Carol Verret Consulting 
and Training
Consulting
Training Seminars
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Selling Up!
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Taking Group Room Revenue
to a New Level
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by Carol Verret, February 2006

2006 is the year for hotels to maximize their revenue opportunities. Demand is high and new supply is low – new supply currently in the pipeline will begin entering the market in late ’06 and ’07. It is clearly a ‘sellers’ market this year! Hotel sales departments clearly have an opportunity!

Hotels that may have grown a bit ‘tired’ in the lean years are now investing in capital improvements and extensive renovations as there is finally the cash to do this and it is imperative to remain competitive at the desired higher rate tier. Investors and owners, however, want to see the return on this investment.

In recent conversations with contacts in the industry, there are mixed messages. On one hand, meeting and travel planners are concerned that rates are going through the roof and deals are getting tough to negotiate. On the other hand, Vice Presidents and Directors of Sales, express concern that group room rates are not increasing at the same pace as rates from other channels.

There are no easy answers but answers nevertheless. In both camps, the players need to make some tough adjustments. From the meeting planners perspective there is tremendous pressure to keep travel budgets at least level with last year, (see Hotels Are in the Drivers Seat! Hotel Online, November 2005).

If it is the year that ‘Hotels Are in the Drivers Seat’, why do so many sales people have such a tough time asking for and getting the rate? Often it is a matter of mind set versus purely a skill set issue. There are a few factors that play into this: 

  • Length of Tenure. How long have the sales people been at the property? If they have been through the tough times, they may be stuck in the recession mentality. If they were responsible for selling a ‘tired’ property that has been recently renovated, the reality about what the new product is worth may not have set in. What both need to realize is that it was never ALL ABOUT THE RATE anyway! As a wise man once said, if rate was the only issue, the economy hotel products would be full every night and they aren’t!
  • Who signs the paycheck? Sales people often have a great need to be liked. They have a long-standing relationship with a client that they want to keep happy even as that client is hammering them on the rate. Never walk into a negotiation that you are not prepared to walk away from. Sales people forget that it is the hotel that signs the check and if the client is inflexible, given the changed circumstances of supply and demand, they need to stand their ground and present the value of the product. What can you buy today that you paid the same price for last year? 
  • Breaking Up is Hard to Do! Not every client who used the property in the past when times were leaner or before the renovation is going to make the cut. In order to drive the revenue, it is often necessary to change the client mix. Be willing to let go of accounts that cling stubbornly to their old rate. Refer them to another property that can meet their rate demands.
  • Mining for Higher Rated Business. This is also called prospecting and New Business Development. Most sales people don’t have time to prospect because there is soooo much to do servicing existing accounts (see above!), communicating with the Front Desk, Food and Beverage, attending meetings, etc. It’s a new world out there – those who are able to replace lower rated accounts with new higher rated business will win the ‘Task’! Those who won’t or don’t’ -- how many of you watch the Apprentice?
  • Change the Compensation or Incentive Structure. I really hate to repeat myself but there is evidence that many hotels are listening and modifying their compensation program to reflect productivity. When the economy is good and everyone makes budget by answering the phone, it is very easy to be complacent. It is the industry standard of salary plus bonus tied to property revenues not individual productivity that has kept the hospitality industry from attracting the best and brightest sales people in the past. 
Hotel sales people, and I love them, need to realize that they are in the Drivers Seat and what that means to them. Go ahead – take a risk, ask for a higher rate! Try not to look surprised when you get it! .
 




Carol Verret And Associates Consulting and Training offers training services and consulting in the areas of sales, revenue management and customer service primarily but not exclusively to the hospitality industry. To find out more about the company click on www.carolverret.com. To contact carol send her an email at carol@carolverret.com or she can be reached by cell phone (303) 618-4065.

