Hotel Sales Incentive Plans: Friend or Foe?

By Brenda Fields Founder, Fields & Company | May 19, 2010

Ensuring that the sales team is highly motivated and productive is an ongoing process, regardless of the size or type of property. There are many ways to ensure success, one of which is incentive plans. But, to achieve the desired results, it is important to know that when it comes to incentive plans, one size does not fit all. Effective incentive plans take on many shapes and sizes, depending on the needs of the property and the business mix of the property. And as a note, an incentive plan does not replace skilled sales managers working in an organized, professional, and strategic manner. It should be the icing on the cake to ensure that good sales people are going the extra distance and have added motivation to prospect, overcome customer objections, and effectively handle product or service deficiencies.

This article addresses key components to consider in customizing an effective plan which motivates and rewards the sales manager and/or sales team and at the same time, produces the optimal financial results for the property.

Key Points to Consider and Questions to Address:

A hotel room is a perishable product

Unlike other products, a hotel room has a very short shelf life. What we don't sell today is forever gone. Conversely, if demand exceeds our inventory, we cannot produce more rooms to sell. Therefore, the key is to sell effectively on a daily basis. Another factor is that hotel rooms have varying values depending on demand patterns. The same room can sell for widely different rates depending on the day of week and season. Selling rooms in peak season usually is a function of "taking orders" rather than excellent sales skills, which is required in persuading a group to book your property over another one in a buyer's market.

An effective plan is one which motivates and rewards the individual and or sales team for great achievement and at the same time, produces the best financial results for the hotel. Rewarding a team to book business which actually displaces revenues happens when a basic understanding of your business goals has not taken place or the strategic plan was not well founded. So, before going forward with a plan, it is important to assess the following for your hotel.

Coming up in January 2018...

Mobile Technology: Relentless Innovation

Technology has become a crucial component in attracting and retaining hotel guests, and the need to enhance a guest’s technology experience is driving a relentless pace of innovation. To meet and exceed guest expectations, 54% of hotels will spend more on technology in 2018, and mobile solutions in particular will top the list of capital investments. Many hotels are integrating mobile booking, mobile keys, mobile payments and mobile check-in into their operations. Other hotels are emphasizing the in-room experience, boosting bandwidth and upgrading flat screen TVs to more easily interface with guest mobile devices. And though not yet mainstream, there are many exciting technology developments on the near horizon. The Internet of Things (loT) is taking form in some places, and can be found in guest room control systems, voice activation systems, and in wearable sensors that can be used for access and payment options. Virtual reality headsets are available at some hotels so guests can enjoy virtual trips to exotic locations or if off-property, preview conference facilities and guest rooms. How long will it be before a hotel employs a fleet of robots for room service, or utilizes a hologram as a concierge, or installs gesture-controlled walls that feature interactive digital displays? Some hotels are already using augmented reality for translation services, or interactive wall maps, or even virtual décor. This pace of innovation is challenging property owners and brands to stay on top of the latest technology trends while still addressing current projects. The January Hotel Business Review will explore what some hotels are doing to maximize their opportunities in the mobile technology space.