EyeforTravel: Revenue Management for Small & Independent Hotels

A presentation at EyeforTravel by Scott Bacon, Senior Revenue Account Manager, Preferred Hotel Group.

Infrastructure is a challenge for small, independent hotels. To overcome that, build a solid training program. Build a library of information. If you don’t make that investment, you hurt your hotel’s profitability.

Invest in efficiency. If you have to track multiple data dashboards, you waste time.

If you’re small, you can be quick & nimble. Capitalize on that.

The “average-ness” of averages.

Industry research can be construed & misleading. Don’t rely on it completely. Look at data in a way that is meaningful, and use frequency distribution.

How can hotels price competitively to gain exposure while maintaing rate integrity?

Package with value-adds. Stay “under the radar” with private pricing offers (semi-opaque channels).

How can hotels build guest loyalty with a rational pricing strategy?

Build a guest recognition program. Never ask “have you stayed with us before?” – you should know that answer already.

You don’t have to give away upgrades…just recognize your loyal guests.

How do you increase revenues when you’ve got high occupancy rates?

Raising the rates seems obvious, but it could backfire at times.

So, test. Develop interesting tests and play with the market.

How do you raise your appeal to higher-rated segments?

Not a lot of hotels know where their market position is. Define and position yourself.

Ride the coattails of partner brands that have already spent lots of resources establishing themselves.

Where guests go to complain online

hotel-twitter-rantKristy and her husband were not happy with their recent stay at a Utah Comfort Inn. A lack of daily room cleaning and the busload of noisy teenagers staying on the floor above (“like sleeping under a herd of elephants”), caused her to complain to hotel management. Unsatisfied by a discount offer and apology letter, she tweeted about the hotel – getting the attention of Choice Hotels (the parent company).

This story was posted on the Consumerist yesterday, with most of the readers siding with the hotel in this case. Whether this person had a legitimate grievance is debatable, but the bigger issue is that guests are now taking their complaints online.

They go to Twitter

Kristy isn’t alone. A quick search on Twitter reveals hundreds of hotel complaints each day. The stream-of-consciousness format makes it very easy for guests to share what’s bothering them.

They go to their blogs

Ranting about a poor hotel experience on a blog is nothing new: there are whole blogs built around this concept.

The problem with a negative blog review is that it typically has a long shelf life – and can rank highly in search engines for your hotel’s name. This greatly increases the chance a potential guest will find it when they look for you.

Another interesting thing I’ve observed is that unhappy guests will sometimes post a complaint on a seemingly unrelated blog. For example, Wyn complained on my Hyatt Twitter Concierge story that unless the company fixes their customer service and loyalty programs, Twitter isn’t going to help. (point taken)

They go to TripAdvisor, Yelp, Qype…

Pizzeria Delfina yelp shirtOf course. You know that.

But even if you have the good humor to create staff t-shirts with 1-star reviews – like San Francisco’s Pizzeria Delfino – these negative reviews can seriously cut into your hotel’s profit.

They go to OTAs

In my experience, hotel marketers generally check guest reviews on sites like Travelocity and Orbitz less often than TripAdvisor.

Unless you monitor your reputation here as well, negative comments could fly under the radar and reduce the revenue you receive through these channels.

They go to Facebook

More and more hotels are moving to set up a presence on Facebook, and as with Twitter, the convenience makes it easy for people to share a bad experience with hundreds of their friends.

They go elsewhere

People can post complaints anywhere on the web: YouTube, Flickr, forums – the possibilities are endless. The reality is that the internet empowers consumers like never before. Anyone can say anything – with a megaphone.

It’s a control freak’s nightmare, but shouldn’t be a huge concern to hotels that make guest satisfaction a top priority.

The lesson

Customers are quickly taking their complaints online if they don’t receive a satisfactory resolution. Neglecting to solve problems offline could really damage your reputation online.

Your Homework: Make sure you’ve set up “listening tools” to quickly catch if someone makes a comment about your business like this.

For a list of free listening tools – plus an action plan for managing your online reputation – see my article on beating negative hotel reviews.

Guestsourcing: A Practical Guide

Earlier, I defined guestsourcing as a way for hospitality companies to involve their customers in the promotional process. The rewards include:

Now, I’d like to get practical and show you how to take advantage of this concept.

It’s very important you approach this right. Michael pointed out in a recent comment:

It seems to be more genuine and effective when it isn’t forced. Beyond the effort involved, when you court users who are not familiar with social media and not quite sure how to review…it can look and feel awkward…from bad reviews, to “shill” looking reviews.

I agree completely: timing is everything.

The perfect timing

Over and over, I’ve observed the best time to ask for online participation is after you receive positive guest feedback in some form. This may seem like a no-brainer, but it works.

If you get nothing else out of this article…

The next time you receive positive feedback, ask the guest for some type of online contribution. This works like magic for getting reviews on TripAdvisor, but remember we’re discussing guestsourcing here – the art of getting media on the web.

Ask the guest if they would like to share some photos of what they liked about your hotel. Perhaps this will be on Flickr…or just attached to a TripAdvisor review. The important thing is getting the content online – where potential guests can see it.

Turn existing fans into online participants

Earlier this week I talked with a hotel that had a very strong offline fan base, but just recently began social media marketing. With just a little bit of promotion, these fans quickly started participating and submitting their own content. It’s especially important to leverage your existing reputation if you’re new to this.

Listen and reach out

Be aware when prominent bloggers and media producers are visiting your area. Roger Smith did that with Chris Brogan. You can do that by monitoring Twitter and other channels to see who is visiting your area.

Reach out to media producers!

From a marketing perspective, these are among your most valuable guests.

Create a contact point

Designate a social media contact person to provide help and access. Make it very easy for people to get in touch with them: by phone, email, Twitter, etc.

Guestsourcing Photos and Videos

Guestsourcing photos

Build a Flickr group to serve as a central collection point for photos: both for contributors and for viewers.

Showcase the best guest photos on your website, like Sunriver Resort. Reward creativity with attention.

Actively solicit new submissions on your site, and in your Flickr group.

Provide a standardized tag – yourhotelname – to make discovery easier.

With video, you may want to note what Omni Hotels is doing. As part of their Omni Flips for Summer package, guests are loaned a Flip Video camcorder for the duration of their stay. A “Summer Fun Counselor” helps guests process and upload their videos.

Encouraging blog reviews

There are many bloggers that exclusively write hotel reviews – either professionally or as a hobby. You want to treat your visiting bloggers like royalty, because they have the ability to sway online perceptions. (Which I say without bias, because I’m not a hotel review blogger…)

I recommend putting together a special blogger’s package. This can include:

  • A hotel fact sheet (like you would use with the press)
  • The background story on the hotel
  • Interview access to the owner or general manager (as appropriate)
  • High-resolution hotel photos
  • A neighborhood guide (including the best cafes with wifi!)
  • …and of course free internet access to write about you

Create a separate page to promote this

You may want to create a separate page on your website for visiting photographers and bloggers. Having links and suggestions all in one place provides easy access to all the information above.

There are no rules

You need to use your intuition on what is appropriate for your hotel and each situation. Hopefully this guide will give you some ideas, but in the end you need to…

Go out there and experiment!

Photo credits: Youssry, jenny downing