Most hospitality businesses run digital campaigns without knowing whether their numbers are actually good. A $35 cost per lead for a function venue enquiry — is that worth celebrating or cause for concern? A 3x return on ad spend for a hotel — should you scale the budget or overhaul the strategy?
After 18 years and more than 3,000 hospitality campaigns across Australia, we’ve built performance benchmarks that answer these questions with specifics, not generalities. This article shares those benchmarks alongside sourced industry data so you can assess your own campaigns against real numbers.
Whether you’re running Meta Ads for a restaurant, Google Ads for a hotel, or lead generation for function spaces, you’ll find the exact thresholds that separate strong performance from campaigns that need work.
TL;DR: Based on 3,000+ Australian hospitality campaigns, strong benchmarks are: function venues under $30 per lead, restaurants under $10 per booking, and hotels at 5x+ ROAS. The travel industry averages an 8.73% Google Ads CTR — the highest of any sector (WordStream, 2025). Full benchmark tables and industry data below.
Why Do Hospitality Marketing Benchmarks Matter?
The travel industry achieves an average 8.73% click-through rate on Google Ads — the highest of any industry — with a 5.75% conversion rate and $2.12 average CPC (WordStream, Apr 2024–Mar 2025). But these broad numbers don’t tell a restaurant owner whether their specific campaign is performing. That’s where vertical-specific benchmarks come in.
Generic “travel industry” averages lump together airlines, tour operators, OTAs, and hotels into a single bucket. A boutique restaurant in Fortitude Valley has nothing in common with an international airline’s performance metrics. You need benchmarks that match your specific campaign type.
We’ve segmented our benchmark data into four campaign categories that reflect how hospitality businesses actually operate: function venue enquiries, dining bookings, accommodation revenue, and live entertainment. Each has different conversion goals, different funnel mechanics, and different definitions of “good.”
Without these benchmarks, most operators rely on gut feel. They’ll keep spending $50 per function enquiry because “leads are coming in” — not realising they’re paying 67% more than they should be. Or they’ll panic about a $1.80 cost per Book Now click when that’s comfortably within the acceptable range.
Learn more about our hospitality marketing services.
What Are the Benchmarks for Function Venue Marketing?
The global events industry reached $1.48 trillion in 2025, with in-person event attendance projected to grow 69% by 2026 (Bizzabo, 2026; Business Research Company, 2025). Function venue campaigns should be measured by cost per lead — the cost of generating each enquiry for weddings, corporate events, conferences, or private functions.
Based on our analysis of function venue campaigns across Australian hotels, standalone venues, and restaurant private dining spaces, here are the performance thresholds:
| Performance Level | Cost per Lead | What It Means |
|---|---|---|
| Strong | Under $30 | Excellent. Document the creative, targeting, and offer for replication. Scale budget if lead quality holds. |
| Average | $30 – $40 | Acceptable but needs attention. Test new ad creative, check for fatigue, and audit landing page conversion rate. |
| Underperforming | Over $40 | Full funnel review required. Audit CTR → CPC → landing page views → form submissions. Check targeting, creative hooks, and form friction. |
Source: Merge Marketing function venue campaign benchmarks, 3,000+ hospitality campaigns (2008–2026)
If your function venue leads cost over $40, start at the top of the funnel. Is the ad creative showing the space in its best light? Are you targeting event planners and couples within the right radius? Is the enquiry form asking too many questions upfront?
Speed matters here more than in other hospitality verticals. 42.6% of event planners say getting venue proposals in a timely manner is their biggest sourcing challenge (Cvent, 2026). When selecting a venue, planners prioritise size and capacity (50%), services and facilities (44%), and cost (42%). Your ads and landing pages need to communicate all three within seconds.
According to Merge Marketing’s benchmarks from 3,000+ Australian hospitality campaigns, a well-optimised function venue campaign generates leads at under $30 per enquiry. Campaigns producing leads between $30–$40 need creative and targeting adjustments, while anything above $40 per lead requires a full-funnel audit from ad creative through to landing page and form design.
Explore our function venue and event marketing strategies.
Read more: How Much Should a Function Venue Lead Cost? | For weddings specifically: How Much Should a Wedding Venue Lead Cost?
How Much Should a Restaurant Booking Cost Through Digital Ads?
