Borrowed Brilliance: Applying Lessons from the Retail World to Hospitality
By Kieran Donahue Vice President, Global Brand Marketing, DoubleTree by Hilton | November 25, 2012
The retail industry long ago figured out how to build a sustainable, year-round customer base and continues to creatively adopt new techniques and technology to build on that base. We in the hotel industry can learn and borrow from their success.
Reaching today's traveler is much more than just creating awareness or pitching a special deal. While promotions remain a core strategy for attracting guests, savvy hoteliers must be more nimble and creative in order to inspire the guest to want to travel. The operative word is "inspire."
I began my career in fashion manufacturing and retailing before entering the hotel industry more than a decade ago. The underlying strategy of retail marketing is to "calendarize" the year and create demand according to purchasing patterns and seasons. Rather than just line up a series of promotions, retailers seek to inspire customers to purchase products. That's why retailers successfully sell winter coats in the heat of summer and swimming suits in the dead of winter. They inspire demand by understanding upcoming "moments in time" that consumers dream of and plan for, and work to activate purchase around those moments.
Up until the mid-1990s, the hotel and retail industries were pretty similar "bricks and mortar" businesses. You went to Macy's to buy a suit, to Barnes and Noble to buy a book and to Doubletree by Hilton to spend the night.
The retail model changed in 1995, when a Seattle-based upstart, Amazon, set in motion a revolution in the way bookstores did business through e-tailing. At first scoffed at and scolded for not making a profit in its first six years of existence, the company, through perseverance and smart marketing, grew to more than $1 billion in annual revenues, earning founder Jeff Bezos Time's "Person of the Year."
About the time that Amazon opened its doors, OTAs entered the travel market and began to change the way consumers looked at travel.
Technology has unlocked new ways for hotel companies to not only sell rooms, but also to get to know their guests and potential customers. We have the opportunity now to become a trusted friend. With both domestic and international travel on the rise, there are many transferrable lessons from our friends in retail that we can profitably apply to the hotel industry.