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. . Contrarian Strategies for Hotel Sales Departments to Thrive in an Economic Downturn . |
December 16, 2008 - This is the time for bold strategies and actions � when everyone else is �hunkered down� it is time to get aggressive � if you go on the defensive in this economy, you�re toast! Despite the dire predictions that are hitting us every day, there are hotels out there that are making money, on track with last year � a position that every hotel would welcome at this point. In the latest forecast from PKF, they are predicting that REVPAR will decline by 7.8% nationwide next year. �The expected 2.5 percent fall off in demand, combined with a 2.9 percent increase in supply, will result in a 2009 year-end occupancy level of 57.6 percent. This represents a 5.3 percent decline in occupancy, and is 5.1 percentage points below the long-term average occupancy level for U.S. hotels tracked by STR of 62.7 percent. �The combination of above average net increases of supply occurring simultaneously with dramatic declines in demand is something we have not seen in recent industry recessions. This is what makes this downturn so severe,� Woodworth said. (December 9, 2008) Smith Travel in conjunction with e-forecasting.com declares the industry to have a 99.9% chance of slipping into recession. Chief Economist Evangelos Simos of e-forecasting.com said, �Using the NBER methodology to identify the peaks and troughs of the business cycle, the peak was in November of 2007 for the industry. Since then, the index has been declining and so far the recession is 13 months old. Looking further at the six month growth rate, at this time, the recession appears to be similar to what the industry felt in late 1979 through early 1980, but not yet quite as bad as 2001.� (Smith Travel, December 9, 2008) The most effected markets are those that have the greatest entry of new hotel supply in the market, those that are dependent on airlift and have had capacities cut severely as well as leisure resorts that rely on disposable income, such as many of the ski resort areas. However, even the properties located in these areas can have an impact on their business by not buying into the �doom and gloom� chicken little syndrome that the nation and the industry has fallen victim to. There is a saying in the theatre that when everyone else on stag e is standing still, move if you want to be noticed. A contrarian strategy is similar in that when everyone else is paring down their expectations of the sales and marketing efforts, the contrarian strategy is to do the opposite. What are some of the contrarian best practices that successful hotels are implementing?
Carol Verret and Associates offer training options at various price points � invest in your people! Also, watch for the book Hotel Sales & Revenue Management 2.0 coming in November. Reserve your copy at [email protected]. Carol Verret And Associates Consulting and Training offers training services and consulting in the areas of sales, revenue management and customer service primarily but not exclusively to the hospitality industry. To find out more about the company click on www.carolverret.com. To contact Carol send her an email at [email protected] or she can be reached by cell phone (303) 618-4065. Visit www.hotelsalesblog.com. copyright © Carol Verret, 2002-2003 -2004 -2005 - 2006 - 2007 - 2008 |
Carol Verret 5910 S. University #C-18, PMB 374 Greenwood Village, CO 80121 Telephone: (303) 618-4065 [email protected] Web Site: http://www.carolverret.com/ Email: [email protected] |