Carol Verret Consulting 
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4 Post Recession Shifts  in the
Hotel Sales Environment

What You Need to Know for Success in 2010

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November 18, 2009 - The recovery is coming – not a huge surge in demand but a slow manageable increase in demand.  Rates are another story.   There are four subtle but important changes in the sales environment that evolved during the recession and that impact hotel sales processes.  Hotel sales offices and marketing departments need to understand these subtle paradigm shifts in order to maximize the opportunities in the fragile recovery ahead. 

The GDP slipped into positive territory in Q3 09 at a 3.5% growth rate.  GDP is expected to increase at rates close to 3% for Q4 09 and Q1 and Q2 1020 with the last two quarters of the year posting GDP growth of 3.0% according to USAToday on November 2. 

The hotel industry is not so fortunate.  While demand increases are anticipated in leisure and the corporate segment the percentage of demand increases will be moderated by the influx of new supply in any given market.  In other words, the recovery in demand will be spotty with stronger growth in those markets where there is the least new supply. (PWC, HotelNewsNow, 11/09/09)

Social Networks:   In the past year since the recession took a nose dive off the cliff, social networks have become more embedded in sales process.   However, there are few guidelines on how to maximize engagement on these networks in the sales process.  Few independent hotels and management companies have developed policies and procedures in order to ensure that their teams are using them efficiently, not only for connecting to potential clients, but in their qualifying processes for companies and contacts.   Hotel marketers need to begin planning for how they are going to handle Twitter as Tweets will shortly be appearing in Search Engine results on Bing and Google.  Example: Ben Bethel, owner operator of the Clarendon Hotel in Phoenix has been using social media for some time to promote his independent hotel.  “For The Clarendon Hotel, I currently use Twitter, which also automatically updates my FaceBook account every time I tweet.  I keep everything on a personal level - it comes straight from me as "Ben Bethel" instead of an account under The Clarendon. … When promoting The Clarendon's rooftop bar, pool area, upcoming events or rooms specials, I always try to make sure I'm being useful to the reader by including something newsworthy or pertinent to the area, and not just create something that will be considered spam.”

Prospecting or New Business Development.    The verticals have changed in relation to who has the money!   Which industries are emerging as the new economy leaders as the country comes out of the recession – those are the ones that hotels need to pursue.  Those verticals that received stimulus finds are the hot prospects now!   For example, oil and gas are out –alternative energy is in!  The ways that we locate companies and contacts have changed – Google tools incorporating Advanced Search, Google maps,   Google Earth make prospecting faster and more efficient!  Using social networks to log onto company’s profiles for info and locating key contacts that may be one or two degrees of separation away from you can assist in getting introduced or referred to the contacts you want to know.   Example:  a hip hotel in a major metro area came way from a recent web cast with a new prospect from the example we used to illustrate this prospecting process – that’s ‘take away’!

Online Group Platforms and the OTAs:   It is a mistake to measure the effectiveness of online platforms and OTAs only in terms of leads and bookings.    We have always discussed the ‘electronic billboard’ effect but have made very little effort to measure its impact on direct leads to the hotel or to reservation increases on the hotel’s web site.    Finally someone has.  Expedia, love it or hate it, has always maintained that it’s platform is used as a travel search engine by consumers, many of whom then go direct to the hotel’s web site.  Expedia has even gone so far as to say that for every reservation made on it’s web site, another is made on the hotel’s web site.  Cornell University conducted a study on Expedia’s ‘electronic billboard’ effect.  While the one to one ratio was not demonstrated the results were significant.  According to the study, the hotels saw a boost in reservations ranging from 7.5% to as much as 26% for the indie hotel when they were listed on Expedia vs. when they were dark. (Cornell Study, Hotel Marketing.com, 11/12/09).  Example:  Ask a group lead how they have heard about the hotel – you may be surprised by the platforms they are shopping! 

Contrarian Strategies for Corporate Business:  A few months ago we wrote about ‘turning over small stones’ for big results.   The large RFP accounts have been brutal in their negotiations this year and are producing less and less as their travelers go ‘rogue’ in booking hotels outside the agreement on Priceline and other sites – all with the tacit approval of the company as long as it saves money!  Many hotels are feeling ‘held for ransom’ as the RFPs come back every few months to renegotiate as rates drop.   Enough!  There was a recent study conducted by Forrester Research for Best Western that identified the opportunities in the small business space.  “According to Forrester's Consumer Technographics North American Q1 2009 travel online study, a majority (56 percent) of U.S. business travelers are unmanaged” (Best Western/Forrester Research Study, Hotel Resource, 08/25/09) .   Consider developing a small and medium sized business strategy to identify and court the small businesses in your market.  They are less rate sensitive and in many cases, grateful to have a hotel that acknowledges them and appreciates their business.  Example:  Small select serve property, 150 rooms, with no major demand generators within 3 miles of the hotel.  Called on every small business in their market and rose to the top of their comp set in market share penetration within six months by building a business based on companies that generated between 10-20 rooms per month! 


