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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, December 2008

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Principles of Success

Planning in a Challenging Economy -
Fundamentals of Hotel Sales Planning
 Part 1 of 2

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By Dr. John Hogan CHE CHA MHS
December 11, 2008
 
 
“Plans are only good intentions unless they immediately degenerate into hard work.”
Peter Ducker (Austrian-born) management writer (1909 - 2005)
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12 Successful Fundamentals in Sales Planning that can make the difference!

The current global economic news is not generally positive these days in the hospitality and many other industries.  The need for planning is more critical than ever and the quote from Peter Drucker says it all – it takes focused efforts to address the situation and begin to turn the situation around.

This 2 part series is very straight forward and common sense in approach.  The first part addresses revenue building and the second will examine some expense evaluation topics.

Principles of Success in Planning in a Challenging Economy
Would you like to make your sales effort more successful? 

The following are all fundamentals in sales, but are too often overlooked in exchange for what are actually marketing strategies.  Pursue these sales guidelines when soliciting and booking business and servicing accounts:

1. Acquire and use good selling knowledge. Finding out who your customers are, where they are coming from, how they came to select your property, why they stay at your property, how long they stay and how much they spend— among other information —will help focus your sales effort. 

2. Plan A Good Market Mix. It is extremely hard to be all things to all people all the time, which means knowing your proper customer base.  While one does not want to turn away potential, understanding the mix of business reflects how much of what type of business you're doing. Ask yourself: What percentage of my total room sales comes

  • from meetings at your hotel or nearby centers 
  • from youth groups or sports related activities
  • from the transportation center (airport, bus, cruise lines, trains, etc)
  • from seniors and why
  • from the brand reservation center and at what rates and plans
  • from transient business, walk in guests and other categories?
Now, after you review the past 3-6 months to accurately see trends, what decisions do you need to make in your selling activities?   What mix of business would be most profitable?

3. Know Your Competition and specifically your direct competitors. I have heard more than one brand CEO warn at recent meetings that there are “going to be more empty rooms at the hotel across the street from you and they are going to be scouting your customers.”  A thorough knowledge of the other properties near you can help you size up your property and determine the areas in which you can compete the best, whether it is location, price, size, product, service or amenities. The idea, of course, is to sell your positives and to expand your market share.

4. Research and qualify your multiple price policy. There's nothing wrong with selective discounting. Hotels have been doing it for years, with special off-season, corporate, group, senior citizen and military rates, among others. Do you know which special rates are generating business for you? A periodic review of all your rates will help you establish the multiple-rate policy that's right for you.  There are many 3rd party sites that may or may not help your profitability and/or cash flow. If you make the decision to work with a discounter such as Hotels.com, Expedia, Hot-Wire, Orbtiz, Booking Buddy,  PriceLine, Travelocity or the new "hot" service, track your actual demand (rooms used, rooms denied because you were full, rooms declined for reasons of rate, location, etc.) so you can evaluate intelligently the business decision.  Determine what your competition is doing by these organizations as well so you can male

5. Make high-quality Business Contacts And Make Them Work For You. Getting good business contacts is the first step, and making sure they're bringing business into your property the second. Make sure your contacts are frequent users of either the area and/or your property and then ask them to provide you leads. 

6. Try New Things. Remember: most successful entrepreneurs would not be where they are today if they didn't take a chance and try new things. Come up with new ideas to promote business and don't be afraid to put them into action. 

7. Develop new sales techniques to book more rooms and new proposals to land more group business. I recall in my career two hotel teams that were very creative and innovative.  They were organizations affiliated with different brands and cities, but their spirit brought them success. If only half of your new schemes works, you'll be ahead of the game. 

8. Be Attentive To Selling Costs. In any business, spending more than you take in, of course, is dangerous. Cost effectiveness in selling for a hotel is very important. As total sales expenditures start to creep up, you must continue to expect a greater return from your sales effort. Budgeting for sales and monitoring the sales budget against results are essential.

9. Follow Solid Management Procedures. In general, try to do a better job communicating, developing, training, motivating, planning, organizing, directing and controlling. It's not enough these days to hire a salesperson and say: "Get out there and sell." 

10. Recruit High-Quality People. You want and need sales professionals who are sincere, believable, down-to-earth, friendly, committed, well dressed and well mannered; in other words, individuals who will represent your property well.

11. Set Realistic Growth Plans.   Yes, even in down economies, there must be some stretch goals.  These should assess where you are today and honestly project where you expect and want to be next year, the year after, and so on. 