74% of diners now use social media to decide where to eat, and 57% book directly through social platforms (Marketing LTB, 2025). With that volume of intent flowing through digital channels, the cost per booking is the most meaningful metric for dining campaigns — not impressions, not reach, not even clicks.
We measure restaurant campaign performance using two approaches depending on whether the venue has booking engine tracking capability:
Option 1: Cost per Booking (When Tracking Is Available)
If you’re using SevenRooms, NowBookit, ResDiary, or OpenTable (tracking available as of February 2026), you can measure cost per completed booking directly. Here are the benchmarks:
| Performance Level | Cost per Booking | What It Means |
|---|---|---|
| Strong | Under $10 | Outstanding efficiency. Verify booking quality through reservation tracking and document the funnel for replication. |
| Average | $10 – $20 | Acceptable. Review landing page conversion, simplify the reservation process, and verify tracking accuracy. |
| Underperforming | Over $20 | Full funnel analysis. Audit click-to-conversion rate, check booking form complexity, mobile experience, and tracking setup. |
Source: Merge Marketing dining campaign benchmarks, 3,000+ hospitality campaigns (2008–2026)
Option 2: Link CTR (When Booking Tracking Isn’t Available)
Not every restaurant has pixel access on their booking widget. When you can’t track completed bookings, Link Click-Through Rate serves as a proxy metric:
| Performance Level | Link CTR | What It Means |
|---|---|---|
| Strong | 1.6%+ | Outstanding engagement. Document the lifestyle content approach and creative strategies for replication. |
| Average | 0.9% – 1.2% | Below baseline. Test new lifestyle content, refresh atmosphere creative, and check for creative fatigue. |
| Underperforming | Under 0.9% | Comprehensive review needed. Analyse what changed, test proven lifestyle positioning, and assess audience quality. |
Source: Merge Marketing dining campaign benchmarks, 3,000+ hospitality campaigns (2008–2026)
A pattern we’ve noticed across hundreds of restaurant campaigns: lifestyle-positioned content consistently outperforms promotional messaging. Ads showing atmosphere, the dining experience, and real moments generate higher CTRs than “$25 steak night” discount ads. The restaurants pulling 1.6%+ Link CTRs are almost always leading with ambience, not price.
According to Merge Marketing’s benchmarks from over 3,000 Australian hospitality campaigns, a restaurant booking acquired through digital advertising should cost under $10 for strong performance. Campaigns between $10–$20 per booking need optimisation, and anything above $20 signals friction in the reservation funnel — typically form complexity, poor mobile experience, or tracking gaps.
The social proof angle matters too. User-generated content drives 4x higher conversion rates than branded photography (Marketing LTB, 2025). If your restaurant campaigns rely entirely on professional shoots, test incorporating customer photos and reviews into the creative mix. And with 61% of diners saying TikTok food content directly influences where they eat, short-form video isn’t optional for restaurants anymore.
For restaurants running Facebook and Instagram specifically, industry benchmarks show an average CPC of $0.85, CPM of $8.75, and cost per lead of $3.16 (Mesha / CUFinder, 2025). Those CPL numbers look attractive compared to our $10 per booking benchmark — but leads aren’t bookings. The gap between a click and a completed reservation is where most restaurant campaigns leak value, which is why we measure completed bookings rather than form fills.
See how we help restaurants fill tables.
See our detailed breakdown: How Much Should a Restaurant Booking Cost Through Ads?
Explore further: How Does Social Media Influence Restaurant Bookings? | How to Track Restaurant Bookings Through Digital Ads
New: How to Get Your Restaurant Recommended by ChatGPT and Google AI | How to Optimise Your Google Business Profile for AI Search
What ROAS Should Hotels Expect From Digital Advertising?
Hotels that shift bookings from OTAs to direct channels retain 94.87% of guest-paid revenue compared to just 82.06% through online travel agencies — a difference driven by OTA commission rates of 15–25% per booking (Punch Hospitality, Revinate). That makes digital marketing ROI for direct bookings doubly important: you’re not just measuring ad performance, you’re measuring the margin difference against OTA dependency.
