As the hospitality cycle lengthens, hoteliers need to come up with new ideas and approaches to attract business.
There is no denying that our economy moves in grand and sometimes mysterious ways, as all businesses are subject to macroeconomic factors.
This is especially true for the hospitality industry, where we are affected by corporate strategies and policies for business travel, convention activity, major employer moves or downsizing, and discretionary travel on the part of consumers. Employment rates and wage growth, interest rates, credit card debt and global interest for international travel to our nation are among the factors that impact hospitality. Moreover, few business areas are truly recession-resistant.
Yet the hospitality sector continues strong. While there have been some recent blips on the revenue-per-available-room chart and market-specific pressures on labor availability and costs, overall, 2019 projects to continue profitable with modest, rate-driven gains in RevPAR.
Certainly, most hospitality organizations are carefully watching budgets and staffing, prepared to make quick property level adjustments should individual markets slow down. Sound implementations of technology and enlightened management of people should also play an important role in keeping staff productive and motivated. We can do more with less when we must.
Regardless, we must not be overly defensive in our strategic posture or we are likely to leave revenue on the table. In all economies, some perform better than others. We need to stay on the offensive when going after new revenue and creative opportunities. If times get tougher, become inventive.
Mine e-commerce platforms
Rather than sit passively and wait for guests to come to us through online travel agencies or brand and property web portals, one useful approach in the current market environment is to “get closer” to potential event-specific and market-specific demand drivers.
Think of those college-age, high school or even younger athletes playing in regional sports tournaments, smaller conventions and trade shows, school graduations or high school and large family reunions. In gaining these incremental guests, we can be proactive by spending additional dollars on exercising the e-commerce platform. In this endeavor, outsourced web experts can help us identify these groups and activities and help us interact with applicable social media, enthusiast web sites, sports complexes and sign-up portals. The goal: to get these consumers on our radar and vice versa.
Armed with this market intelligence, we can develop cross-marketing strategies like making sure that reservation portals for special events include the ability to make lodging reservations. This is also a great way to forge new alliances with local chambers of commerce, travel agents and other hotels in our area. Let’s set our sales teams loose to come up with new ideas and approaches.
The reality is that more and more consumers are making buying decisions of all types on social media and e-commerce platforms with an unprecedented level of interaction, some would call it frenzy, one buyer with another. Ask a question on an Amazon listing and it is amazing how many responses one can get from one’s fellow Amazon users. A similar phenomenon takes place on the many hotel and travel review sites, where expression gets free reign. Talk about eye openers at times. Don’t hold back. Tell us what you really think of us.
Thus, this is the time to ask if we are truly exploring all the different avenues where consumers are making their buying decisions and how best we can reach these guests as a means to build robust revenue management. However the next couple of years play out, the ability to “stay hungry” and stay ambitious will be what determines success.
Kerry Ranson, a 21-year veteran of the hospitality industry, is chief development officer at HP Hotels.
The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Columnists published on this site are given the freedom to express views that might be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to comment or contact an editor with any questions or concerns.