Facebook Bid Multipliers for Hotels: A Crash Course

It’s a Catch-22. On the one-hand, segmentation allows Facebook advertisers to bid differently for high-priority audiences, but on the other hand, over-segmentation hurts performance and reduces overall efficiency. Enter bid multipliers – an important tool to maximize revenue while improving advertising efficiency.

Understanding Bid Multipliers: 30,000 Feet Up

Bid multipliers enable the use of complex, customized bidding strategies without the need to create several different ad sets with relatively small audiences. For hotel brands, that means consolidating the total number of ad sets while still reserving the majority of their budget for the highest-value prospective travelers within a target audience.

Driving Revenue and Maximizing Efficiency

At Koddi, we have leveraged bid multipliers to help our clients generate an impressive 25% increase in revenue and 22% decrease in cost per acquisition compared to standard segmentation alone. And with 14 different multipliers currently available on Facebook, the possibilities are vast. Here are just a few of the key ways that hotel brands can leverage bid multipliers to distinguish between different audiences and make the most of their budgets. With bid multipliers, you can bid differently based on:

• How recently a user visited the brand website
• Booking window or travel start date
• Length of stay
• The day of the week when travel starts
• Age and gender
• Device (desktop or mobile)
• Platform (Facebook, Instagram, Messenger, etc.)

How Bid Multipliers Work

Bid multipliers are built on defining the highest amount an advertiser is willing to pay to reach its most important audience segment. Then, multipliers are applied to decrease that maximum bid depending on the value assigned by the advertiser for that particular audience. Over time, Facebook will optimize budget to reserve the highest bids for only the highest-value travelers. On the flipside, the lower bids will then be reserved for lower-priority segments. This shift will result in an efficient program that utilizes audience segmentation without mitigating total spending power through over-segmentation. And it’s all contained in a single ad set. Here’s an example: Hotel Brand A develops a single ad set with a bid multiplier that states it is willing to dedicate 100% of its maximum bid to travelers looking to book at least a 5-night stay. For a 2-to-4-night stay, it’s willing to dedicate 50%, and for a single night, just 30%. Over time, Facebook ad spend is naturally optimized to dedicate the majority of dollars to longer stays – leading to increased efficiency within a single ad set.

How to Use Bid Multipliers in a Campaign

At this time, bid multipliers are only available to an exclusive group of whitelisted Facebook partners. Through Koddi, hotel brands can drive incremental revenue by taking advantage of the full suite of bid multiplier offerings currently available through Facebook Travel Ads. Learn more about the benefits of using Koddi Social, or drop us a line here. We’d love to talk.