12. Sell Aggressively. Aggressive and assertive are not synonyms. One means hard hitting and the other confident – in challenging economic times, those professionals in sales must have some of both attributes to book the business. One can be aggressive while still being friendly, credible and sincere. Being tenacious, following up and ensuring customer confidence all add up to success.


Part two of this series on planning will look at expense evaluation topics.

Please contact me if I can be of service, feel free to share an idea at johnjhogan@yahoo.com anytime or contact me regarding consulting, customized workshops or speaking engagements.  Autographed copies of LESSONS FROM THE FIELD – a COMMON SENSE APPROACH TO EFFECTIVE HOTEL SALES can be obtained from www.smartbizzonline.com, THE ROOMS CHRONICLE  www.roomschronicle.com , and other industry sources. 

All rights reserved by John Hogan and this column may be included in an upcoming book on hotel management.   The opinions expressed in this article are those of the author and do not necessarily reflect the views of this publication

John Hogan is  frequently invited to speak at Franchise Meetings, Management Company and hospitality association industry events.   He writes for a number of global online services and is actively involved in sharing industry 'best practices' .  He conducts mystery shopping reviews of quality in operations and marketing, including repositioning of hotels.

John’s background includes teaching university level courses as an adjunct professor at three different institutions over a 20 year period, while managing with Sheraton, Hilton, Omni and independent hotels.  He served as 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. 

Hogan’s professional experience includes over 35 years in hotel operations, sales & marketing, training, food & beverage, management development and asset management on both a single and multi-property basis.  He holds a number of industry certifications (CHA, CHE, MHS, ACI) 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.

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 3,200 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 almost 400 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: A Message for Hoteliers: Giving Thanks - and Not Just One Day Each Year! / Dr John Hogan / November 2008
Hoteliers Must Remember the Lessons of Reasonable Care! / John Hogan / November 2008
Enthusiastic and Sincere Attitudes Will Pay Off For Hotel Salespeople / Hotel Common Sense / John Hogan / November 2008
Unleash the Potential! Recognize the True Value of Your Front Line Sales People / Hotel Common Sense / John Hogan / November 2008
Defining Hospitality - Readers Respond with their Insights / Hotel Common Sense / John Hogan / October 2008
Understanding the Value and Power of Breakfast / Hotel Common Sense / John Hogan / October 2008
A Bakers Dozen of Strategies for Hotel Restaurant Managers / Hotel Common Sense / John Hogan / October 2008
A Bakers Dozen of Strategies for Hotel Food and Beverage Directors / Hotel Common Sense / John Hoganv/ September 2008
My Definition of Hospitality. What’s Yours? / Dr. John Hogan / September 2008
Principles for Success as a Hotel Manager: 6 Observations on Finding and Employing Problem Solvers / Dr. John Hogan / September 2008
10 Hotel Sales Action Steps to Succeed in Today’s Competitive Marketplace / Dr. John Hogan / September 2008
10 Hotel Sales Mistakes to Avoid in Today’s Competitive Marketplace / Dr. John Hogan / August 2008
Ways to Identify and Build Repeat Guests / Dr John Hogan / August 2008
Principles for Success As a Hotel Manager - Maintaining Relationships Throughout the Organization / Dr John Hogan / August 2008
Principles for Success As a Hotel Manager - Part four: Communicating with Clarity and Candor / Dr. John Hogan / July 2008
Principles for Success As a Hotel Manager - Part three: Using your management style effectively / Dr. John Hogan / July 2008
Principles for Success As a Hotel Manager - Part Two: Motivating the Team / Dr. John Hogan / July 2008
Principles for Success As a Hotel Manager Part One: Understanding the Organization / Dr. John Hogan / July 2008 
Updating Hotel Marketing and Sales Strategies Mid Year NOW Is Essential / Dr. John Hogan / June 2008
Don’t Underestimate the Impact of the Hotel Sales Office / Dr. John Hogan / June 2008
Factors for Successful Interviewing Potential Hotel Sales Candidates / Dr. John Hogan / June 2008
The Importance of Meaningful Sales Team Job Descriptions / Dr. John Hogan / May 2008
For Hotels with Limited Service, Fewer than 100 Rooms - How Do You Determine if You Need a Person Dedicated to Selling / Dr. John Hogan / May 2008
Extending Your Sales Team or Make Travel Agents A Regular Part of Your Sales Programs / Dr. John Hogan / May 2008
Finding Business Leads Can Be Easier Than You Think / Dr. John Hogan / May 2008
Understanding the Differences Between Marketing and Sales / Dr. John Hogan / April 2008
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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