Building these four initiatives into your sales and marketing efforts can propel you to more market share in 2010 – remember ‘It’s not the big that eat the small –it’s the fast that eat the slow”! (Jennings & Houghton, 2004) 

Need some assistance in identifying the ‘small stones’ in your sales and revenue management strategies?  Email us at carol@carolverret.com for more info.  We will review your reports absolutely free and if we don’t think we can help you we will tell you!

Carol Verret is an author, speaker and trainer to the hospitality industry in the areas of sales and marketing, revenue management and the guest experience.  Log onto the web site www.carolverret.net, the blog www.hotelsalesblog.com   or find her on LinkedIn and follow her on Twitter. 


 
Contact:
Carol Verret, Consulting and Training
Carol Verret
5910 S. University #C-18, PMB 374
Greenwood Village, CO 80121
Telephone: (303) 618-4065
carol@carolverret.com
Web Site: http://www.carolverret.com/
Email: carol@carolverret.com
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Also See: The 20% Solution to Increased Market Share and Revenue / Carol Verret / October 2009
Managing Revenue by Market Segment – The Recovery Challenge for Sales and Revenue Managers / Carol Verret / September 2009
The Mindset of the 2010 Business Plan – Survival Mode or Recovery Mode? / Carol Verret / August 2009
The New 'Tipping Points' in the Planners Decision Process - You May be Surprised! / Carol Verret / June 2009
The New Normal – What Does the New Normal Look Like for Hotel Sales and Revenue Management / Carol Verret / May 2009
The New Hotel Sales and Revenue Management Metrics - This Could save Your Job! / Carol Verret / April 2009
Back to Hotel Sales Basics: The Basics Have Changed Big Time!  / Carol verret / March 2009
Stimulate Hotel Revenue -- The Economic Stimulus Package Opportunities / Carol Verret / February 2009
2009 The Game Changer for Innovation in Hotel Sales Processes / Carol Verret / January 2009
Contrarian Strategies for Hotel Sales Departments to Thrive in an Economic Downturn / Carol Verret / December 2008
‘Selling Into’ a Bad Economy – Overcoming Fear and Stealing Share / Carol Verret / October 2008
Habits of Highly Successful Hotel Sales People – Accelerated Sense of Urgency / Carol Verret / September 2008
The Challenges and Opportunities for Independent and Boutique Hotels in a Difficult Economy / Carol Verret / August 2008
The Science of Hotel Sales* – The Benchmarking Imperative for Success in a Difficult Economy / Carol Verret / July 2008
Marketing & Revenue Management Plan 2009 - Succeeding in a Difficult Year / Carol Verret / July 2008
Tactics to Drive Business in a ‘Not So Hot’ Summer / Carol Verret / May 2008
All Marketers Are Liars - Web 2.0 Strategies for Hotel Sales and Marketing / Carol Verret / April 2008
Contingency Hotel Revenue Management Strategies 'I Will not Cut Prices'/ Carol Verret / March 2008
The Contingency Hotel Sales and Marketing Plan - Hope for the Best, Plan for the Worst / Carol Verret / February 2008
Change is the Buzz – Rebooting Hotel Sales Activity at the Property Level / Carol Verret / January 2008
Habits of Highly Successful Revenue Managers Ramped Up for 2008 / Carol Verret / November 2007
Five Tips to Improving Hotel Customer Service with User Generated Reviews / Carol Verret / October 2007
Habits of Highly Successful Hotel Sales People – A Seismic Shift in 2008! / Carol Verret / September 2007
GMs – How User Generated Review Sites Can Make you a Better Manager! / Carol Verret / September 2007
Web 2.0 and Hotel Sales Strategies for '08; What Are Your Clients Saying About You? / Carol Verret / August 2007
“It’s not the big that eat the small, it’s the fast that eat the slow” -- Five Revenue Management Tactics for Independent Hotels / Carol Verett / June 2007
Developing New Hotel Business Using Client DNA / Carol Verret / May 2007
The Jigsaw Puzzle – The Fit of the Revenue Management and Internet Group Sales Pieces / Carol Verret / April 2007
Client DNA - The Gold Standard for New Business Development / Carol Verret / March 2007
The 'I Hate Cold Calls' Web Cast - The New Paradigm of Sales! / Carol Verret / February 2007
Hate Cold Calls? - Discover the New Paradigm of Hotel Sales / Carol Verret / January 2007
Issues in Hotel Sales Training - Metics for Success / Carol Verret / December 2006
Is the Party Over?; The Challenge of Decreasing Hotel Room Demand / Carol Verret / October 2006
The Habits of Highly Successful Hotel Sales People Ramp Up for 2006! / Carol Verret / September 2006
Identifying the WIIFM Factor – The Essential of Hotel Sales Success / Carol Verret / August 2006
Revenue Management for Hotel GMs – What You Don’t Know Can Jump Up and Bite You!/ Carol Verret / July 2006
