182 Online advertising in Costa Rica: Tourism Hospitality & Real Estate

[Richard Bexon]

Good afternoon, Jelena, how are you doing?

[Jelena Radic]

I'm doing great, thank you.

[Richard Bexon]

That's sick. Well, it's a pleasure to have you on the podcast. I always say it's kind of weird when I've known people so long getting on the podcast, but I think what you do is very unique and, you know, your insights need to be shared and also the services that you offer, because I think it's very useful for a lot of people out there.

[Jelena Radic]

Yeah, thank you so much for having me. And, I mean, from my perspective, like marketing, everyone is into it right now, so I don't feel like it is that unique, but I do have a lot of experience. So thanks for having me.

[Richard Bexon]

Oh, I think there's a lot of people doing it. I don't think there's that many people doing it successfully, Jelena. And I know with the marketing budget that you've managed over the years and your knowledge, as I said, I think you can be a great help to everyone.

But the question I like to ask always to get a kind of where we start is to get an idea of kind of what's happening in the market. I mean, you know, it had a kind of good comeback in 2023, real estate in North America and Europe seems to kind of flatline or decline in most areas. But I mean, how is online demand looking at this year compared to last?

[Jelena Radic]

So I was mostly working with travel industry, so I can give you an idea there. It is really year over year trending a higher, like a 15 to 25% rate. So that is really, that market is also behaving slightly different from real estate, right?

So in that sense, and specifically for the market that is like US market coming to Costa Rica, I'm talking mostly about that when I'm talking numbers. That's been on a steady increase year after year after year, like three years in a row. So things are really looking great in the travel industry right now.

[Richard Bexon]

Awesome. Well, and you know, I always say to people like, look, you have to understand if coastal real estate is driven by tourism, meaning that when a lot of people are coming to tourism areas, it drives real estate. I think what we're seeing is, and I mentioned it in key areas, real estate is still strong, if not increasing.

What's happening is those areas where it started to spread out 5, 10 kilometers outside, that started to reduce, meaning that like the demand for that stuff is not as much because the hysteria or the free cash that's available out there is not as crazy. So it's just kind of contracting a little bit around those areas. But I mean, are there any particular areas when you look at online search demand in Costa Rica that just have great strength?

The demand by the city is just incredible.

[Jelena Radic]

I think that's happening a lot for the north coast of Guanacaste, like areas like Tamarindo. Probably I've seen on the trends for travel like Arnal or areas like Manu Antonio in Capos and south of Pacific as well, like Vida showing up like this, this destination was five years ago, nobody knew about it. And now it's really showing up on the tools that I'm using that are related to like Google searches.

All of them, Playa Herradura as well, Jaco super busy, I would say with development too. You correct me if I'm wrong there. But I think all the main destinations do have more and more interest, specifically as the knowledge of people that are coming here experiencing stuff on their travels, like then they are learning about destinations, they are liking certain ones more than the others.

Beach is always an exciting one. And there's always a lot of stuff going on there. So those are, I think, the ones that are getting the most attention.

[Richard Bexon]

What would you say the top two online search destinations in Costa Rica are? I always ask that because the reason here is like, I'm always looking at trending destinations, which some of them that you mentioned there is because, again, tourism drives real estate in this country. So if I look up online searches of where places are starting to get their own brand, I go and then look for real estate in that area.

And especially with a lot of the investors that I work with real estate in that area. But like, just from a pure demand perspective, I mean, what are the top two or three locations in Costa Rica for online demand?

[Jelena Radic]

So the leading one was always Manuel Antonio, I would say, the Marindo, Guanacaste as a region. But what was emerging lately is like La Fortuna, Arenal Volcano area. And then also places like Santa Teresa that have been hyped a lot, like the whole Nicoya.

And I do think there's more and more visibility on those. And then I would say probably Jaco is among top five as well. What did I skip?

I feel like I skipped something.

[Richard Bexon]

Hey, no, I mean, look, I think it's Manuel Antonio, Camarindo, as you mentioned there, Arenal, Jaco. I mean, again, Santa Teresa and Osada are the main destinations. I mean, that just backs up the occupancy rates and average daily rates that we have in those areas as well.

I mean, where do you think that, I mean, there's a lot of people doing online advertising out there. You know, I mean, everyone in their, I don't know, grandma knows someone that does kind of online advertising. But where do you find most people waste money on online advertising?

[Jelena Radic]

So that one is tricky. You can do it in different ways. But when I take on the account and start digging, most of the time, if people are doing it, there is some kind of a leakage in the funnel.

And what I mean by that is like, tracking is not properly set up. And I think that's the one that's becoming more and more difficult to ignore. Because the way that the advertising tools are changing is that they're trying to work with this feedback group of like, okay, which users are converting?

If that makes no sense to anyone, what does that mean? It's like, if you have website visitors, are they inquiring? Are they booking?

