By Jay Delerno
Over the past year I have seen hotels focus more on driving occupancy
than rate to improve their RevPAR. While hotels may not be able to
achieve the higher average rate of the pre down turn, there are opportunities
locally they can exploit locally to drive rate even in the current economic
The first step a property must take is to not accept the “new
normal”. That is to say do not accept the current ADR, or occupancy
of their property. While a hotel may not be able to achieve the occupancy
and ADR of 2007 or the first three quarters of 2008 (the old normal), it
can do better in RevPAR in 2009 even if the economy remains flat or even
declines slightly. What I am saying is and the “new normal” is “THAT”
and hotels should not accept it if they expect to substantially improve
their RevPAR in 2010.
The second step a property must take is to identify different
Demand Generators in their local market place which can drive rates and/or
room nights volume higher than third party Internet sites. For our
purpose a Demand Generator is defined as anything that has the ability
to physically bring or attract business to a market place. Some examples
of Demand Generator are hospitals, universities, airports, local companies
and Interstate Highways.
After identifying the Demand Generators in their market place, a property
must qualify them. Let’s say you identify a hospital as a different Demand
Generator because it has been ignored in the past when times were better.
The qualification phase of a hospital is to make a personal call on
each of the following departments to understand what business they have
and what you can do to attain that business.
Visiting physicians, speakers or specialists- over night stays
Preferred Hotel Directory- advertising as generally hospitals look for
favorable rates for patient coming in from out of town plus their families
need accommodations also. Patient post operation care is another
source of business when they cannot stay at the hospital but need to remain
Any other hospitals that they operate in the area
Names of various hospital medical directors
Educational Director - seminars and visiting instructors
Special Services Director- parties, banquets, etc.
Director of Nursing- names of Head Nurses
Director of Volunteers- their activities
Director of Physician Relations – names of specialists
Public Relations – visiting dignitaries and patient families
Purchasing/Medical Supply – purveyors and companies that call on them
Head Nurse Station on each floor – family and friend referrals that may
want to stay in a hotel rather than driving home
Admissions – family referrals
In-Patient Services – family referrals and patient referrals if they require
further treatment but can not say in the hospital
Human Resources/Personnel– relocations, employee parties, meetings and
Specialist Units – cosmetic, heart, cancer, etc which require outpatient
follow-up care for long term stays.
Area Employee Professional Associations for monthly and annual meetings
and banquets- housekeeping, physicians, hospital administrators, radiologists,
Continuing Education– each specialized area will be represented in a teaching
A hospital is just one of the Demand Generators many hotels have in their
market place. During my career the people I have worked with and I have
identified over twenty-five local Demand Generators many of which produce
a variety of business for a hotel. If we think in terms of events
that occur at venues rather than just the venues, the number of Demand
Generators in a metropolitan area are in the hundred if not thousands.
The third step is to develop a plan with rates, amenities/services
due dates and responsibilities to be used to “attack” all of the departments/areas
with in the hospital. “Attacking” the hospital is best done through
personal calls. The personal calls should be supported by advertising
and public relations should these opportunities become available.
For additional ADR and occupancy in 2010 remember………………..
Do not accept the “new normal”.
About Revenue Source One:
Identify different Demand Generators in your local market place.
Qualify the identified local Demand Generator with personal calls.
“Attack” with personal follow up calls and eventually bookings/room nights
Revenue Source One was founded in 1987
and provides sales and marketing consultation to hotels. Identifying
and developing plans to solicit Demand Generators is one of the company’s
services. Some additional services offered are Sales and Reservations
Mystery Shopping and Training, and Internet Based Mystery Shopping. A complete
list of services as well as partial list of current and past clients can
be viewed at the company's web site www.revenuesourceone.com