Feeding the Revenue Elephant; Hotel Revenue Management / Summer 2006
The "Tipping Point" - Identifying the Touch Points in Hotel Sales / Carol Verret / May 2006
The "Tipping Point" - Touch Points Make a Difference in Customer Service Training / Carol Verret / April 2006
Selling Up! Taking Group Room Revenue to a New Level / Carol Verret / February 2006
Revenue Management 2006; The Risks and Rewards / Carol Verret /January 2006 
Revenue Management and Group Sales - The Partnership Not the Disconnect / Carol Verret / November 2005
Habits of Highly Successful Hotel Sales People / Carol Verret / September 2005
Triple Witching Hour - The Marketing Plan, Revenue Management Strategy and RFPs for '06 / Carol Verret / August 2005
"Smile" is a Learned Behavior - Creating a Culture of Customer Service / Carol Verret / July 2005
Revenue Management Systems -- Considerations for Evaluation / Carol Verret / June 2005
Disconnect -- Aligning the Revenue Management and Sales Strategies / Carol Verret / May 2005
Independent Hotels & Resorts; Ride the Wave or Float with the Tide? / Carol Verret / March 2005
Hospitality Sales Training Companies Reach Across the Competitive Playing Field to Combine Live Seminar Expertise with  the Convenience of the Internet / Carol Verret / January 2005
Revenue Management - The Challenge for Hotel Sales / Carol Verret / January 2005
Hotel Sales Departments -- Issues in Processes and Functionality / Carol Verret / November 2004
The GM'S Role in Revenue Management / Carol Verret / October 2004
Transforming the Hotel Sales Organization; Alignment with the New Realities of Sales / Carol Verret / August 2004
The Revenue Management Strategy - The Pre-Plan Marketing Plan / Carol Verret / July 2004
Hotel Revenue Management this Summer - a Game of Skill, Art and Most of All Nerves / Carol Verett / May 2004
What Do Meeting Planners Want? Hotel Sales Managers Want to Know! / Carol Verret / May 2004
Revenue Management -- The Integration of Revenue Drivers / Carol Verret / March 2004
CYBER SALES -- Hotel Sales in an Internet World is the New Reality / Carol Verret / February 2004
The New Realities of Hotel Sales - Focus on Revenue Generation / Carol Verret / January 2004
Hotel Sales -- Innovation in the Face of Limitations / Carol Verret / November 2003
The Good News & the Bad News; Improving Economy = New Hotel Development / Carol Verret / October 2003
Leadership - General Managers Managing the Sales Process / Carol Verret  / October 2003
When the Crystal Ball is Cloudy; Marketing Plans for 2004 / Carol Verret / July 2003
Partnership of Sales and Technology; Using Tech Tools to "Sell" the Hotels / Carol Verret  / July 2003
Back to the Basics? The Basics of Hotel Sales Have Changed! / May 2003
Creating Sales "HUNTERS": The Skill Sets Required in the New Hotel Sales Environment / April 2003
Heightened Security Requires New Strategies in Hotels Sales / Carol Verret Consulting and Training / Mar 2003
Revenue Recovery - Building The ‘A’ Team in Sales / Carol Verret / January 2003
Contingency Marketing Plan – War In Iraq! / Carol Verret / November 2002
Playing the Rate Game - Positioning -- Positioning -- Positioning! / Carol Verret / October 2002
The Rate Game - Playing to Win / Carol Verret / October 2002
The Challenge of Marketing Independent Boutique Hotels / Carol Verett / August 2002
Hotel Sales in a Limited Service Environment - The Rules Have Changed / Carol Verett / August 2002
The General Manager’s Role in Sales -Chief Marketing Officer of the Hotel / Carol Verret / April 2002
100% Market Share Penetration is Not Good Enough / Carol Verett / January 2002
The Key to REVPAR Recovery –  New Business Development / Carol Verett / December  2001
Trash the 2002 Marketing Plan - And Just Start Over / Carol Verett / September 2001
How to Use Consultants Effectively –  A View From the Other Side  / Carol Verret / August 2001
How Soft Is Your Hotel's Economic Landing?  / Carol Verret / Aprl 2001
The ‘Value Proposition’: Marketing Yourself to Prospective Employees / Carol Verret / January 2001
Generation Y:  Motivating and Training a New Generation of Employees / Carol Verret / November  2000
Why Customer Service Seminars Don't Work / Carol Verret / October 2000
Creating a Culture of Customer Service / Carol Verret Consulting and Training / Sept 2000 
FAT, DUMB AND HAPPY – The Seasonal Boom and  Bust Cycle / Carol Verret / August 2000
Surf's Up - Ride the Wave or Miss the Boat -The Effective Use of Technology in Hotel Sales / Carol Verret / July 2000 
Measuring Effectiveness of  Hotel Sales Departments / Carol Verret / June 2000
Hotel Sales Training - The Need for Immediate Results / Carol Verret/ May 2000



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