5 Scary Topics for your Next Hotel Strategy Meeting
By Lily Mockerman, Co-Founder of ThinkUp Enterprises and CEO of partner company Total Customized Revenue Management (TCRM)
The absolute best Hotel Strategy Meetings are many things - engaging, animated, results-oriented, productive, decisive, relevant, and maybe even enjoyable. We like to say that this meeting should be the single most important hour of the week for strategy and decision-making.
Because the world is somewhat scary right now, especially in the hotel business. Some would choose uncomfortable, uncertain, unnerving, or jarring.
If this meeting is meant to be our most valuable, shouldn't we face these realities together, head-on?
Hopefully, this is not too frightening! Sometimes executive teams are reluctant to discuss reviews and ratings in this meeting format, but I feel the opposite to be true. No one would argue that there is a direct correlation between guest reviews and price positioning. What better opportunity to discuss this?
For all sites:
- Review current scores
- Review changes from the prior week
- Confirm management responses
- Address guest issues
Ok, this one can definitely send a shiver down your spine, depending on your market.
Here are a few things to be sure to address:
- Make sure you're looking at all of your competitors, not just those on your STR comp set. Check Expedia and Google's "Similar Hotels Nearby". Filter for your hotel's star rating and neighborhood. OTA extranets also provide information on which properties booked guests that had also searched your property.
- You don't need to be a follower. If you find yourself always focusing on one or two properties and trying to stay within $x of their rates - STOP. Ask yourself, "What is the GUEST looking for?" The guest is certainly not looking ONLY at your price position with another hotel.
- Look at what more successful competitors do over time. Learn patterns from data in your STR and Demand 360. What are you missing out on? Are you consistently losing in occupancy on Mondays and Thursdays? What channels are your competitors booking on those dates, and what is their lead time and ADR?
Without a doubt, this is fear-provoking. Market mix is going to be much different than it was in 2019, and even different from January and February of 2020. Some segments have flattened out entirely - citywide convention business, cruise-related rooms, international group and transient business, and of course, business travel - just to name a few.
Many hotels are starting from scratch with their segmentation, but that doesn't mean that you can't find the most optimal business mix. Are you familiar with which of your channels is the most profitable, which ones result in the most ancillary revenue - using actual data, not anecdotes or intuition? Are there segments which had previously been overlooked or discouraged that you can investigate now?
Right now, the voice channel is incredibly relevant as a resource for guests to feel comfortable that they have the most accurate and updated information on your property. They don't necessarily trust that the information on the website is up-to-the-minute, given how quickly things change. How can you improve the voice experience?
Right now, we are living in an alarmingly short booking window. In some cases, weekend same-day business, rates and pickup should be reviewed hourly to maximize. For transient business farther out, even for traditionally high-demand dates, pace is often very slow.
This makes me think of a sign on Colorado's Eastbound I-70 coming into the Denver metro area, which has a very steep grade. It says, "Trucks, Don't Be Fooled!"
Don't be fooled into thinking that the only thing we should be talking about in these meetings is the next few weeks, even if current demand only extends that far. Hotels should still focus on having a rolling 12 months of availability and day-by-day strategy in place.
Manage your Transient offers proactively, ensure holidays and events are identified, and strategies are in place. Plan now for RFPs. Start the analysis, ROI on consortia, and discussion on all accounts.
Pricing & Profit
Current topics in hotel industry publications center around staying away from panic pricing or heavy discounting in hopes of stimulating demand. Right now, price is most often not the barrier to travel or hotel stays. It is, of course, health and safety concerns, government mandates, and even unemployment impact.
In your Strategy Meetings, hold each other accountable for ensuring that your price positioning is not just reactionary, and that you are not just trading down rate. Those guests probably would have paid the price you had in place before discounting.
Profitability is always a focus. Right now, however, every little piece of the puzzle matters just a little bit more.
How to bring these topics into your weekly meetings
Always talk ROI. Hopefully, marketing is a part of your Strategy Meetings. Consequently, any decisions on messaging, email blasts, package offerings, etc. should be followed up with an ROI result, then compared to past offers/strategies. Repeat what works best.
Upsell and cross-sell. Create an official plan for upselling and cross-selling pre-arrival, during arrival, and mid-stay. Document the communication process and measure the results, bringing them to the meeting.
There is a real opportunity to maximize with the guests that are staying with you right now. There are fewer options for them off-property, so making it easy for them to stay longer and enjoy the amenities of your hotel is a win for them as well.
Optimize your data. How is this related to profit?
- We don't always get email addresses from bookings that come through third parties. This means we can't communicate directly with a guest that has stayed at our hotels. It's scary to think about bringing a list of all third-party guests to a Strategy Meeting and measuring what percentage of them have an email attached to them; but perhaps that awareness might lead to an improved process to capture that information.
- Unreliable source/segment code production data. When we talk about profitability, we want to know the net ADR for each channel that books the hotel and make distribution decisions based on those numbers. If the data is inaccurate or unreliable, we're not able to determine an informed channel or segment strategy.
Bringing in these topics (and data!) to your Strategy Meetings might feel a little uncomfortable at times, but facing these realities together is what will be of most benefit to the hotel.