If you are not sending that information in an automated way to the tool in question, whether it's Google Ads or Facebook or whatever platform you're using, then that platform struggles to learn and understand which visitors are more valuable to you. And then it actually spends your money. But without that learning moment, it doesn't really deliver you the quality users.

So the ones that will convert. And this was not the case, like, five years ago, you could do even run campaigns successfully, I would say under quote, marks, but it would still function. Nowadays, that doesn't really make much sense.

Then the other one is not knowing your audience, not knowing how to set your audience. Tools are getting better at educating their people that use them in this sense. But you can still turn on a campaign and just have completely wrong audience there.

And then there, people are not buying your product or booking. So those are the two big ones.

[Richard Bexon]

I looked at a campaign the other day for a client where another company was running it, and it was for a luxury property management company, and they had it turned on to Costa Rica. And I was like, what do you like your clients in North America? Like, are you spending money in Costa Rica?

Like, well, because you know, Costa Ricans have money as well. And I'm like, I get that. But like, what percentage of your clients are from North America?

They're like, well, probably about 90%. And I'm like, but 90% of your budget is focused on Costa Rica. Like, it doesn't make sense.

But I mean, it's just, again, when you have people doing stuff that don't really understand the audience and the client you're going after, it can be difficult.

[Jelena Radic]

Yeah, that's one of the main things in marketing is to like, you have to know your audience. And that's an ever learning loop, because they change habits over time, you have to keep up with that. And I would also say, the one thing in marketing that you want to really do well, if you have a brand is to like, be the first brand that somebody remembers once they're ready to buy, but 95% of people are not ready to buy today.

So you do have to market to people that are not ready. Because what you want to achieve with that is actually to once they are ready to buy, that decision has already been made, or almost there, you know, just need to confirm it. But so how big is retargeting then Jelena?

[Richard Bexon]

Like how big part of that of your campaign should retargeting be?

[Jelena Radic]

Well, it depends on the business depends on how mature your setup is. Like, there are some limitations with the business that are just starting, obviously, then you need to focus more on building brand awareness and doing stuff to that. Once you have that funnel going, and it is significant, there are even limitations within the tools.

Like you cannot run remarketing campaign unless your audience is like, at least 1000 users. And it's actually that's the minimum, right? It needs to be bigger.

So it needs a moment for it to build up once that is there, though, that that can be a really significant resource for you. And I would say, well, really depends on the business, but I think probably not less than 20-30% should be allocated to a remarketing efforts and even higher if you were seeing good results.

[Richard Bexon]

Well, but just because you've mentioned that, I mean, sometimes people come to a website, you know, and they're not ready to buy there. And then they're looking at kind of top of the funnel. But, you know, retargeting kind of just keeps targeting them, I suppose, you know, I mean, there are many, many people who just like the only reason I inquired with you is because I saw you everywhere.

Everywhere I went, you guys followed me. And it just that brand awareness just keeps, you know, building with that individual.

[Jelena Radic]

So there are layers to it. Retargeting is one strategy you can deploy. Another one is also building that trust over like email campaigns, like if they are inquiring and then they, you know, stop, then you try to educate him on what you're doing.

What is your whatever your business is like, you just keep not just trying to be too salesy and push your product, but also help them understand the intricacies of your business and of the whole like whatever they're looking for, and then why your business is built in a way that it is. So it helps them. So you kind of target, you know, we're maybe getting way too abstract in this sense.

But like for travelers, that is really like, you know, educating them on the destinations, things they can do for real estate. I guess that that would be also like what can do with that real estate, right? If you're looking to buy for yourself, then that's a completely different story than if you're looking to buy to to have some kind of a revenue income.

So so those are but then you you have so much to educate them on that it's really that's how they can only and I think you're doing a great thing with podcasts, by the way, in that sense, because that's that's really showing your expertise for the people that are interested and know nothing about real estate.

[Richard Bexon]

Yeah, well, I mean, I mean, I just kind of started it and it just kind of just went off and you know, 182 episodes later, I'm hooked. So and people seem to find it interesting. So I continue to do it and get people on here and etc.

But I mean, what do you think people should understand about hospitality tourism advertising in Costa Rica?

[Jelena Radic]

Wait, so with hospitality? Sorry, I need to read. No, no, it's fine.

Can you say your question again?

[Richard Bexon]

I can splice this together anyway.

[Jelena Radic]

Okay, thanks.

[Richard Bexon]

I just forgot what I think you said here that the average internet user the age of time big OTAs, you know, Expedia, etc. that understand Costa Rica bigger, there's a big shift in volume of keywords, you know, building your site with good content, which you kind of, you know, had there, but I mean, I think it's just about the okay, probably competing with the big guys, right?

[Jelena Radic]

Ah, okay. Yes. Sorry, I can I can go back.