For accommodation campaigns, ROAS (revenue divided by ad spend) is the primary metric. We use a three-tier measurement system depending on what tracking access you have:
Primary Metric: Return on Ad Spend (ROAS)
| Performance Level | ROAS | What It Means |
|---|---|---|
| Strong | 5x+ | Exceptional. Scale budget if inventory allows. Every $1 in ads generates $5+ in booking revenue. |
| Average | 2x – 3x | Below target. Review audience targeting, creative performance, and the booking funnel. Test new approaches. |
| Underperforming | Under 2x | Critical. Full audit of conversion tracking, landing pages, creative, and audience quality required. |
Source: Merge Marketing accommodation campaign benchmarks, 3,000+ hospitality campaigns (2008–2026)
How does this compare to industry averages? Broadly, hotel Google Ads ROAS ranges from 3–5x for budget properties, 4–6x for mid-tier, and 6–10x for luxury hotels. The median hotel ROAS on Google Ads reaches 15.19x, while Meta Ads delivers a median of 4.83x for accommodation advertisers (Varos, April 2025). Those medians reflect well-optimised accounts — our 5x+ threshold as “strong” is deliberately set as a floor that works across all property tiers and budget levels, not just top performers.
Secondary Metric: Cost per Book Now Click
When direct ROAS tracking isn’t available — common with large hotel chains using third-party booking engines like Accor — we fall back to cost per “Book Now” button click:
| Performance Level | Cost per Book Now Click | What It Means |
|---|---|---|
| Strong | Under $1.50 | Excellent click efficiency. Monitor downstream conversion rate to ensure quality. |
| Average | $1.50 – $2.50 | Acceptable. Watch for upward trends and test creative variations. |
| Underperforming | Over $2.50 | Review creative relevance, audience targeting, and call-to-action effectiveness. |
Source: Merge Marketing accommodation campaign benchmarks, 3,000+ hospitality campaigns (2008–2026)
Third Metric: Link CTR
For properties where neither ROAS nor Book Now tracking is available (e.g. Rydges properties without analytics access), Link CTR is the fallback. Target 1.0%+, with 1.5%+ indicating strong engagement.
Return on ad spend (ROAS) is the primary performance metric for hotel digital advertising. Based on Merge Marketing’s benchmarks across Australian hotel clients, top-performing accommodation campaigns achieve 5x ROAS or higher — meaning every $1 spent on advertising generates $5 or more in direct booking revenue. Industry-wide, hotel ROAS ranges from 3–5x for budget properties to 6–10x for luxury hotels (Varos).
The direct booking cost advantage is substantial. Direct booking acquisition through SEO and paid search costs 5–12% of booking revenue, while OTAs charge 15–25% in commission (HotelsSEO, 2025–2026). Direct bookers are also 2.1–3.4x more likely to return than OTA guests, making the lifetime value significantly higher. That’s why even a 2x ROAS on direct campaigns can be more profitable than “free” OTA bookings once you account for commission savings.
Explore our hotel marketing services.
Dive deeper: What ROAS Should a Hotel Expect from Google Ads? | Complete comparison: How Much Does a Direct Hotel Booking Cost vs an OTA?
Related: Why Do 85% of Hotel Website Visitors Abandon Before Booking? | Is Email Marketing Worth It for Hotels?
How Does the Travel Industry Compare to Other Sectors on Google Ads?
Google Ads benchmarks from WordStream (April 2024–March 2025) show the travel industry outperforming nearly every other vertical on click-through rate at 8.73%, though conversion rates and CPCs vary significantly by campaign type (WordStream, 2025). Here’s how hospitality stacks up against other industries:
That 8.73% CTR is almost double the all-industry average. Hospitality ads get clicked because people actively want to book experiences — accommodation, dining, events. The demand is there. Where campaigns fail isn’t in generating clicks, it’s in converting those clicks into bookings.
The average cost per lead across the travel industry is $73.70 (WordStream, 2025). But this is inflated by high-value travel purchases. Specialist hospitality campaigns — especially for dining and local events — typically beat this figure significantly. Our function venue benchmark of under $30 per lead is less than half the generic travel CPL.
The median ROAS across all industries on Meta Ads is 2.79x (Triple Whale, 2025). So when we set 5x+ as our “strong” threshold for accommodation, we’re targeting performance nearly double the cross-industry median. That’s the advantage of vertical specialisation — generic agencies accept 2.79x; hospitality specialists push for 5x+.
