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Lessons from the Field
A Common Sense Approach to Success in the Hospitality Industry
By Dr. John Hogan, CHA MHS CHE, April 30, 2008

Understanding the Differences
Between Marketing and Sales


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"I don't know the key to success, but the key to failure is to try please everyone."
Bill Cosby  {American Comedian}

Many people use the terminology "marketing" and "sales" as having the same meaning. Is there a difference between Marketing and Sales? The answer is a resounding "YES!"   Both are critical to matching your hotel's features and services to the guest who wants and needs them, but the two words do not have the same meaning.

Marketing includes identifying and determining customers' wants and needs, and then providing them at a profit.  One of your property's marketing functions may be your sales staff and sales efforts, but there are many other marketing activities as well.

Marketing incorporates: 

  • Research – Determining who and understanding the needs of the characteristics of guests who come into your marketplace (business, leisure, meeting, contract, etc.) How will the marketplace trends affect your profitability in serving those guests?  How do you keep track of your competition? What are their marketing efforts and how do you exceed them?
  • Promotions – Planning programs and special events that your hotel sponsors or participates in that bring attention to the guests you identified in research as probably being drawn to your type of hotel and its' service levels.  The goal for promotions is to increase traffic and revenues, or sometimes to trial run a new service
  • Advertising – Communicating and delivering your paid message in ways you believe will be effective, including radio, print, cable, TV, internet, etc.
  • Public relations –Being involved in activities aimed at spreading the word and improving relations in your local community in a fashion that highlights the goodwill features of your hotel
  • Pricing – Actively and regularly keeping your offerings at a competitive and profitable level, including using yield management strategies, special programs and partnering with other companies that may or may not be in the hospitality sector
  • Publicity – highlighting the best side of your hotel, sometimes even in stressful situations such as an emergency, a fire or negative event that may occur at your hotel
  • And a new one the last ten years is addressing online accessibility and market positioning.  This means monitoring the blogs, the traveler feedback sites, the 3rd party resources and keeping your site current at every possible opportunity.
Sales is part of the marketing efforts, but specifically includes:
  • Personal efforts to sell the property’s services
  • Direct telephone solicitation in qualifying prospects 
  • Tele-marketing efforts to match prospects' needs with the hotels features, resulting in confirmed business. 
Creating and implementing the marketing plan – this is one of the most critical portions of marketing, as this planning cycle often means success or failure.

During the marketing planning process, the decision on how to position the property in the marketplace is key to the sales effort. By this, we mean how prospects might view your hotel. 

  • Do they see you as the first choice meeting site or as property that houses guests who are having their meetings at the convention center? 
  • Are you a complete service resort or an inexpensive option on the way to the destination? 
  • Are you a first or last choice airport option for airline crews or distressed passengers?
These questions are asked by potential guests, whether the property's management and sales team considers them or not.  The truly successful hotels and companies evaluate their services as compared to the marketplace and then use all the marketing tools they can to communicate that positioning to the marketplace.

Included in the positioning analysis for both the Marketing and Sales efforts usually include understanding the "big" picture, which means detailed research of clients likely to use your hotel.  If your hotel belongs to a membership, referral or franchise organization, substantial overview research probably has already been completed and is available to you for the asking.

1. Long-term goals may reflect planned expansions, renovations or upgrading of services.  Reaching your positioning target profitably is critical.
2. Short-term goals are usually the current year or less and reflect your hotel's performance as compared to the local marketplace.  It is essential to participate in the national reporting services, such as Smith Travel Research, because that is the only effective way to accurately see how you are actually competing with your competitors.
3. Ongoing evaluation of proper positioning the property usually follows analysis of the short-term performance as compared to the rest of your marketplace.  If you are way ahead of everyone else in your direct market competitive set, you may have the option to upgrade your customer target and reach higher revenues.  If you are substantially under performing, then it is clearly time to evaluate your direct sales efforts to correct the shortfall.
Quotas are frequently tied to monthly revenue goals and the most profitable mix of business should yield bonuses or commissions to sales staff who can demonstrate they can bring in new business, while retaining existing clients. 

