Carol Verret Consulting
Hotel Sales in a Limited Service
Carol Verret / August 2002
|by Carol Verret
Once upon a time not too long ago, prior to September 11, hotel sales in a limited service environment was reasonably straightforward. PKF was anticipating that this sector would be the ultimate beneficiary of the economic downturn as customers traded into this sector from the higher rated full service, mid-market and luxury sectors. At the time this was written, in late August, the limited service and all-suite sectors were expected to maintain their profit levels in 2001. The rules have changed.
Until now, limited service hotels experienced a slight decrease in demand in most markets but not stunningly in relation to their full service competitors. Many limited serve hotels did not use a sales person, rather the GM, who had absolutely nothing else to do, was expected to function as the sales person as well. In my experience, most of those sales calls never happened - not because of the lack of good intentions but the lack of time. However, as long as everything was relatively rosy, no one admonished the GM for not making those sales calls.
In those situations where there was a sales person, it was usually someone with limited sales experience, perhaps promoted from the front desk. The most common reasons for this was the position was not very well paid and the job market was so tight that it was virtually impossible to attract someone with sales or hotel credentials at that salary. The rules have changed.
The GM who never had time in the first place now has less time as many hotels have cut staff to respond to the dramatic drop in occupancy. While this may be somewhat shortsighted, it is the GM who is picking up the slack at the front desk and performing front office procedures. There is no way that the GM has the time to contact all of the accounts and ascertain the conditions of the changes in their travel policies, their new rate sensitivity and what it would take to get what little remains of their business.
In an environment where the rules have changed, the temptation on the part of owners and management companies is to hunker down - slash the staff to the bone, eliminate all sales and promotion expense and let the salaried managers pick up the difference by working additional hours. Those hotels that have been operating a flabby organization may benefit in the short term but it is not the strategy that will position a hotel to survive and succeed in the next six to nine months of uncertainty and potential recession.
Make no mistake - there will be winners and losers in this new environment. The parameters of success for the winners won't be as grand as they were a brief twelve months ago but the penalties for the losers never change. Erosion of the asset and the ultimate penalty, foreclosure, is the consequence of short-term thinking. What then, are the steps to take to deal with the new rules of the game?
Formulate a strategy based on possible scenarios. Does anyone remember the Gulf War and the devastating impact it had on the travel industry in 1991? Those who survived positioned themselves well for the future. Resist the urge for knee-jerk reactions and take time to sit down and outline a unified strategy for the next twelve months. What will be the financial strategy, where is the demand likely to come from and how can we get it in the most cost-effective way possible? Ask someone from the corporate office to sit down with the staff and develop these strategies. If that resource is not available to you, enlist the assistance of a knowledgeable but neutral outsider to facilitate the process. Don't wait too long to engage in this exercise.
Get in touch with your accounts now! Many hotels did not adequately track where their business was coming from in the past when demand was high. Those hotels have a steeper learning curve than those who had the foresight to use the tracking capabilities in their franchise reservations systems. Do not ask the GM to perform this function - it is not going to happen! If you have a sales person, be very specific about the direction you want them to take, the deals they can cut. If you don't have a sales person, get one or contract to a sales and marketing person who will perform this function for you in the short term, like the next six to nine months until things stabilize. The benefit of the latter option is that you incur no payroll burden and you can hire more expertise than you could afford long-term. Get in touch with your guests! Who are your guests - the ones that fall into the transient or regular corporate category? These are the guests that 'fall through the cracks' - independent travelers, consultants, brokers, etc.. These are also the people who will continue to travel -- it is their livelihood. Find out who they are and spoil them. Ask the front desk GSAs, they know the guests better than the GM. The GM should be in the lobby at check-in and/or chatting with the guests at breakfast at 6:30am. Upgrade the Guest Service staff! With the airline industry laying off so many customer service associates, it is an excellent time to hire people with experience and personality. It is an opportunity to eliminate those GSAs that were hired because they fogged the mirror -- the ones who couldn't be bothered smiling at a guest or making eye contact.
Invest in some short-term training to upgrade the skills of the sales and customer service staff. If you can't afford to hire experience, train the staff you can afford. This is an investment you can't afford not to make. Find training that produces results tailored for your situation. It can be seminars or distance learning that does not require time away from the property or the job.
The winners under the new rules will be those that resisted the urge to react with short-term thinking. The winners will be the ones who positioned themselves for the future and not just reacted to the immediate situation. People will travel again by air and by car. Their requirements of us do not change - a good product and good service at a fair price. The limited service sector is well positioned to take advantage of this situation when the shock of the last two weeks wears off.
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|Also See:||The Challenge of Marketing Independent Boutique Hotels / Carol Verett / Aug 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|