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In Today's Economy Is the Hotel Industry Being Too Polite?

Survival Tips for the Bold & Shameless Hotelier

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by Daniel Edward Craig, April 2009 Hotel Darwinism

Lately I’ve come across all sorts of how-to articles for surviving in today’s economy, and it strikes me that, in typical fashion, the hotel industry is being far too polite. This is war, people; only the strongest will survive—for God’s sake don’t let it be your competitor. To secure your hotel’s place on the evolutionary scale, consider adopting some of the cutthroat tactics of our colleagues in other industries. 

Make rates a moving target. These days, travelers demand discounts, but that doesn’t mean you have to keep lowering your rates. Instead, borrow a tactic from the retail industry and jack up your rack rates to give the illusion of huge discounts. Phrase it like this: “No, I’m not joking, Mr. Bottom-Feeder, I’m offering you this gorgeous Deluxe Land-Fill-View Room, which normally sells for $1,595, for only $99—a 94% discount!” Adopt the crafty pricing strategies of the airlines by changing rates constantly to confuse travelers. Advertise irresistibly low rates and then tack on hidden fees, inexplicable taxes and surcharges on surcharges. Implement automated pricing software that increases rates the instant the traveler decides to reserve. 

Exasperate your guests for fun and profit. Design the online booking experience to be so frustrating guests have no choice but to call in, in which case they should be charged a booking fee. Create twenty or more room categories and insist on listing all of them, prompting time-pressed callers to blurt out, “Just book me a damned room,” in which case you should always reserve the highest-rated suite. If a caller insists on a standard room, politely explain that these rooms are reserved for the lowest echelon of traveler—namely government employees, Entertainment Book holders and Priceline customers—and are never available anyway. 

Make frills and flexibility a thing of the past. Follow the shining example set by the airlines and reduce the guest experience to a room with a bed, charging a fee for everything else. Implement a luggage fee and charge extra for oversized baggage, baby carriages, wheelchairs, Seeing Eye dogs and portable dialysis machines. Charge a user fee for blankets, towels and soap and a fuel surcharge for hot water. Implement reservation change fees and charge a rate differential even if rates have gone down. If a guest cancels, charge the full amount and issue a voucher with so many conditions it’s impossible to redeem. Distribute stopwatches to front desk and housekeeping staff and charge by the minute for late checkouts and early check-ins.

Cut costs by delegating work to guests. Travelers have made it clear that nothing is more important than getting a deal—isn’t it time they made a few sacrifices of their own? Save labor costs by introducing “Do It Yourself” packages in which guests carry their luggage, clean their rooms and serve themselves meals. Reduce operating costs by closing your restaurant and having the turndown ladies sell pre-prepared meals from maid carts. In this time of “rightsizing”, does your hotel really need corporate office? Consider downsizing up. 

Create new revenue streams with trumped-up charges. Implement a surcharge that sounds like a government tax but actually goes to the hotel, such as a “6% Hotel Occupancy Levy”. If a guest questions the charge, speak quickly and use lots of industry jargon. 
Reduce lost mini-bar revenue by hooking guests up to a polygraph machine at checkout. Process false charges to credit cards several weeks after departure, banking on the likelihood travelers will be too busy to dispute them. If they do, put them on hold for up to one hour and then transfer them to someone in Accounting who doesn’t speak English. Guests will pay exorbitant prices for parking, porn and Grey Goose vodka; test their limits by hiking up rates until consumption drops.

Boost your conversion ratio with false advertising. Post photographs on your website that make your rooms appear larger, cleaner and less dumpy than they are. If necessary, cut and paste images from websites of luxury hotels in foreign countries. Use superlatives like “award-winning”, “seven-star” and “most luxurious”. Guests will be disappointed, but the front desk will clean up the mess—they always do. Boost TripAdvisor ratings by posting glowing fake reviews, relating inspiring stories like how the concierge saved a guest’s life by giving him a tracheotomy after he choked on a pillow chocolate. Post blistering reviews of competitor hotels, reporting rumors of a faulty fire alarm system, a bed bug infestation or a recent e-coli outbreak.

Kickstart spin-off businesses. Now that mini-bar offerings have proliferated to virtually every surface in guestrooms and all furniture comes with a price tag, hotel rooms resemble a cross between a 7-Eleven and an Ikea showroom. Take this trend a step further by renting out your employees to guests to take home: a concierge to act as a personal assistant and issue Twitter updates; a bellman to act as a chauffeur and open doors; a housekeeper to ensure toilet paper ends are tucked into a perfect fold. Why allow items left behind in guestrooms to languish in lost-and-found when they can be sold on e-Bay? If guests call looking for them, remind them that the hotel cannot accept responsibility for lost or stolen items. 

Necessary survival tactics or a lighthearted warning about the direction the hotel industry could be heading? You decide. If we can learn one thing from the airline industry, it’s that slashing services may make prices more attractive, but it doesn’t guarantee profitability. In fact, it deters people from travel by taking all the pleasure out of it. Hotels will be better positioned for long-term survival by continuing to offer a haven for harried travelers, providing the flexibility, the integrity—and yes, the occasional freebies—we built our reputations on.
 
 


Daniel Edward Craig’s third mystery novel, Murder at Graverly Manor, comes out in April 2009. Craig has worked for luxury hotels across Canada, most recently as general manager of Opus Hotel in Montreal. His blog provides a frank and entertaining look at issues in the hotel at www.danieledwardcraig.com
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Contact:
Daniel Edward Craig
Email dcraig@telus.net
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Also See: From Record Highs to Historic Lows - Las Vegas Room Rates Droping Fast / April 2009
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