Mr. Gilbert

Sales & Marketing

The P.O.W.E.R.R. of Sales & Marketing

By Robert Gilbert, President & CEO, Hospitality Sales & Marketing Association Int. (HSMAI)

If demand in the U.S. will be down 5.5% this year, then why will average daily rates be down nearly 10%? Have our results become a byproduct of our own forecasting doom and gloom? Rates are down in most markets because of the panic of a few hotels, which started a downward spiral of discounting that wasn't even necessary to accommodate the existing demand. Other hotels in these markets have followed suit and consumers benefit from the industry panic. Come on, hotel industry, take control! Are we to quick to blame the economy for all of our problems?

Sales and marketing teams have long been blamed for not capturing the business when times are bad and the economy is quick to be credited during the good times. Whether you are an owner, operator, or sales and marketing professional, tapping into the P.O.W.E.R.R. of sales and marketing will help you recover much faster from the current recession than your competitors -certainly long before the hotels that may have started the rate war in your market in the first place. Here's where the P.O.W.E.R.R. is:

P - People knowledge

The customer and consumer information is king. Sales teams are on the front lines of this valuable conduit of information on specific trends and buying information from corporations and groups. The outlook of your current and prospective customers is available if your sales and marketing teams are asking via sales calls and customer focus groups. Leverage this P.O.W.E.R.R. Sales and marketing professionals have an inherent responsibility to share this information and manage up. Some of the greatest innovations in our industry are a result of customer information transformed into new product and services.

Companies that have invested and continue to invest in targeted direct sales, database marketing and mining, and customer intelligence will lead the way out of this recession.

O - Online

Ten years ago few dreamed of what the internet would or could do for the hospitality and travel industry. Web 1.0 built electronic brochures. Web 2.0 evolved from online brochures to hotel booking engines and brand.com focus. Web 2.0 also brought us distribution far beyond the traditional global distribution systems we had taken for granted. Web 3.0 represented another generation of intermediaries, search capabilities, and communities of customers who share their hotel experiences online. In order to be successful today you must ensure your online strategies are current. The competencies of revenue management and internet marketing are converging. You must have search engine optimization and marketing systems in place. And you must be engaging with the customer in their online channels and communities. Social media and social networks today provide instant channels of communication - with good things and bad - about your product or service. Without a comprehensive online strategy your business market share will continue to erode.

W - Wall Street

The pressure for quarterly profits and public ownership has transformed much of the hotel industry. Authentic and genuine hospitality is a rare experience today. Relationships are still important but in recent years they have been suppressed by the pressure for profit performance. What does this mean for the sales and marketing discipline and the sales and marketing professional? You must have the business acumen necessary to understand the objective of ownership and the financial competence to present your cases. Sales and marketing budgets need to be built with a confident return on investment mentality. Clearly, the "doing what we have always done" and "we know that only half of marketing works, we just don't know which half" doesn't cut it anymore. Today part of the P.O.W.E.R.R. of sales and marketing is to present confident business plans and budget expenditures that can be justified with a tangible or target ROI associated with specific strategies. If you can't talk the lingo with upper management or ownership, you're toast.

Sales and marketing professionals must be exposed to and understand the basics of hotel finance and operations to be able to be part of a strategic team that can positively impact the hotel. Training and resources are available today to do this.

E - Enthusiasm

Sales and marketing professionals must unlock the P.O.W.E.R.R. of enthusiasm. This unlocks the energy, creativity, and innovation critical for success in any time - especially during the down economic cycles like the one we're in now. Enthusiasm must be created internally and externally; in the eyes of the sales team, hotel employees, and upper management and in the eyes of potential customers and target markets. Public relations is a strategy that is frequently under-utilized in our industry that can generate great results and publicity.

There is no doubt that enthusiasm, creativity and innovation will drive the success stories that we will witness during 2009.

R - Relationships

Relationships still drive revenue. Whether it's the relationship between a bellman and a frequent business traveler to your hotel or the relationship between a sales manager and a meeting planner, the personal touch and a genuine relationship can never be replaced or automated. Services and processes and distribution channels can be leveraged and improved by technology but the ultimate decision to buy or return will always be made by a person. Sales and marketing professionals must continue to sell and cultivate relationships. Hotel companies must continue to invest in their employees in the form of training and customer service enhancements. Relationships are also the beginning of partnerships and marketing cooperatives that can bring you more business in a variety of ways. Without relationships hotels will become commodities. And no one wants to stay at a commodity-type hotel.

Hotels must invest in the relationships that are going to bring them the business of the future.

R - Revenue Management

So by now you want to know if I can spell, right? Why the extra "R" in P.O.W.E.R.R? Because. Revenue Management has to be included in the common denominators for success today. If marketing is defined as demand generation, sales as demand capture, then revenue management must be the management of that demand. This science has been around for decades in the hotel industry. But it's only been in the last decade that this evolving discipline has had such a profound positive impact on the optimization of revenue. By definition revenue management is "maximizing rate in high demand times and maximizing occupancy in low demand times." And revenue management goes far behind just rooms revenue optimization; it has to be leveraged to all revenue centers. But, revenue management has to be fully integrated into your total operations, marketing, sales, and pricing strategies.

Now is the time to make sure your revenue management practices are in balance with the other "R" in P.O.W.E.R.R. - the relationships with your customers.

So what do you do with all this P.O.W.E.R.R.? As you search for the strategies that will get you through the short term and longer term operation of your business, harness this P.O.W.E.R.R. by making sure that you are investing in the right places. It has been proven time and time again, in this industry and outside of this industry, that those who invest in sales and marketing are the first to recover and will recover the fastest. If you want to be on the front of the recovery curve - and lead your competitors by a wide margin - strategize with your team to ensure you have all the P.O.W.E.R.R. in the right places. Do you have the right people in the right positions with the right budget and resources to achieve the success you desire to have? That is the question only you can answer.

For the last decade, Bob Gilbert has been guiding HSMAI through an exciting period of change. At the helm of what has become the definitive hospitality and travel marketing association in the world, he has made tremendous strides and enjoyed great successes as he’s worked to establish HSMAI as the industry champion in identifying and communicating trends in the hospitality industry. Prior to joining HSMAI in 1995 (in an executive capacity), Mr. Gilbert was the vice president of marketing for Richfield Hospitality Services, Inc., at the time, the largest hotel management company in the world. Mr. Gilbert can be contacted at 703-506-3280 or bgilbert@hsmai.org Extended Bio...

HotelExecutive.com retains the copyright to the articles published in the Hotel Business Review. Articles cannot be republished without prior written consent by HotelExecutive.com.