From spoonsful to ladlesful
With the meritorious desire to strengthen their presence among the public and clientele, hoteliers made brand promotion a priority.
By Georges Panayotis, President & CEO - MKG Group
They mobilized sometimes disproportionate marketing teams to give body to renewed discourse on values, services, and very generous offers. You asked for it, you got it all…. All-inclusive, all-new, more beautiful… all to stimulate occupancy at properties! But has the hotel product itself truly evolved? Have we not mostly tried to cover up a lack of change and concept renewal with an accumulation of offers that appear to be attractive but that are actually very costly? The unfurling of new concepts within already mature networks takes increasing amounts of time, and customers no longer understand and no longer accept such disparity within a single brand for several years. Budgets have been sacrificed to marketing when they should have been allocated to Capex. Never has a cataplasm on a wooden leg helped a person run faster, further, or better. If all management decisions rely on choices and priorities, it would be time for the pendulum to swing back to the product and concept and move away from appearances alone regardless how pretty they may be.
Undoubtedly because they are even more sensitive to the importance of how a product is perceived, unbranded hoteliers have made considerable efforts to align themselves with expectations. The new hotel classification contributed to it, although it required sacrifices and long negotiations with financial institutions. But the result is evident; the renovated urban hotel industry has regained its public. At corporate chains, franchisees have become the engines driving renewal. They are the first to mobilize around new concepts when these can bring average prices up. The same cannot be said for groups' subsidiaries which must wait before getting their share of the Capex.
The financial management of brands is faced with a dilemma: preserve margins in the short term by minimizing spending or guarantee the lifespan of the product and revenues by dedicating the necessary budget. It has often been said that hotel management needed to be dosed carefully, precisely measuring each expenditure with a coffee spoon. Using a ladle is useless if the product is not improved. The public will not be taken in and knows how to open its eyes. Through its choices, the public expresses the implacable maxim: "who you are speaks so loudly I can't hear what you're saying."