copyright © Carol Verret, 2002-2003 -2004 -2005


 
Contact:
Carol Verret, Consulting and Training
Carol Verret
5910 S. University #C-18, PMB 374
Greenwood Village, CO 80121
Telephone: (303) 618-4065
carol@carolverret.com
Web Site: http://www.carolverret.com/
Email: carol@carolverret.com
Also See: Revenue Management 2006; The Risks and Rewards / Carol Verret /January 2006 
Revenue Management and Group Sales - The Partnership Not the Disconnect / Carol Verret / November 2005
Habits of Highly Successful Hotel Sales People / Carol Verret / September 2005
Triple Witching Hour - The Marketing Plan, Revenue Management Strategy and RFPs for '06 / Carol Verret / August 2005
"Smile" is a Learned Behavior - Creating a Culture of Customer Service / Carol Verret / July 2005
Revenue Management Systems -- Considerations for Evaluation / Carol Verret / June 2005
Disconnect -- Aligning the Revenue Management and Sales Strategies / Carol Verret / May 2005
Independent Hotels & Resorts; Ride the Wave or Float with the Tide? / Carol Verret / March 2005
Hospitality Sales Training Companies Reach Across the Competitive Playing Field to Combine Live Seminar Expertise with  the Convenience of the Internet / Carol Verret / January 2005
Revenue Management - The Challenge for Hotel Sales / Carol Verret / January 2005
Hotel Sales Departments -- Issues in Processes and Functionality / Carol Verret / November 2004
The GM'S Role in Revenue Management / Carol Verret / October 2004
Transforming the Hotel Sales Organization; Alignment with the New Realities of Sales / Carol Verret / August 2004
The Revenue Management Strategy - The Pre-Plan Marketing Plan / Carol Verret / July 2004
Hotel Revenue Management this Summer - a Game of Skill, Art and Most of All Nerves / Carol Verett / May 2004
What Do Meeting Planners Want? Hotel Sales Managers Want to Know! / Carol Verret / May 2004
Revenue Management -- The Integration of Revenue Drivers / Carol Verret / March 2004
CYBER SALES -- Hotel Sales in an Internet World is the New Reality / Carol Verret / February 2004
The New Realities of Hotel Sales - Focus on Revenue Generation / Carol Verret / January 2004
Hotel Sales -- Innovation in the Face of Limitations / Carol Verret / November 2003
The Good News & the Bad News; Improving Economy = New Hotel Development / Carol Verret / October 2003
Leadership - General Managers Managing the Sales Process / Carol Verret  / October 2003
When the Crystal Ball is Cloudy; Marketing Plans for 2004 / Carol Verret / July 2003
Partnership of Sales and Technology; Using Tech Tools to "Sell" the Hotels / Carol Verret  / July 2003
Back to the Basics? The Basics of Hotel Sales Have Changed! / May 2003
Creating Sales "HUNTERS": The Skill Sets Required in the New Hotel Sales Environment / April 2003
Heightened Security Requires New Strategies in Hotels Sales / Carol Verret Consulting and Training / Mar 2003
Revenue Recovery - Building The ‘A’ Team in Sales / Carol Verret / January 2003
Contingency Marketing Plan – War In Iraq! / Carol Verret / November 2002
Playing the Rate Game - Positioning -- Positioning -- Positioning! / Carol Verret / October 2002
The Rate Game - Playing to Win / Carol Verret / October 2002
The Challenge of Marketing Independent Boutique Hotels / Carol Verett / August 2002
Hotel Sales in a Limited Service Environment - The Rules Have Changed / Carol Verett / August 2002
The General Manager’s Role in Sales -Chief Marketing Officer of the Hotel / Carol Verret / April 2002
100% Market Share Penetration is Not Good Enough / Carol Verett / January 2002
The Key to REVPAR Recovery –  New Business Development / Carol Verett / December  2001
Trash the 2002 Marketing Plan - And Just Start Over / Carol Verett / September 2001
How to Use Consultants Effectively –  A View From the Other Side  / Carol Verret / August 2001
How Soft Is Your Hotel's Economic Landing?  / Carol Verret / Aprl 2001
The ‘Value Proposition’: Marketing Yourself to Prospective Employees / Carol Verret / January 2001
Generation Y:  Motivating and Training a New Generation of Employees / Carol Verret / November  2000
Why Customer Service Seminars Don't Work / Carol Verret / October 2000
Creating a Culture of Customer Service / Carol Verret Consulting and Training / Sept 2000 
FAT, DUMB AND HAPPY – The Seasonal Boom and  Bust Cycle / Carol Verret / August 2000
Surf's Up - Ride the Wave or Miss the Boat -The Effective Use of Technology in Hotel Sales / Carol Verret / July 2000 
Measuring Effectiveness of  Hotel Sales Departments / Carol Verret / June 2000
Hotel Sales Training - The Need for Immediate Results / Carol Verret/ May 2000



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