News for the Hospitality Executive
Key Lessons Shared with Future Hoteliers at Penn State
Did you happen to catch CNBC’s December documentary “Behind Closed Doors at Marriott”?
When asked about “fade rates” or “the Fade” - - a term used to describe the act of potential guests without reservations negotiating for heavily discounted rates at the front desk for a room that same night - - Marriott revenue guru David Roberts told CNBC investigative reporter Scott Wapner that Marriott “never does that.”
“If you do that,” Roberts said, the hotel has just trained that customer: “Don’t book in advance.”
In a recent article David K. Hayes and Allisha A. Miller, authors of “Revenue Management for the Hospitality Industry,” underscored Marriott’s policy further and described the “four revenue optimization errors” associated with the use of fade rates.
Even today, as a professional consultant, I experience prospective client push back on my established fees.
The Picasso principle
Whenever I need reminding of the value and importance of established rates and professional fees, I read “The Picasso Principle” chapter from Harry Beckwith’s “Selling the Invisible.”
Beckwith uses a story about Pablo Picasso to demonstrate what talent and thought are really worth.
“Picasso, one of the greatest and most influential artists of the 20th Century, lived most of his adult life in France. A woman was strolling along a street in Paris when she spotted Picasso sketching at a sidewalk café. Not so thrilled that she could not be slightly presumptuous, the woman asked Picasso if he might sketch her, and charge ‘accordingly’.
Picasso obliged and in just a few minutes, there she was: an original Picasso.
‘And what do I owe you?’ she asked.
‘Five thousand francs,’ he answered.
‘But it only took you three minutes,’ she politely reminded him.
‘No,’ Picasso said. ‘It took me all my life.’”
Beckwith’s message to his readers: “Don’t charge by the hour. Charge by the years.”
Penn State student takeawaysThe above is one of many lessons I have learned from my hospitality industry experiences, some of which I was honored to share last fall when I addressed students at the Penn State School of Hospitality Management.
The students were required to submit written takeaways from my presentation. Here is a sample of what they recorded:
Two other highlights of my time on campus: my stay at the historic Nittany Lion Inn and a trip to The Creamery for some real ice cream. I very much look forward to returning soon to not only share more lessons but to do more learning on my own.
David M. Brudney is a founding member of International Society of Hospitality Consultants
Smaller Hotels Must Plan Their Work and Work Their Plan / David
Brudney / September 2012
can’t microwave marketing experience / David Brudney / July 2012
Selling Necessary with Meeting Demand Returning / David Brudney /
Successful Experiment With Hybrid Meetings / David Brudney / March
Leven Bullish on Las Vegas Group Demand / David Brudney / December
Forecast Bodes Well for U.S. Hoteliers / David Brudney / October
Search Producing Positive Results for Hoteliers / David Brudney /
Time to Revisit the Art of "Check-Building" and "Add-Ons" / David
Brudney / July 2011
Business Lost by Hotel Sales Department Interruptions and Lack of Focus
/ David Brudney / June 2011
Commitment to Excellence is Harry Mullikin’s Legacy / David Brudney
/ May 2011
Meetings: An Idea Whose Time Has Come / David Brudney / April 2011
Gen Hotel Sales Pros Hungry for Storytelling / David Brudney /
Works Best Upclose and Personal / David Brudney / February 2011
to Change: Hotel Sales Professionals New Year’s Checklist / David
Brudney / January 2011
Sales Professionals: Would You Buy What You Are Selling? / David
Brudney / December 2010
Planner Voices Concern over Demand Return / David Brudney /
|Value of Face-to-Face Meetings Resonates Even More Today / David Brudney / September 2010|
|Expect Hotels to Pare Back on Perks in 2011 While Implementing Modest Increases in Room Rates / David Brudney / September 2010|
|Good News for Meetings-Driven Resorts: Site Inspections and Bigger Group Bookings are Back! / David Brudney / August 2010|
|Kimpton Is Bullish on Fourth Quarter 2010 / David M. Brudney / June 2010|
|Landmark Decision by Arbitration Panel on Aviara Resort / David M. Brudney / April 2010|
|Group Business Comeback in the Cards / David M. Brudney / March 2010|
|Applying Five Tenets of Hotel Sales and Marketing in These Tough Times / David M. Brudney / January 2010|