Mr. Heller

Sales & Marketing

Measurable Marketing Strategies for the Small Hotel Owner

By Jed Heller, President, The Providence Group

A well conceived and executed marketing strategy can be the key success factor for small hotel owners, whether the property is privately owned or a small franchise within a large chain. In today's uncertain economy, many hotel owners are rethinking their marketing strategy and re-evaluating the magnitude of their financial investment as they can't afford to waste their limited funds allocated to marketing. But, they can't survive without a marketing investment either. Logic dictates that owners must get the biggest bang for their buck with their marketing spending.

Owners need to be smarter about their marketing programs and develop a resiliency that will allow them to quickly take unproductive marketing initiatives out of play and invest heavier into those programs delivering the highest ROI.

The key to achieving marketing resiliency is to make each marketing program measurable in some way over a realistic time period. Some marketing programs are an element of longer term strategic initiatives that may take more time to measure, but milestones can be assigned along the way and results measured against each milestone to see if the program is on the right track. The success of short term marketing initiatives, such as holiday getaway promotions, can be measured immediately and should be carefully analyzed to see if the program can be better organized and implemented for the next holiday promotion.

Incorporate Measurability into the Marketing Mix

There are several tactics that can be employed to enable measurability of your marketing programs and help in determining where your marketing investment is bringing the best ROI:

• Market segmentation
• Benchmarking
• Program testing
• Marketing integration
• Tracking and analysisWhile it may not be practical to incorporate all of these elements into each marketing campaign, they are important considerations for your overall marketing strategy. Let's discuss each in more detail.

Segment Your Market

Based on your business strategy, your key customers most likely can be grouped into specific market segments. For example, some may fall into specific categories:

• Tourism
• Government groups
• Associations
• Corporate events
• Leisure groupsWhether your hotel objectives are to increase revenue from corporate programs, exploit your geographic location to leverage tourism, or closely align your hotel with various associations and events, it is important to recognize that your hotel offers a different value proposition to each group. To develop the value proposition, owners must have an in-depth understanding of the audience within each segment - know their preferences and biases - then analyze the competition in each segment to determine how best to differentiate your hotel.

A marketing message must be developed to leverage the value proposition for each specific group and remain consistent in all of your marketing initiatives, whether it be your Web presence or particular outbound direct marketing or sales initiatives.

Establish Benchmarks in Each Market Segment

The importance of establishing benchmarks is to understand where your hotel is positioned in each market segment so that you can measure progress against that benchmark with your marketing initiatives over a period of time. There are many organizations that develop hotel rankings and performance statistics that might help you see where you stand in the market segment. Owners can also initiate their own research programs to establish specific benchmarks or use third party companies who can perform economical online surveys or telesurveys to develop the statistics needed.

For example, you might find that your hotel ranks last amongst area competitors in attracting corporate functions. You can measure the effectiveness of your marketing campaign to corporate marketers by checking your ranking in 12 months to see if it has improved and make a decision to re-invest in this area based on your success.

Test Your Marketing Messages

While you may have performed your due diligence in segmenting your markets and establishing benchmarks in each, the next step is to refine your value proposition. Even the smartest marketing gurus can miss the mark and testing your messages before investing in a large campaign can dramatically improve your ROI. Here's an example. Say you are planning a large email campaign to your corporate marketing segment. Create three test messages and vary elements in each - try a different subject line, headline or photo and send the each message to a different subset of your email list. Create a specific Web landing page for the call to action for each email and track how many people opened the email, clicked on a link to your email message, and actually responded successfully to your call to action. Once you've ascertained which message worked best, refine it and send it out to your entire list.

Because email campaigns are quickly measurable, you can determine the value proposition that hits the mark and will deliver the most effective results.

If your sales staff is performing outbound sales calls, have them test different entry pitches and offers to see which are most effective then focus their efforts on the proposition generating the best results.

Integrate Your Marketing Campaigns

Presenting the right value proposition to your target audience is only half the battle. Your sales people, reservationists and all customer facing staff need to be in tune with your marketing campaigns. They must understand your value proposition in each market segment and be trained to present the key selling points to each target segment. With this understanding, they will more readily be capable of upselling and increasing your occupancy rates.

Analyze Your Campaign Results

PhocusWright, Inc. estimates that 75% of all hotel reservations are either booked or influenced through online research. Most owners today recognize the importance of their Web site and web-based services to leverage the consumer preference for using the Internet to make their travel plans. Most also have invested a large portion of their marketing spending to either developing a top notch Web site or revamping their existing site to deliver the expected consumer services. Unfortunately, those who stop there are missing the boat. Smart hotel marketers will invest further into developing the search engine optimization tools and integrating electronic marketing programs that will bring more visitors back to their Web site.

The Internet also provides an invaluable mechanism to track and analyze the success of your marketing campaigns. Using Web analytics tools, hotel marketers can track the success of each marketing campaign. For example, you can track the number of visitors who responded to an email campaign, signed up for your rewards program, or visited your Web site from a Web search engine. And if the campaigns are set up properly, you can easily measure the success of each campaign based on the original objectives and expectations.

The information that can be extracted from the Web about your target customers is immense and the information can be used to your advantage to improve your marketing campaigns and optimize your Web site to attract more visitors through Web site optimization. While most hotel owners and their staff are not trained Web gurus, there are many third parties who specialize in Web analytics and optimization and can provide an extremely valuable service to help you better utilize the Internet to your marketing advantage.

Measurability the Key to Marketing Resiliency

A marketing plan is simply a plan and should not be set in stone. Incorporating measurable goals and building analytics into the marketing plan gives it the resiliency that hotel owners and marketers need to optimize their campaigns and improve their ROI.

Jed C. Heller is CEO of The Providence Group LLC, which provides management services to hotels and timeshare resorts. Heller has managed all phases of three start-up ventures, two as the operating partner. He was the president of Goodmanagement, vice-president of The March Company Inc., and president of Premier Hotel Corp., He began his career with Winegardner and Hammons in Cincinnati, Ohio. Heller serves on the editorial board of Hotelexecutive.com and the Resort Management Committee of the American Resort Development Association. Mr. Heller can be contacted at 781-582-8785 or jcheller@providencegrp.com Extended Bio...

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