Carol Verret Consulting
Independent Hotels & Resorts;
Ride the Wave or Float with the Tide?
|by Carol Verret, March 2005
Okay, so you independent resorts and hotels have noticed an up tick in business -- BUT where are you in comparison to the market and to last year? There is an old saying, "A rising tide floats all boats."
If you are posting only a 5-7% increase in revenue over last year, then you are only tracking the industry average. Congratulations -- your boat is floating.
What's wrong with that? Nothing if bobbing around in the water is all that the owner expects. But let's think about this. A "floating boat" has no forward momentum and the level of the tides that ebb and glow dictates its "level."
So do you want to float or do you want to have the ability to "steer" this boat regardless of the tide -- ride the highest wave? Do you want forward momentum that puts you in control of the property's revenue and destiny?
There are cost-effective ways of positioning your independent hotel and resort but they must be co-coordinated. The following is the bare bones of a targeted plan:
Rate and Offering Positioning: First of all you must decide on a rate structure in relation to your position in the market with your competitive set. Who is your competitive set? That will vary depending on the type of facility, location and season. For example, I had a client, a resort whose competitive set was other lodging facilities in the area for meetings in the off-season, but whose comp set was regional and national for leisure travel in the busy season. The same client however, believed her rooms were worth the same rate every day of the week, every month of the year. Your room is only worth what your target guest is willing to pay -- and that may be a lot less in January in the northern part of the US versus what they are willing to pay in July.
Revenue Management Strategy: What will your revenue management strategy be? Revenue management for a small property may be as simple as a spreadsheet with formulas so that you can manage the inventory in a Best Available Rate block allocation. If you are a mid - to large sized property, invest in the best revenue management system you can afford. You will see a healthy ROI if you put an internal system into place. You will also want to determine who will manage the yield on a daily, weekly, monthly basis? Which leads to the next section â€“
Property Management System: The investment in a good PMS system is worth every penny. However, most property management systems can produce the reports and the data you need to manage the property. The issue is how well does the current staff know the system. Often a system was installed and training was given on the basics and finer points of the system but only the basics have been passed on and no one is left who remembers where to locate the denials/regrets reports, how to harvest mailing labels or email addresses for Customer Relationship Management, etc. Call the provider and ask if there are updates for the system that you can purchase and upgrade to the best functionality you can afford.
Web Site and Search Engine Optimization: Just because your nephew, friend or friend of a friend (fill in the blanks) creates web sites, resist the urge to call them! One hotel I know followed this strategy and eight months later was waiting for corrections to be made because the web site developer had to get a day job! An entire book could be written about this subject but in brief -- find someone who specializes in the hospitality industry -- there are many good ones. First and foremost, it is about functionality not art. The ability for a potential guest to check availability and make reservations in "real time" is revenue waiting to flow into your hotel. Make it easy for people to give you money! Key words and links should be decided upon before the copy is written and need I mention accurate web traffic reports?
GDS Presence and Reservations Capability. One of the wisest investments you can make is to hire a company to provide 800 number reservation services and GDS placement that will be picked up by the E-commerce channels. First of all, you probably are expecting the front desk staff to service the guest and sell reservations at the same time. Bad idea! Many of your desk staff may be hired because your local labor pool is limited and they could smile and fog a mirror not because they are good at sales. Even if they were, you would have to spend more time and money training them to do that on a continuing basis to compensate for turnover. Additionally, when the phones are the busiest for peak season reservations so is the hotel.
Group Sales: A well planned group sales effort can support your property in the off-season and maximize revenue in peak season. A thorough examination of revenue drivers with one client led us to promote weddings in the peak season on weekends as the rooms were guaranteed at a high rate AND the average per person banquet price was $86 per head, not including alcohol, which flowed freely at this destination resort as no one drove home. Could we have gotten a higher room rate -- yes, slightly, but could we have replaced $10,000 to $15,000 of banquet revenue per weekend? Not likely.
The above is only the tip of the iceberg. I have one client of an independent
whose case study I would have liked to include but I couldn't reach him
to ask his permission -- he is too busy handling 92% occupancy, up from
less than 40% last year. He is riding the wave -- not floating on the tide.
CVCT, Carol Verret Consulting and Training, offers consulting and seminars on incorporating and using e-tools to enhance productivity and functionality as well as revenue management and customer service. Our associate, Tony D'Angelo, specializes in HR consulting and seminars.
Carol Verret, in association with HotelTraining.com has an online sales training module that deals with New Business Development and developing client profiles by market segment.
Contact Carol at email@example.com and log onto the company web site www.carolverret.com. The company can be reached by phone at (303) 618-4065. Log on for info about live web casts and online training modules that also address these issues.
copyright © Carol Verret, 2002-2003 -2004 -2005
5910 S. University #C-18, PMB 374
Greenwood Village, CO 80121
Telephone: (303) 618-4065
Web Site: http://www.carolverret.com/
|Also See:||Hospitality Sales Training Companies Reach Across the Competitive Playing Field to Combine Live Seminar Expertise with the Convenience of the Internet / Carol Verret / January 2005|
|Revenue Management - The Challenge for Hotel Sales / Carol Verret / January 2005|
|Hotel Sales Departments -- Issues in Processes and Functionality / Carol Verret / November 2004|
|The GM'S Role in Revenue Management / Carol Verret / October 2004|
|Transforming the Hotel Sales Organization; Alignment with the New Realities of Sales / Carol Verret / August 2004|
|The Revenue Management Strategy - The Pre-Plan Marketing Plan / Carol Verret / July 2004|
|Hotel Revenue Management this Summer - a Game of Skill, Art and Most of All Nerves / Carol Verett / May 2004|
|What Do Meeting Planners Want? Hotel Sales Managers Want to Know! / Carol Verret / May 2004|
|Revenue Management -- The Integration of Revenue Drivers / Carol Verret / March 2004|
|CYBER SALES -- Hotel Sales in an Internet World is the New Reality / Carol Verret / February 2004|
|The New Realities of Hotel Sales - Focus on Revenue Generation / Carol Verret / January 2004|
|Hotel Sales -- Innovation in the Face of Limitations / Carol Verret / November 2003|
|The Good News & the Bad News; Improving Economy = New Hotel Development / Carol Verret / October 2003|
|Leadership - General Managers Managing the Sales Process / Carol Verret / October 2003|
|When the Crystal Ball is Cloudy; Marketing Plans for 2004 / Carol Verret / July 2003|
|Partnership of Sales and Technology; Using Tech Tools to "Sell" the Hotels / Carol Verret / July 2003|
|Back to the Basics? The Basics of Hotel Sales Have Changed! / May 2003|
|Creating Sales "HUNTERS": The Skill Sets Required in the New Hotel Sales Environment / April 2003|
|Heightened Security Requires New Strategies in Hotels Sales / Carol Verret Consulting and Training / Mar 2003|
|Revenue Recovery - Building The ‘A’ Team in Sales / Carol Verret / January 2003|
|Contingency Marketing Plan – War In Iraq! / Carol Verret / November 2002|
|Playing the Rate Game - Positioning -- Positioning -- Positioning! / Carol Verret / October 2002|
|The Rate Game - Playing to Win / Carol Verret / October 2002|
|The Challenge of Marketing Independent Boutique Hotels / Carol Verett / August 2002|
|Hotel Sales in a Limited Service Environment - The Rules Have Changed / Carol Verett / August 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|