June 2003 - Silver Cloud Inns faced a challenge: most of their properties serve the Puget Sound and Portland area corporate high tech market, a business segment hit hard in the economic downturn. The company�s management team analyzed their markets and decided that, by increasing their guests� average length of stay, they could compensate for the general decline in business travel; but how could they make that happen? �About 70 percent of Silver Cloud Inns� business
is corporate, and we compete against limited service, midscale chain properties
in our area,� said Brian Zuber, COO of Silver Cloud Inns, a privately held,
Bellevue, Washington-based hotel company. �At the beginning of the
year, we made a decision to focus on increasing our average length of stay
to boost revenue; and we wanted to improve our availability for guests
staying longer than a typical two or three night stay. We turned
our attention to our GDS channels and worked with our channel reservation
sales partner, VIP International, to fine-tune how we were working through
travel agent consortia and negotiated rates. With their help, our
January over January GDS numbers were up 22%.�
 Silver Cloud Inns, founded in 1980 as a small family-owned company, has grown steadily to become a strong midscale chain with 11 properties and three under development. Most Silver Clouds Inns are at the upscale end of the limited service segment that appeals to traveling professionals and, increasingly, to leisure guests. �Although most of our hotels are limited service, our direction is toward developing high profile properties, like our new Capitol Hill Seattle Hotel, that appeal to a higher ADR clientele. We are unique in that we have been able to build market share rapidly and grow in the slow economy,� explained Zuber. Silver Cloud Inns� revenue manager developed and coordinated a strategy with VIP International to increase average length of stay and raise the average daily rate. VIP focuses on driving revenue for its partners by generating room reservations, optimizing rates and co-developing selling and positioning strategies with their clients. Brian Zuber explained, �We began working more closely with our Revenue Manager at VIP to put together the GDS and travel agent consortia components of our strategy, which is to maximize guest stays and increase RevPAR. She closely monitors our Internet sales activity and analyzes our monthly productivity reports highlighting recent reservation trends. With her hands-on help, our ADR jumped 14 percent for Internet channel bookings in January and February over 2002 numbers.� For the first quarter of 2003, Silver Cloud Inns
realized a 20 percent increase in average length of stay in GDS bookings
for the same period in 2002 resulting from a sales plan that cut back on
hard availability closes, and rewarded guests who stayed longer with lower
weekly rates. Working with VIP, Silver Cloud Inns learned they often
had weeks with five nights of 60 percent occupancy, and two nights of 100
percent. When historical reporting revealed that a predictable number
of cancellations occurred on the sold out nights, the company began aggressively
selling across the sell-outs for longer-stay reservations.
Seven years ago Silver Cloud Inns had no GDS presence at all, and was limited in where it could go with travel agents in the corporate market. �We brought our channel marketing provider on board to increase exposure to travel agents and corporate markets. Their team supported our growth as we slowly rolled properties on. Over the last two years we are growing same-property sales by working with corporate accounts through our GDS channel via marketing preferred rates. I�m impressed with VIP�s ability to handle 20 consortia programs and streamline that entire process; and the individual attention we receive from their client reps. It feels like we have our own GDS revenue manager working for us in Calgary.� |