[Richard Bexon]

I'll pause and we'll start again. Okay.

[Jelena Radic]

Okay.

[Richard Bexon]

And Jelena, what do you think people should understand about hospitality tourism advertising in Costa Rica?

[Jelena Radic]

Yeah. So that one is an interesting one. It over the years that I've been doing this, it really changed.

Like 10 years ago, people knew Costa Rica only in the OTAs, which are online travel agencies like Expedia and booking did a lot of like legwork on educating users outside of Costa Rica on Costa Rica, like destinations, specific brands. And then even small smaller properties started, because this was a this was a pain, like smaller properties were not using these tools, you were not able to find hotels on them, many, like maybe some, but I think over 50% were not on them. And then once they actually started adopting these tools, and they started learning more about the whole online business and how powerful that is.

And then also, visitors outside of Costa Rica also started learning more about Costa Rica. So the keyword shift is significant. Like right now, you can see a decent volume of keywords for a lot, like more than 20 different, I would say, like probably close to 50 places, destinations in Costa Rica, that would like you wouldn't find like five people outside of Costa Rica that haven't been to it that heard of it before.

So there's, there's that, like, it's getting more specific, which if you are buying a property in one of these places, it is helping you, like narrow down your audience and advertise to people that have knowledge and an idea where they want to go and what they want to do. And then the other thing is that once once you use OTAs for your business, which which you can and it's but they are, you know, charging you a fee for that. You can, like you learn a lot about actually how all of that works.

And you can use that knowledge to then work on your if you if you're doing it by yourself, you can then build your brand and your website and start doing more of the things that are like directly helping you to be present online in a better capacity to specific audience that is looking for whatever you're offering. So yeah, I think that the whole online travel agencies business is actually helping you get there.

[Richard Bexon]

Yeah, no, I mean, again, I think it can sometimes bring brand awareness to the client. And then a lot of time the client sometimes go and find it directly, but sometimes not because again, you know, these OTAs are also bidding against your own brand name as well. Yeah, so it's it's very interesting.

And then the URLs are very interesting when they start working with them like, you know, it's, it looks like the URL for the website of the actual hotel, but it's not. And yeah, it gets very confusing sometimes.

[Jelena Radic]

Yeah, I think that's when you get a bit more mature in your business. And then you need to like strategize a bit more about, okay, what kind of presence I want to have on the OTAs versus direct, and you start playing that game. And yeah, I mean, it's, it's also this industry, like advertising in general, it's so intense in changing, like they're, they keep try always to keep up with the latest technologies.

They also have, like, challenges with privacy laws that are like, they're, it's making them change the game, like completely, all the time. So in order to keep up with all of that, and what does that actually mean to like a campaign you're running? It you neither, either need to be heavily involved.

Or the other case is that you actually get someone else to do it. That that is from the industry. So yeah, that's, that's a thing with marketing online.

[Richard Bexon]

Well, I mean, look, I mean, I think when a company is large, they can have their own in house kind of advertising marketing team when you're small, you have to outsource it, what you could do it yourself. But I mean, sometimes outsourcing it to someone that's working on 10 or 15 other campaigns can be helpful as well, because they can use like the lessons learned from that, etc. You know, it's that balance lessons learned between do they have too many clients, and I'm not going to be that important.

But, you know, that's where I believe in just weekly meetings on stuff with whoever you're working with, to make sure that it is important to them, right? You know, it's your job as well to, you know, it's not a one way street, you have to kind of make it important for them as well. And also for yourself.

So true. Yeah, I mean, what is a decent budget to have or to have any impact on AdWords and Facebook? I know that that's a very weird kind of, you know, and it depends on the business.

But I mean, if you were to give us a number towards the end of, you know, what you're about to tell us here, are we talking 100? 1000? 2000?

I mean, yeah, I mean, give us an idea.

[Jelena Radic]

So yeah, you can even start with like 200, probably a month, but that really limits you on what you can do with that. And in these cases, like Google, specifically the search part, because Google also has like the display and remarketing. So it has a very developed range of tools that you can use.

With search, if your industry is competitive, and like tourism industry or real estate kind of is, you have to be very knowledgeable on like how to set it up and just not completely waste it. And I mean, it is it is really a small budget, but I would say, like, at least 1000. I know it's a big number, but it is something that actually can give you traction for learning and understanding, like getting it straight.

The more you spend, the better it is. It's efficiency, I'm sure. Yes, it kind of learns, understands, like it can deliver then better traffic to your site.

So I do think the important part is, like you want to play the long term game, because SEO or search engine optimization, which is like ranking organically without paying, is part of it, because actually they complement each other. So while you're actually trying, the paid traffic at that beginning stage is really to see if like, this is working or not, like whatever you're trying to test out. But it's not really a long term.

