Hotel Owners Have All the Juice
March 7, 2019 10:15am
by Alan Young
Who really has the buying power when it comes to hotel technology purchases?
As any good salesperson knows, selling a product (or service) is as much about describing the features and benefits of product itself, as it is being able to effectively sell to the potential buyer. It's a dance, one in which an in-depth understanding of the buyer's unique expectations and values will (more often than not) be the key to making that sale. And of course, the key to appealing to buyers directly begins with understanding who holds the buying power.
When it comes to the hospitality industry and the purchase of hotel technology, most B2B tech vendors believe that the hotel brands themselves are the focal point for the purchase decision making process. After all, big brands represent huge potential business, and with the hotel landscape being multi-layered (owners, management companies, advisors etc.) shouldn't the sales focus appeal to the brand's top-line?
In fact, this can often be a flawed approach to selling B2B hospitality technology. But if that's the case, who really has all the juice when it comes to either persuading the brands about what technology purchases make sense, or making the buying decision themselves?
To better understand a more effective approach, we need to take a closer look at the infrastructure which supports hotel properties, and those coinciding authorities. Larger hotel brands with properties across the globe can dictate certain aspects of the hospitality experience within each property agreement. After all, if a prospective hotel owner is buying into an established hotel brand and all of the associated marketing and sales benefits, it becomes imperative that certain segments of that 'brand' are consistent across all properties. This includes things such as the CRS, mattresses, labour standards, etc.; however - and perhaps surprisingly - hotel brands often have difficulties dictating the purchase of specific hotel technologies. Ultimately, it is often the hotel owners who carry the most power when it comes to technology purchase decisions and initiatives.
Traditionally, hotel brand giants (such as Marriott or Hilton etc.) have been popularly viewed by technology vendors as the 'Golden Goose' or, in other words, the gateway to success. Why? Because a large brand with countless properties and owners represents an exciting (and extensive) business opportunity, right? While this is true in a sense, it is extremely unlikely that the brand itself will mandate some tech solutions down to franchisees or owners that is outside of the reservations control environment.
Let's put this theory to work by considering the following scenario: Independent hotel A would like to become part of a larger, flagged hotel company. When the transition occurs, Hotel A may already have a PMS, POS, Sales and Catering solution, etc. in place. The likelihood of the owner of Hotel A swapping out all (or some) of these systems in order to comply with the brand standard is somewhat unlikely. If their PMS can connect with the brand's CRS and some other reporting standard solutions, the other systems could remain in place for quite some time. As such, ancillary technologies such as text messaging solutions, mobile check-in and out platforms and many other will be decided by ownership, not the brand.
With this in mind, knocking on the door of the brand itself should never be the first step. In fact, gaining the approval of the brand in most cases essentially just grants a green light to then approach individual owners, leaving technology vendors no closer to the desired finish line of making any actual sales. You've been granted access to the building, sure, but you've yet to infiltrate any of the offices, so to speak.
Rather than approaching the brand, technology vendors should seek out opportunities to connect with small or medium size ownership companies. These companies will often have multiple flags and, once a sale has been made, word of that technology upgrade or new solution can percolate upstream with much more ease than if it were a mandate trickling downstream. In that same breath, the more hotels an ownership group has, the higher the likelihood they have to make (positive) noise and garner attention from the brand itself, in which case the brand will often do whatever the owner considers to be the best decision for the property.
Not only that, but it's the hotel owners who will have a more intimate grasp on the demands directly associated with their specific property, and will therefore have a stronger opinion regarding appropriate tech solutions. The business focal points, concerns and long-term goals may be different depending on who you ask (brands vs. owners) and, thus, it's important for technology vendors to go right to the source and deliver their proposal head-on. Hotel brands and hotel owners have a symbolic and co-dependent relationship, but it's not without its unique dynamic. It's important to recognize the increased autonomy which owners have when it comes to tech-related decisions for the long-term success of their property. While the larger hotel brand has a pre-established image that current and prospective travelers are likely familiar with, it's ultimately up to the hotel owners to identify the tools and resources their property needs to succeed and remain competitive. Ultimately, when it comes to moving the dial for their flag, hotel owners occupy the power position.
Tags: hotel technology,
Alan E. Young is the Co-Founder and President of Puzzle Partner, the leading agency specializing in hospitality and travel technology marketing. Previously, Alan has held executive level positions with start-up companies such as Newtrade Technologies, (acquired by Expedia), Hotel Booking Solutions (acquired by IBS Software) and TrustYou. Alan is past Chair of The Board of Directors of The OpenTravel Alliance and been very involved with other industry associations most notably AHLA, HEDNA, and HTNG. With over two decades of experience in the travel and hospitality technology world, Alan specializes in helping innovative companies achieve winning performance and dramatic growth. You can connect with Alan on LinkedIn.
Can Artificial Intelligence Replace Human Intelligence in Hospitality Revenue Management?
Apple Core Hotels, Inc. Selects Cendyn to Power CRM Across Hotel Group
New SiteMinder Study Reveals Economic Turmoil Is Not Holding Latin Americans Back From Traveling
Shiji Group Opens New Office in Washington D.C. Metropolitan Area to Continue Expansion in the Americas
YOTEL Makes INTELITY a Brand Standard
Hapi Announces Availability of “Hapi Connect” on Salesforce AppExchange, the World's Leading Enterprise Cloud Marketplace
The Queens Hotel in Canada Sees 20% Growth in Revenue With Hotelogix
TPI Hospitality Leverages ProfitSword Integration to Maximize Business Intelligence Transparency and Efficiency Across Organization
Hotel Data Management: Build an Integrated Journey
Newmark Hotels Joins With Pegasus/Travel Tripper for Comprehensive CRS Solutions
Hotel Booking Engine Launched by Bedvine
StayNTouch CEO and Director of Strategic Partnerships Talk Platform Power
Azalea Hotels & Residences in the Philippines Sees a 30% Increase in Its Revenue With Hotelogix
RCD Hotels Taps Duetto to Drive All-Inclusive Technology Innovation
Opportunity for Hotels Is Big: SiteMinder Report Finds Travel to Germany Is Outpacing EU's Top Destinations
Cloud5 Communications Upgrades Internet to GPNS Standards at the Key West Marriott Beachside Hotel
Cendyn Launches the All-New ePlanner Platform
Different Travelers Want Different Things - So How Do You Know What Hotel Technology You Need?
Weaving Your Way Through Vendor Madness: What Should the Perfect Hotel Tech Partner Look Like?
ALICE Sweeps the 2019 HotelTechAwards
Please login or register to post a comment.