Full analysis: What’s a Good Click-Through Rate for Hospitality Ads?
What Digital Marketing Budget Should Hospitality Businesses Allocate?
The average marketing budget across all industries sits at 7.7–9.4% of total revenue according to the Gartner CMO 2025 Spend Survey. But most Australian hotels spend under 2.5% of room revenue on marketing, including staff costs (Hospitality Net / Punch Hospitality). That gap represents both a problem and an opportunity.
Hotels under-investing in marketing are effectively paying more through OTA commissions. If 15–25% of every OTA booking goes to commission, but only 5–12% goes to direct acquisition costs, the maths is clear. Spending more on digital marketing to shift even 10% of bookings from OTA to direct typically saves 8–15% of total commission spend (HotelsSEO, 2025–2026).
Our finding: Hotels that invest 4–6% of room revenue in digital marketing (roughly double the industry average) consistently hit our 5x+ ROAS benchmark. The hotels stuck at 2x ROAS are almost always under-investing — they don’t have enough budget for proper testing, retargeting, or multi-channel campaigns.
For restaurants and venues, the budget equation is different. There’s no OTA equivalent taking 20% commission, so the ROI calculation is more straightforward: how much does each booking cost, and what’s the average spend per cover? A $10 cost per booking for a restaurant where the average party spends $180 is a no-brainer return.
Email marketing deserves specific mention here. It returns $36 for every $1 spent in hospitality (Siteminder), making it one of the highest-ROI channels available. Yet most hospitality businesses treat it as an afterthought. Loyal customers already spend 22.4% more per stay (Siteminder) — email is how you keep them coming back.
Request packages and pricing for your venue.
See also: How Much Should a Hotel Spend on Marketing?
Related: How to Get Your Hotel Found in AI Search Results | What Schema Markup Should Hotels and Restaurants Use for AI?
How Should You Track Conversions Across Different Booking Platforms?
Approximately 85% of users abandon hotel booking engines before completing a reservation, and only 2.4 out of 100 website visitors finalise bookings (Revinate). With conversion rates that low, accurate tracking is non-negotiable — you need to know exactly where people drop off and what’s working.
We’ve learned through hundreds of setups that the tracking platform determines your measurement options. Here’s what’s possible with each major booking system in Australia as of 2026:
Full pixel tracking available: SevenRooms, NowBookit, ResDiary, and OpenTable (tracking capability added February 2026). These platforms allow you to place Meta and Google conversion pixels directly on the booking confirmation page, giving you cost-per-booking data.
Limited tracking: Accor-managed properties and some hotel chains restrict analytics access. For these, “Book Now” button clicks become your primary conversion metric — hence our $1.50 CPC benchmark.
No tracking access: Some Rydges properties and venues using proprietary booking systems don’t offer any analytics integration. Link CTR is your only measurable signal, which is why we’ve set specific CTR benchmarks for this scenario.
The practical implication? If you’re choosing between booking platforms, factor in tracking capability alongside commission rates and features. A platform that costs slightly more per booking but gives you full conversion data will save you money in the long run through better optimised campaigns.
Learn about our Google Ads management services.
Deep dive: How to Track Restaurant Bookings Through Digital Ads
The Direct Booking Advantage: Why OTA Dependency Costs More Than You Think
Direct bookers are 2.1–3.4x more likely to return than guests who booked through an OTA (HotelsSEO CRM analysis, 2025–2026). That repeat rate fundamentally changes the unit economics of customer acquisition. A $50 cost to acquire a direct guest who returns three times is far cheaper than a “free” OTA guest who never comes back.
The trend is clear: OTAs now generate only 22% of hotel bookings, down from roughly 30% just a few years ago (Hotel News Resource). Hotels are reclaiming direct channels. The properties investing in their own digital marketing, loyalty programmes, and booking engine optimisation are the ones driving this shift — and keeping 13–20 percentage points more revenue per booking as a result.
Here’s the maths that most hotel operators miss. A hotel paying 20% OTA commission on a $200/night booking loses $40 per night. That same booking acquired through Google Ads at a 5x ROAS costs $40 in ad spend — seemingly the same. But the direct guest enters your CRM, receives your email marketing ($36 return per $1 spent, per Siteminder), and is 2-3x more likely to book again. Over three stays, the direct guest cost $40 total. The OTA guest cost $120 in commission.