Long term is really what you want to be. And that's SEO, because it doesn't give you results immediately, it needs several months for the traffic to start showing up consistently. But once it does, it is there.

And like, it is there to stay if you continuously work on optimization. So those two are complementary. The Facebook platform is, I think, great for retargeting.

So that's, and that's the one that is, I would say, safer one, if you know your audience, because you have to know your audience to set it up and not waste the money. So if you know your audience, try to keep it like on a tighter end while you're starting, so it learns well, and then you can go and expand. And that one is in that sense, like safer, because it doesn't have the, it has, it's a trade off as well.

There's no search intent, nobody's actively searching for you. But if you deploy retargeting, it does help you because those people were actively searching, visiting your site. And then they, you do have an idea that they are somewhat interested in something that you were offering at some point.

So yeah, with budgets, I would say, for a campaign to run well, depends, again, depends on how much competition is spending. In currently in travel industry, it depends on the season as well. So like, in your January, things will be cheaper, because there's so much demand.

But in your August, things like that in terms of demand, online demand, yeah, you're gonna pay a pretty penny for stuff. So if you want to start with advertising, it's probably the best month, like January for this specific industry, because demand is there January, February, March, you don't want to start your business and online advertising in like August. So, or I would say as well.

So really, it is a little bit of, I wouldn't say like don't, but your expectations should be different. That's all.

[Richard Bexon]

Well, I mean, you know, again, you know, what services do you offer? And what types of clients, you know, are you looking for? I always like to ask that, because again, one of the ideas of the podcast here is to kind of, you know, show individuals that are doing, I think, doing an amazing job in Costa Rica, that, you know, are starting up their own businesses, or do have great businesses, and that people should be aware of.

[Jelena Radic]

Sure. Well, once you're ready to improve your direct, I can definitely help with even website setup. I can do SEO, that's what I love to do.

I can do PPC, or paid marketing, or paid social, it is like a whole package, because they all complement each other. So I really have experience with all of those, and even have an idea of everything you can do with email marketing as well. Not my favorite channel, but I do have experience.

And if that's a strategy that works for you, like I will tell you like this, like, really depends on the on the business and what they're doing, to give them an idea of what they can do. With the OTAs, I think that's where people start nowadays, like they are either on Airbnb, it's way, like they set that interface. But once you do that, and then you're ready to take on some direct, that's where you want to start then investing.

[Richard Bexon]

So I always think people should have direct business as well as the OTAs for anything in hospitality, just because like a stool with multiple legs, otherwise, you'll be hearing Expedia or booking who constantly basically are changing their terms and the way that they pay, etc. So you want to be in a little bit control of your own destiny.

[Jelena Radic]

True. And like, even like you have like a random dispute one time thing or something like it like they shut you down in some capacity, like what it like your like whole business and, you know, talks, you don't want to do that. I remember when we like had the Facebook had this feature, some kind of reviews or something.

And we like built this thing for like more than 1000, whatever. And then like, Facebook just decided to discontinue that tab. And you're like, so all your trust is like gone with one.

So you really always want to diversify and have as many as you can handle, obviously, channels to draw your business.

[Richard Bexon]

Many of the people listening here are looking to invest in a vacation rental hotel or something down here in Costa Rica. I mean, what pieces of advice would you give them? You know, when it comes to marketing a property?

I mean, I think you've covered a lot of it. But if you were to generalize I mean, what advice would you give them?

[Jelena Radic]

Yeah, know who your ideal guest is. That's first. It can be very niche, or it can be very broad, but do something that you're comfortable with.

Whatever made you come to Costa Rica is whatever is making other people come to Costa Rica. So if a big country will like follow your gut in that sense, like whatever you think is going to work, it's going to work for some people and they just focus on that, craft your message around that. And be consistent in it.

And then once you're ready to take on direct, then there is a learning curve. If you want to do it by yourself, a lot of stuff needs to be covered. But it like you can also then whenever you're ready, hire someone to take that on and do it for you.

So yeah.

[Richard Bexon]

I mean, the last question, because I've kept you long enough. And again, a lot of nuggets of gold in there, Jelena, as always. But if you inherited $500,000 and had to invest in no business or real estate in Costa Rica, what would you invest it in and why?

[Jelena Radic]

Sure. So I would definitely go with real estate because I mean, I just think it's easier, probably. And then I would definitely do at least two places.

And one would be probably like a popular beach town. And another one would be San Jose. San Jose is often overlooked, I think, by people that are drawn to Costa Rica from outside.

But it is actually a great place to own real estate, because it is the place where most of Costa Ricans live. So you will always have a market there. And that market is not going to go down, I would say.

[Richard Bexon]

Where would the other place be? I mean, if you had San Jose, which other locations would you be looking at for the other one?

[Jelena Radic]

Oh, I actually like this place. So I'm right now in Antigua. And it's close by.