Determining ads budget for hotels cannot use a generic approach. Each hotel type has different target markets, room prices, and marketing strategies. Therefore, the budget must be calculated based on revenue potential, cost per acquisition (CPA), and the channels used.

Basic Formula for Determining Ads Budget

Budget = Target Booking x CPA (Cost per Acquisition)

Simple example:

• Target: 100 bookings
• CPA: Rp100,000
• Budget: Rp10,000,000

1. Budget Hotel (Low to Mid Range)

Characteristics

• Room price: Rp200,000 – Rp500,000
• Target market: price sensitive
• High volume, smaller margin

Ads Strategy

• Focus on booking volume
• Use high intent keywords (cheap, close location)

Budget Estimation

• CPA: IDR 50,000 – IDR 80,000
• Target booking: 150–300 / month
• Budget: IDR 7,500,000 – IDR 24,000,000

ROI Estimation

• Avg booking: IDR 300,000
• ROI: 300% – 500%

Channel Placement

• Google Search Ads (primary)
• Google Maps Ads
• Meta Ads (retargeting)

2. 4-Star Hotel

Characteristics

• Room rate: IDR 700,000 – IDR 1,500,000
• Target market: mid-high segment
• Balance between volume and margin

Ads Strategy

• Combination of branding + performance
• Visual & storytelling are important

Budget Estimation

• CPA: IDR 100,000 – IDR 200,000
• Target booking: 100–200 / month
• Budget: IDR 10,000,000 – IDR 40,000,000

ROI Estimation

• Avg booking: IDR 1,000,000
• ROI: 400% – 700%

Channel Placement

• Google Search Ads
• Meta Ads (awareness + retargeting)
• Display Ads for branding

3. 5-Star / Luxury Hotel

Characteristics

• Room price: IDR 2,000,000+
• Target market: premium
• Smaller volume, high margin

Ads Strategy

• Focus on brand positioning
• Visual experience & premium storytelling

Budget Estimation

• CPA: IDR 300,000 – IDR 700,000
• Target booking: 50–120 / month
• Budget: IDR 15,000,000 – IDR 84,000,000

Estimated ROI

• Avg booking: IDR 3,000,000
• ROI: 500% – 900%

Channel Placement

• Google Search Ads (high intent)
• Meta Ads (visual storytelling)
• YouTube Ads (brand experience)
• Programmatic Display

Comparison with OTA

If using OTA with 20% commission:

• Budget hotel: losing IDR 60,000 / booking
• 4-star hotel: losing IDR 200,000 / booking
• 5-star hotel: losing IDR 600,000 / booking

In many cases, CPA from ads is lower than OTA commission, so direct booking is more profitable.

Ideal Budget Allocation Strategy

• 60% Google Ads (high intent)
• 30% Meta Ads (awareness & retargeting)
• 10% testing new channel

Tips for Optimizing Ads Budget

• Focus on keywords with high intent
• Optimize landing page
• Use retargeting to increase conversion
• Scale profitable campaigns