Cart recovery emails also play a role. With 85% booking engine abandonment, cart recovery emails that generate 15–30% conversion rates represent significant recaptured revenue (Revinate). You can’t send recovery emails to OTA abandoners — another advantage of the direct channel.
Hotels that book directly retain 94.87% of guest-paid revenue, compared to just 82.06% through OTAs, according to Punch Hospitality and Revinate. With OTA commissions running 15–25% and direct acquisition costing 5–12% through SEO and paid search (HotelsSEO, 2026), the margin advantage of direct bookings is 8–15 percentage points per reservation.
What About Live Music and Entertainment Campaigns?
40% of people visit a venue after seeing event content online, and social media is now considered the most successful marketing strategy for food and entertainment venues ahead of SEO and online directories (Marketing LTB, 2025). Live music and entertainment campaigns sit in a unique position — they’re time-sensitive, emotion-driven, and heavily visual.
For live music campaigns, we use Link CTR as the primary metric because most ticketing platforms (Eventbrite, Moshtix, Oztix) have limited pixel integration:
| Performance Level | Link CTR | What It Means |
|---|---|---|
| Strong | 1.5%+ | High engagement. Document the creative approach and artist/event imagery that’s working. |
| Average | 0.7% – 1.0% | Below target. Refresh creative — test different event imagery, artist content, and messaging angles. |
| Underperforming | Under 0.7% | Creative overhaul needed. Test entirely different imagery, messaging, and audience segments. |
Source: Merge Marketing live music campaign benchmarks, 3,000+ hospitality campaigns (2008–2026)
Live music ads that feature the artist or act consistently outperform generic “live music every Friday” messaging. If you’re promoting a specific act, lead with their face or a performance shot. If it’s a recurring weekly event, lead with the atmosphere — the crowd, the lighting, the energy. Don’t lead with a logo or a lineup poster.
The 1.0% Link CTR target for live music might seem lower than dining (1.6%), and it is. Entertainment audiences are broader and more casual in their browsing. Someone might scroll past a live music ad four times before eventually clicking when the right Friday comes along. The frequency and creative freshness matter more here than in any other campaign type.
See our event marketing services.
Related: What’s a Good Click-Through Rate for Live Music Venue Ads?
Deep dive: What Is GEO and Why Should Australian Hospitality Businesses Care?
How Is AI Changing Hospitality Marketing in 2026?
86% of travellers have now used AI to find or book accommodation, and 40% of US travellers used generative AI tools for trip planning in 2025 (TakeUp AI; Phocuswright, 2025). This isn’t a future trend — it’s already reshaping how hospitality businesses get discovered and booked. AI Overviews now appear in 13% of all Google searches (Semrush, 2025), and 89% of travellers say they want AI tools integrated into their future travel planning (Booking.com).
The commercial impact is measurable. 84% of travellers say they’re more likely to book a property recommended by an AI assistant, and 78% rate it as very or extremely important that hotels appear in AI-generated recommendations (TakeUp AI). In London, 83% of 4-5 star hotels have already received bookings directly attributed to AI-driven discovery (Snapfix). If your property isn’t showing up in AI answers, you’re losing bookings to competitors who are.
Voice search adds another layer. 46% of travellers have used voice search to find accommodation, and “hotels near me” voice queries have grown 500% in two years (Synup). Your Google Business Profile, structured data, and FAQ content aren’t just for traditional SEO anymore — they’re the raw material that voice assistants and AI systems pull from when answering spoken queries.
AI is already driving measurable hotel bookings — 86% of travellers have used AI to discover or book accommodation, with 84% saying they’re more likely to book properties recommended by AI assistants (TakeUp AI, 2025). In London, 83% of 4-5 star hotels report receiving AI-attributed bookings (Snapfix). Hospitality businesses that structure their content for AI citation and voice search are capturing demand that competitors don’t even see.
What does this mean practically? The days of hiding your pricing, capacity, and key details behind a “contact us” form are ending. AI assistants like ChatGPT, Google’s AI Overviews, and Perplexity are answering queries like “best hotel in Brisbane for corporate events” by pulling information from websites that clearly state their facts. If your venue page says “contact us for pricing” while a competitor lists “$85 per person, minimum 50 guests,” the competitor gets cited.
