The past global financial crisis had a strong impact on most families, forcing them to reexamine their household budgets and eliminate some unnecessary expenses. Chief among those expenses were recreation and travel. With fewer people traveling, hotel sales were down, more rooms were left vacant, and many hotels had to cut back on expenses and lay off staff.
With the travel and tourism industry now rebounding, hotel properties are looking for an edge to draw in visitors. While coming out of this challenging economic environment, one of the biggest mistakes hoteliers could make is lowering rates in hopes of selling more rooms. While rate reductions may lead to more bookings, they have the potential of devaluing a brand. Additionally, selling more rooms at a discount will rarely make up for the drop in demand. In any competitive industry, you should aim to lead on value and not fall back on slashing rates. There are several ways in which you can build value for your brand and draw more guests to your properties.
Analyze your business and the local market
One major factor to consider is your geographic location. Take the time to analyze your market, your location and your visitors. Once you have that data, you can strategize accordingly.
A great tool to use is a market segmentation report. A market segmentation or market share report can teach everything you need to know about your consumer, including important geographic, demographic, psychographic, and behavioral information. Within the report, you can use your competitors pricing as benchmarks and then adjust your room rates accordingly to demonstrate value. Keep in mind we don’t want to compete on price. A market segmentation report will allow you unrestrictive analytics on your local market without having to rely on guesswork. Part of the process is understanding what is happening and adjusting your plan to optimize the situation.
Get up to date with your competitors, peers, and industry
Chances are, you aren’t the only hotel in your area and other hoteliers are out there running a similar business model. Learn what works for everyone else, what doesn’t work and study the broader industry trends. You can learn all of this information by subscribing to industry publications, newsletters, and listening to your peers.
By getting a better grasp of your industry, you can start to understand much more about what your peers are doing and what tactics you should consider employing. Keeping up-to-date is relatively easy and just requires a few minutes each day. Some people argue that trade magazines are some of the greatest industry resource available. Be sure to check them out!
Take advantage of your website and online presence
With more than 70% of visitors booking online, your website will play a huge role in the success of your business. Your site is usually the first line of contact between you and your clients. A well designed and responsive site will engage visitors and increase the likelihood of them completing a transaction.
With an abundance of mobile web users, websites are experiencing a sharp increase in mobile viewership. Creating a mobile friendly user experience will allow visitors to easily interact with and complete a purchase, no matter what device they are using. In fact, some industry experts estimate that 50% of all bookings will be done through a mobile device by 2017.
Additionally, you should identify how your visitors find you online and work to improve your brand’s awareness such platforms. This is done by building a relationship with users through social media, responding to reviews posted to online review sites, and building an effective digital media strategy to improve your SEO rankings.
Understand how and when your revenue comes in
Understanding how and where your revenue stream comes in allows you to plan for future spending and more easily project future income. With a solid revenue management system you can better understand the cyclical demand for rooms and set your rates accordingly.
A revenue management system can help you prepare for changes in consumer behavior and increases in occupancy supply while also providing data on how to appropriately price your rooms in accordance with a changing market. Revenue management systems were once price restrictive for smaller properties, but in today’s turbulent market it is a necessity for all hotels. While this process does take some getting used to, once you develop a solid understanding, your investment will provide future returns.
For more information about responsive web development or establishing an online presence, contact us for a consultation