able to measure and
quantify the high ROI for virtual tour
photography. Tying the benefits of
interactive online content back to
revenue is not as difficult as it might
seem.
Gino Giovannelli, Sr. Director, e-
Business Strategy for the Carlson
Consumer Group explains that they have
now done virtual tours for over 165
Radisson Hotels in 11 countries,
consisting of over 3,000 IPIX images.
Consumers expect rich media from
hotels and resorts and the Radisson
Internet web site has become an online
brochure with lead-forward content that
draws visitors into the web site and
supports the dynamic brand of the
company. Mr. Giovannelli has said that
they are now doing virtual tours for our
other hotel brands as well (Country Inns
& Suites and Park Inns & Park Plaza).
© Copyright 2003-2005 IPIX Corporation. All rights reserved.
Radisson actively measures statistics on
their web sites and have a clear view of
what its return on investment is:
• Hotels with a virtual tour achieved
135% increase in online revenue
amounting to $7,200 per hotel per
month over those without a virtual
• Return on investment (per hotel) = less
than 4 weeks
• Average 2,000 views per month
• Radisson Aruba = Average 16,000
views per month
• Radisson Lexington New York =
Average 9,000 views per month
• Radisson Edwardian Vanderbilt Hotel
= Average 3,000 views per month
• Radisson Adelaide, Australia =
Average 1,400 views per month
• 4% conversion rate = bookings made
through the virtual tour page only
(NOTE: This does not include bookings
made by people who saw the tour and
then made the actual reservation over
the phone)
One of the ways Giovannelli has been
able to achieve a high rate of return in
the use of virtual tour technology has
been through the use of a full service
professional virtual tour service provider.
Professional virtual tour service providers
nearly always do excellent work, both on
property and in their backend support.
The hotels are generally more than
pleased.
Giovannelli chose PhotoWeb
(www.photowebusa.com) as Radisson's
preferred vendor for virtual tours back in
1999. He chose them because they were
the only vendor who was willing to be a
"full service provider" to the Radisson
brand. This was key because they had
many vendors bidding the work, but most
only offered photography services, which
would cause the rest of the development
work (such as website development and
hosting) to fall in the lap of hotel
management. PhotoWeb said they would
be a one stop shop for shooting the
tours, hosting images, building and
hosting virtual tour web pages, creating
CD-ROMS, and setting up all the tracking
for each hotel. PhotoWeb said they
would take care of everything…and,
according to Giovannelli, they have.
The return on investment for virtual tours
is high for companies that embrace them,
and the startup cost and complexity can
be effectively managed with a full service
provider like PhotoWeb. Measuring the
actual return on investment can be made
easier since full service companies like
PhotoWeb capture raw statistics on
page-views, unique visitors, and virtual
tour views.
When managed as a business tool,
virtual tours are more than just
compelling images. They are an effective
visual technology for creating demand
and generating incremental bookings.
Joseph Ortiz oversees the Immersive still
Imaging Group at IPIX. In this role, Joe is
responsible for providing tactical and strategic
leadership for the Group’s sales/business
development, operations, and product
development on products such as the
patented IPIX 360 Suite Pro Imaging
Software. Joe holds a Bachelor of Science
Degree in Computer Science form Georgia
Institute of Technology, a Masters in
Computer Engineering from the University of
South Carolina, and a Masters of Business
Administration in business marketing
management form Arizona State University.

for samples on vr see www.eyemaginelab.com

Last edited by rommel canlas (2006-12-17 21:31:52)