This doesn’t mean you have to publish every price. But factual content — venue capacity, cuisine type, location details, event types hosted, parking availability — should be explicit and machine-readable. Structured data (schema markup) helps too: hotels should implement Hotel schema, restaurants should use Restaurant schema, and events should use Event schema at minimum.
Are you optimising for AI search, or still pretending it’s 2019? The hospitality businesses that get this right now will own the AI citation space before their competitors even realise it’s a channel.
Discover our SEO services for hospitality.
Full analysis: How Is AI Changing How Guests Find Hotels and Restaurants?
Frequently Asked Questions
What is a good ROAS for hotel digital advertising?
Based on 3,000+ Australian hospitality campaigns, a 5x ROAS or higher indicates strong hotel advertising performance — every $1 in ad spend generates $5+ in booking revenue. Industry benchmarks from Varos show luxury hotels achieving 6–10x, mid-tier 4–6x, and budget properties 3–5x. Below 2x requires an immediate campaign audit.
How much should a restaurant pay per booking through digital ads?
A cost per booking under $10 represents excellent restaurant campaign performance, according to Merge Marketing’s benchmarks. The $10–$20 range is acceptable but warrants optimisation. Above $20 per booking typically signals friction in the reservation process — complex forms, poor mobile experience, or inaccurate conversion tracking need investigation.
What is an acceptable cost per lead for function venue marketing?
Strong function venue campaigns generate leads at under $30 per enquiry. The $30–$40 range needs creative and targeting attention. Above $40 requires full-funnel analysis from CTR through to form submissions. 42.6% of event planners cite slow proposal responses as their biggest sourcing challenge (Cvent, 2026), so speed of follow-up matters as much as lead cost.
Should hotels invest more in direct bookings vs OTA listings?
Hotels retain 94.87% of revenue from direct bookings versus 82.06% from OTAs (Punch Hospitality / Revinate). Direct acquisition costs 5–12% of revenue through digital marketing, while OTA commissions run 15–25% (HotelsSEO, 2026). Direct bookers also return 2.1–3.4x more often, making lifetime value substantially higher.
What Google Ads benchmarks should hospitality businesses target?
The travel industry achieves an 8.73% CTR on Google Ads — the highest of any sector — with a 5.75% conversion rate and $2.12 average CPC (WordStream, 2025). The average cost per lead is $73.70, though specialised hospitality campaigns typically outperform this. Merge’s function venue benchmark of under $30 per lead is less than half the generic travel CPL.
Key Takeaways
- Function venues: Target under $30 per lead. Over $40 means your funnel needs a full audit.
- Restaurants: Under $10 per booking is strong. If you can’t track bookings, aim for 1.6%+ Link CTR.
- Hotels: 5x+ ROAS is the threshold for strong performance. Below 2x is a red flag.
- Direct vs OTA: Direct bookings retain ~95% of revenue vs ~82% through OTAs. The margin difference alone justifies digital marketing investment.
- Budget: Hotels spending 4–6% of room revenue on digital marketing consistently outperform those at the industry average of under 2.5%.
- AI search: 86% of travellers have used AI to find accommodation, and 84% are more likely to book AI-recommended properties. Structure your content to be citable, or lose visibility to competitors who do.
These benchmarks aren’t static. We update them quarterly as campaign data accumulates and platform dynamics shift. If your campaigns aren’t hitting these numbers, that’s not a failure — it’s a starting point. Knowing where you stand is the first step to getting where you need to be.
Want to see how your campaigns measure up? Get in touch for a complimentary performance review against these benchmarks.
Request a free campaign performance review.
Published March 2026. Benchmarks based on Merge Marketing’s analysis of 3,000+ Australian hospitality campaigns (2008–2026). Industry statistics sourced from WordStream, Varos, Revinate, Punch Hospitality, Siteminder, HotelsSEO, Bizzabo, Cvent, Marketing LTB, Triple Whale, Business Research Company, TakeUp AI, Phocuswright, Booking.com, Snapfix, Semrush, Synup, Hotel News Resource, Mesha, and CUFinder. Last updated March 2026.