Hotel Online  Special Report

Boutique Hotels: Rethinking the Fundamentals
in a New Business Environment

by Brenda Fields, February 2004

During the past decade, dramatic changes have occurred on all levels in the hotel industry. Eight years of record occupancies, average rates, and profitability were followed by a dramatic drop in occupancy, rate and profitability. During that period, technology advanced to the stage that, now, business is conducted almost exclusively with computers, cell phones, and palm pilots, and can be orchestrated as effortlessly in the back seat of a cab-- anywhere in the world-- as in an office! 

The cost effectiveness of technology, coupled with its global reach, has contributed to the new hotel environment. With the encouraging business outlook, hotels are now, more than ever, in a position to assess the new business environment and to establish a strategic business plan which incorporates these changes and are designed to grow and adapt to changing market conditions. 

Technology has brought numerous advantages to conducting business, including servicing existing customers and in reaching new markets. But as a service industry, it is important to ensure that technology is used to enhance guest satisfaction, especially in the case of free-standing boutique hotels. One key factor that differentiates boutique hotels from large or chain affiliated hotels is its personalized service.

Therefore, in order to benefit from the many applications of technology (i.e. reducing expenses, generating demand, and increasing guest satisfaction), and to simultaneously maintain the personalized services characteristic of boutique hotels, it is important for owners and managers to re-think and evaluate the following key areas:

Web Marketing:

Regardless of the size of the marketing budget, the Web has evolved into the most important component of the marketing plan. Properly developed, executed, and maintained, the Web will, at a minimum cost, effectively reach local, domestic, and international markets. It is especially important to understand the difference between the two key components, i.e. the artistry of the design and the technology, and how to integrate the two. Many times, Web sites are created by technology professionals who do not understand the nuances of marketing; and vice versa, marketing professionals who design a Web site only from a visual perspective, without consideration of how key technical components, built in, can drive demand.

An effective Web site design and effective an on-line distribution strategy require expertise. The lay person is bombarded with many ideas and is left wondering which approach to take. Therefore, if relying on expert advice, it is important to have a customized plan to accomplish specific short term goals, as well as ensure that the Web site is well positioned for future technological advances and for advancements with the search engines, in order to minimize financial risks.

With the growth of the Web, there are many parties creating ways to profit. Search engines, third party internet booking companies, and advertisers, to name a few, all have competitors, so they are ever-evolving in order to dominate the market and to increase their own businesses. Therefore, before going forward with a plan and to spend wisely, it is necessary to fully understand all of the options and choose the best ones for your short term as well as long term goals.


Just a few years ago, new technology helped owners and operators reduce expenses and create demand by centralizing reservations and providing a toll free number for customers. Now, with the new technological advancements coupled with new customer buying habits, the industry has evolved to using “on-line” and “off-line” reservations as part of its daily vocabulary.  Booking on-line reduces costs by reducing labor, but the key is to provide the information and service that will allow and encourage the customer to book and generate revenues! If the information is not there to help the customer make a decision or if it is not easy to book a reservation, business will be lost.

A small, boutique hotel can benefit from the advanced technology allowing customers to book directly on-line, using the Web site.  Planning and maintenance is the key, which can only be done by people exercising good judgment, not technology. Therefore, to maximize the on-line booking capabilities, designate a staff member to ensure that rates, promotions, and room inventory are consistently up to date, and that the customer has the ease of booking, revising, and canceling. A simple process of trying many hotel Web sites will help identify the elements which make a great reservations system from a customer’s perspective.

Guest Interaction:

In many ways, technology has created an impersonal way of doing business. But, we all benefit from the convenience it brings to our lives and enjoy the option of doing business 24/7 by using the Internet, e-mail, voice mail, text messaging, etc. We can order products and services from all over the world and have immediate access to information by just pushing a button! But keeping in mind that personal service generally distinguishes the small independent hotel from the large chains, it is important to evaluate the areas of guest interaction and measure the impact of technology. The personal touch of interacting with guests and potential guests in a warm, efficient, and professional manner, either over the phone or in person, is a powerful tool that fosters goodwill and guest loyalty, which translates to market share and revenues. 

By fully exploiting the product distinctions of small boutique hotel and using technology wisely, owners and managers are well positioned to compete against the large chains to impact market share, minimize expenses, and generate profitability. 

Brenda Fields 

In her more than 20 years as a marketing and sales pro in the hospitality industry, Brenda G. Fields has emerged as the “go to” consultant for independent and/or privately owned hotels and resorts seeking real-world solutions for today’s market challenges.

From small boutique hotels to large convention properties, Brenda has created and implemented highly successful marketing and yield management programs that enable owners to achieve target results despite market conditions.  Most notably, she helped a 1,400 mid-town Manhattan hotel realize 86% occupancy two years running in a depressed economy, resulting in the achievement of proforma and first place in market share out of 14 competitors. For a small, four-diamond property on Park Avenue, she helped turn-around declining sales resulting from increased competition from nearby chain-affiliated hotels through a restructuring of the sales department and effectively increased distribution channels to reach new markets.

With extensive expertise in pre-openings and repositionings, Brenda was responsible for the successful opening and stabilization of the Paramount Hotel in New York, for which she developed and executed a direct sales and yield management program in addition to a national and international marketing campaign.  As a result, the strategies and structure she designed and implemented continue to be used as the prototype for new acquisitions by Ian Schrager Hotels.

With a “who’s who” roster of clients, Brenda has worked with a number of industry leaders and real estate investment companies including Starwood Lodging Corporation, Vornado Realty Trust and Planet Hollywood, John Hancock Mutual Life Insurance Company, Olympus Real Estate Corporation, Gotham Hotels and Apple Core Hotels, among others.  Her growing consulting practice for independent properties includes clients such as The Kitano Hotel, New York; Founders Inn and Conference Center in Virginia Beach, VA; Woodlands Resort and Inn, Summerville, South Carolina; Bel Age Hotel, Los Angeles, CA; Mondrian Hotel, West Hollywood, CA; and many others, including international clients.

A native of Kentucky, Brenda holds a B.S. in Psychology and English from Murray State University.  She lives on Manhattan’s Upper East Side and enjoys cooking and entertaining in her cottage in upstate New York.

This article is the property of Brenda G. Fields and cannot be reprinted or copied in part or whole without the written consent of Brenda G. Fields.

Brenda Fields
500 E. 77th Street, #1101
New York, New York 10162


Also See: Room Configuration - Are Your Rooms Configured for the Best and Highest Use? / Brenda Fields / January 2004
Direct Sales - What to Expect from Your Hotel Sales People and How to Get Results / Brenda Fields / August 2003
Boutique Hotels: How to Survive in a Down Market - Getting Back to Basics / Brenda Fields / May 2003
Industry Marketing Pro Brenda Fields Opens Consultancy Focusing on Independent Properties / January 2003

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