There is really only one thing that hotel people need to remember: that they are in the service business.
NB This is a viewpoint by Pamela Whitby, editor of EyeForTravel.
“We are the hospitality industry lest we forget,” says Josh Henegar, corporate revenue director for 1859 Historic Hotels, a 12-property chain, “and there are just so many opportunities to take care of people at every turn at every single touch point”.
What Henegar also believes is that all other decisions – be they marketing objectives, revenue management goals, distribution dilemmas, sales objectives and so on – must flow from this understanding.
He is, of course, talking about the innovations around total revenue management, where every guest interaction becomes an opportunity.
“Today, all the silos within the organisation have to understand that it is about managing total revenues,” he says. "However, this isn’t so easy in a world where the goals of the individual sales director may be different from the goals of the hotel owner, which are different from the goals of the management company."
A good starting point, says Angie Dobney, vice president of pricing and revenue management services for the Rainmaker Group, is to get to grips with the buying behaviours of all segments and channels of business.
“Especially group-wide! If you have not sat down with someone in sales in your organisation to understand what they do every day, you should!”
To achieve this requires a healthy and patient operations team that is willing to sit down weekly and hear each other out. Henegar believes there may even be a need to rethink bonus and incentivisation structures.
Art and RM
Choosing the right people or partners and tracking, managing and acting on data (while staying on top of all aspects of traditional revenue management such as managing rates, yielding, forecasting, visibility etc) remains crucial in today’s hotel environment.
But for Henegar, it’s also about understanding the less tangible things.
It may not be what hoteliers nor revenues managers want to hear but “there is an artistic element to some of these things that cannot be measured using a quantifiable metric”.
What he does know, however, is that simple changes can yield results. For example, take an offer that is aesthetically inadequate, with a dated font, misspelt text, poor quality images and dull colours. Then, polish it up with sharper fonts, ‘less-is-more’ text, great photos and colours that coincide with the brand offering.
Says Henegar: “How you measure this? Well yes, it’s tough, but I feel pretty confident that a quantifiable metric would be there”.
Indeed, everything from typography to images, text and colour tells a story and reinforces the brand. This has a resonance far beyond maximizing revenue on any given day, at the right time, at the right price or in the right channel.
To app or not to app
One important decision that 1859 will take soon is to choose a partner for mobile communication, something that is directly tied to the hot topic of ancillary revenues.
The group has been considering two important questions:
- Do our guests really want to download an app?
- Do they really want to opt in for SMS messaging?
For Henegar, the answer is: “kind of no but on the other hand it is a real service opportunity that will ultimately lead to ancillary revenues”.
Needless to say, there are countless solutions providers out there offering mobile communication services to hotels - Intelity, GuestU, Appy Hotel, Zonetail and Checkmate to name just a few.
But the debate over whether hotels should invest in a mobile app remains a polarising one.
According to Drew Patterson, chief executive and founder of Checkmate there can be ifs and buts. “Mobile communication is hugely important and it is something that hotels need to tackle,” he says.
However, while he certainly isn’t anti-app, Patterson believes that the app ecosystem is stacked against hotels, and in particular independents and small chains.
He cites two data points to back this backs this up:
- Nearly 80% of users time is given over to just five native apps versus around 45% to the top five websites
- When it comes to travel apps, Kayak and TripAdvisor have nearly 60,000 reviews while the biggest chains have less than 10,000 and Four Seasons and Hyatt, both highly regarded brands, less than a few hundred.
“There is a preponderance of evidence to suggest that for hotels and other products and services that have infrequent use cases it is very difficult to break through the app economy,” he says.
However, all is not lost and there are countless multichannel, real-time ways that hotels can connect with customers today - via mobile web, email, notification services such as Google Now, Apple Passbook and of, course, SMS.
Since 2007, SMS surpassed mobile voice minutes and with messaging services such as Facebook Messenger, WeChat, iMessage and WhatsApp rapidly gaining traction, communication is splintered across a range of channels.
“Having a multichannel approach allows hotels to connect with customers and engage in real-time without having to deal with the distribution and recall challenges of mobiles apps,” says Patterson.
Of course, the big chains will continue to invest in apps, but those that understand the rapidly changing communications landscape will see this as part of part of a broader multichannel strategy aimed with a strong customer service component.
1859 Historic Hotels may not have chose a path for mobile communications yet, but fully understands that there is a need to communicate with guests before, during and after their stay.
From offering upgrades prior to arrival to organising the taxi from the airport, a bucket of favourite beer in the room on arrival or help with exploring the local area, there are countless ways to drive ancillary revenues using mobile communications.
Even beacon technology to alert guests of a deal in restaurant or availability in the spa, as the customer passes by, is a possibility today. The technology today is on the cusp of allowing hotels to do so many things is there, the challenge now is which to pick and choose.
“In the end it’s a balancing act in which we are all spinning plates,” says Henegar, “while being acutely mindful about what it looks and feels like to the guest.”
NB1 This is a viewpoint by Pamela Whitby, editor of EyeForTravel. It appears here as part of Tnooz's sponsored content initiative.
To hear more from Henegar and other trend-setting travel brands on the changing face of revenue management join us in Atlanta for Smart Travel Analytics North America Feb 1-2
NB2 Image by Shutterstock.com