Your sales and marketing team works
diligently on bringing business to your hotel. But what if you’re not seeing the
RevPAR (revenue per available room) that you need?
Check that your team is actively researching
the competition and leveraging the results in profitable ways. Here are some tips
on how to make the most of the information out there.
Know your
competitive set
Identify your competitors. Which of the
hotels in your area are you competing with over the same sources of demand?
Consider factors such as location, quality, and average daily rate.[1]
Evaluate
your competitors
Once you’ve identified your primary
competitors, perform a SWOT test (strengths, weaknesses, opportunities, and
threats) on them.
David M. Brudney, a hospitality marketing consultant
based in Carlsbad, California, explains that when done correctly, a SWOT test
will “expose weaknesses and vulnerabilities that can be invaluable when bidding
against competitors.”
He suggests using a professional shopping
service to help evaluate other sales managers’ strengths, weaknesses, and
negotiating skills.
Inform
your pricing strategies
Reducing rates drastically to fill rooms—called
“sacrificing rate”—is one of the worst mistakes a hotel can make when it comes
to trying to increase occupancy, says Brudney.
A far better pricing strategy is, if you are
aware that you and a competitor often bid for the same pieces of business, to
research their pricing strategies and availability.
One way to achieve this, says Brudney, is
to call the other hotel purporting to be a meeting planner and ask about room
rates over various dates.
“If you know the other hotel in question is
likely to be full over those dates…you can be more hard-nosed about quoting a
higher rate as chances are the other hotel…may not even bid on that piece of
business because they will no doubt run full.”
Encourage and empower your team
The best way to motivate your sales and marketing team to incorporate competition research into their work is to lead by example, says Brudney.
He recommends demonstrating how research is
done, pointing out best practices, and, of course, highlighting the positive
results that come from leveraging what you know about your competition.
Hire
an expert
Most competition research can be done
internally, and often hotel brands can offer support. But if you’re suffering
from a lack of internal expertise and resources, it may be time to hire a
consultant.
The advantage of having a good hotel
marketing consultant working for you, says Brudney, is that they know the
standard of care.
“In my role as a consultant…I bring a
wealth of knowledge –including sales and marketing best practices, tips on
improving performance…motivating and mentoring sales teams—as a result of my
years in the business.”Brudney advises managers to be diligent in vetting consultants, suggesting that they check for solid references, examples of previous work, and ROI (returns on investment) for their previous clients.
[1] HVS, “How to Identify a Hotel Competitive Set for a Hotel Market
Study,” Canadian Monthly Lodging Outlook,
October 2012.
