A Tale of Two Cultures: How a different mindset will lift food & beverage

By Brian Mitchell Principal, Mitchell Performance Systems | August 19, 2012

Co-authored by Evan Mitchell, Senior Consultant, Mitchell Performance Systems

** This is the first article in a series on improving revenue and profits from F&B

Hotel Food and Beverage is unquestionably a sales-based business. But can it really claim to have a sales-based culture?

In the summer of 1998 the Gillette Company was preparing to hit the button on the most expensive new product launch in FMCG history to that time. It was a product shrouded in secrecy. Through the years of its conception, design and production, what was to be the revolutionary Mach 3 razor went by the code name ER-226. It’s said that even Warren Buffett, a major Gillette shareholder, was kept in the dark.

We were consulting to the company’s sales divisions at the time and were given the task of translating consumer benefits – the product characteristics that had driven the four year design – into retailer benefits. These would provide the sales ammunition the account and category managers needed for their presentations to retailers on launch. There were clearly established strategies for Mach 3, and other supporting products in the Men’s Grooming category, aimed at ensuring immediate market penetration and brand take-off. This was orchestrated to happen in multiple ways via impulse sales, add-on sales, trade-up sales, and solution selling. Each had their own sales messages for consumers – and for retailers. Despite plenty of skepticism in the press and the market generally about the price and product complexity of Mach 3, the launch exceeded even Gillette’s optimistic expectations. Inside six months it was market leader in both North America and Europe.

The meticulous approach taken by Gillette on Mach 3 is typical of major fast moving consumer goods companies in most regions of the world. These are sales-based organizations with a strong sales culture. They recognize the need to adopt a scientific approach to the sales process. And while such sales classifications as impulse, and add-on, and trade-up, and even solution selling, have become somewhat passé in FMCG these days, that’s because they are truisms that are universally accepted, not because they have ceased to matter.

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.