At many smaller properties (under 100 rooms), the owner or general manager may pursue the marketing end of things.  Depending on the circumstances, they should initiate sales as well.
 
For the medium sized property (100-250 rooms), most will have a sales department. This could consist of a Director of Sales (DOS), Catering Manager, and one or more Sales Managers. The DOS may be involved with marketing, meaning that this position will assist owners, managers and/or a management company in devising a marketing plan and agenda. 

Sales managers should have limited involvement in marketing, instead, concentrating their efforts to personal and direct sales. This means that their time will be spent conducting outside sales calls and attending community events. Sales managers will frequently conduct telemarketing or tele-sales to set up "warm calls" prior to conducting outside sales calls. 

Often there is not an adequate separation of Sales and Marketing at both smaller and medium sized properties. A sales manager cannot effectively sell the property if their time is being utilized to develop marketing plans and research.

Smaller and medium size properties sometimes share a sales person, especially if they are not direct competitors.  A growing trend is for an owner that has multiple smaller properties to have common representation – the critical measure of success there is the need for a well developed plan with accountability from the beginning.
 
The large property (250 rooms or more) has a similar set to the medium sized property.  Here, there will may be a larger number of sales managers and possibly even a Director of Marketing.  It is even more critical then that the Sales Managers do not get bogged down in marketing activities, but instead concentrate their effort at what they were hired to do ….SALES!  If your property has a Sales Manager that spends the majority of the time in the office, then that activity needs to be re-evaluated and re-assigned because a critical part of the marketing or sales machinery is not being used properly.

There are times that the sales person's input is needed when creating Sales and Marketing Plans, packages, etc.  Brainstorming between the two segments of the department is an important aspect at that time. Once the ideas have been gathered, it is the marketing department/owner/managers job then to set the goals and objectives. It is the sales departments job to assist with finding ways to accomplish those goals and objectives, and to make it all happen.



Feel free to share an idea or to contact me regarding consulting and speaking engagements at johnjhogan@yahoo.com anytime and remember – we all need a regular dose of common sense. 

The opinions expressed in this article are those of the author and do not necessarily reflect the views of this publication 

All rights reserved by John Hogan.   This column may be included in an upcoming book on hotel management.

John Hogan’s professional experience includes over 35 years in hotel operations, food & beverage, sales & marketing, training, management development and asset management on both a single and multi-property basis.  He holds a number of industry certifications and is a past recipient of the American Hotel & Lodging Association’s Pearson Award for Excellence in Lodging Journalism, as well as operational and marketing awards from international brands.  He has served as President of both city and state hotel associations.

John’s background includes teaching college level courses as an adjunct professor at three different colleges and universities over a 20 year period, while managing with Sheraton, Hilton, Omni and independent hotels.  He was the principal in an independent training & consulting group for more than 12 years serving associations, management groups, convention & visitors’ bureaus, academic institutions and as an expert witness.  He joined Best Western International in spring of 2000, where over the next 8 years he created and developed a blended learning system as the Director of Education & Cultural Diversity for the world’s largest hotel chain. 

He has served on several industry boards that deal with education and/or cultural diversity and as brand liaison to the NAACP and the Asian American Hotel Owners’ Association with his ongoing involvement in the Certified Hotel Owner program.  He has conducted an estimated 3,100 workshops and seminars in his career.  He served as senior vice president for a client in a specialty hotel brand for six years.

He has published more than 350 articles & columns on the hotel industry and is co-author (with Howard Feiertag, CHA CMP) of LESSONS FROM THE FIELD – a COMMON SENSE APPROACH TO EFFECTIVE HOTEL SALES, which is available from a range of industry sources and AMAZON.com.  He resides in Phoenix, Arizona and is finalizing his 2nd book based on his dissertation –     The Top 100 People of All Time Who Most Dramatically Affected the Hotel Industry.

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Contact:

Dr. John Hogan, CHA MHS CHE
johnjhogan@yahoo.com

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Also See: Identifying Your Customers / Lessons from the Field A Common Sense Approach to Success in the Hospitality Industry / Dr. John Hogan / April 2008
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