Demographics Positioning, or Shifting: Who to Partner with to Achieve Your Goals
By Loulu Lima Principal, LL Consulting | November 03, 2013
Co-authored by Steven Rubin, Vice President and General Manager for Travelzoo's Most Loved Hotels program
Revenue Management definition: To sell the right product to the right customer at the right time for the right price via the right channel.
But how do you get there? We all know the leaders of data production - Smith Travel Research produces daily, weekly, and monthly reports on your hotels performance vs the competitive set. Travelclick supplies you with more intelligence on rate shops and Travel Agent production through hotelligence and more. According to STR and TravelClick during the HSMAI ROC conference this past June, Transient Travel is increasing however group travel is declining between 2-4%. Furthermore TravelClick statistics show that Leisure travel has increased and is forecasted to continue growth.
This is great information but it still doesn't answer the question how do I reach the right customer at the right time and what channel are they using? So who is providing you with demographic information? What does it mean and how can it help you create stronger strategies?
Let us together identify the proper partnerships to help you get there. From online travel agents (the big 4 but not limited to – Travelocity, Expedia, Priceline, Orbitz), consortias, traditional brick and mortar travel agencies, media publishers - online and print that help you drive direct, and your Metamediaries (Google, Bing, Facebook, Twitter, Amazon, TripAdvisor and the like). Ask the tough questions of each:
- Is this distribution partnership helping me grow in rate or occupancy?
- What is the cost of this distribution option?
- What reach do they offer? Have they grown or changed their reach in the last year?
- What makes them so special that a customer books with them? Do you want this customer?
- Does this partnership create difficulties by controlling your distribution? Do they give you the flexibility you need to diversify your channels or are you putting your eggs all in one basket?
- Does this partner have many no-shows or cancellations? How about fake reservations that you are liable for?
- Does this partnership help your social foot print?
- How do you actively track your marketing campaigns?
- What criteria do you have to identify your most valuable customers
- Are you adjusting your marketing spend to reach these demographics?
When you look at your distribution partnerships are you analyzing what each brings to the table or is it a necessary evil for heads in beds? The consortia's, OTA's, media partners and the like, are they a true partnership? Do they care about your goals and are they helping you achieve them? Do they restrict how you can distribute your inventory? Distribution partnerships should take into account your P&L statement and help push as much revenue to the bottom line as possible. If during your peak periods, you find yourself not being able to shift market share and segmentation to direct bookings for a lower cost of distribution, then you take into account how much this cost of distribution is costing you. How do they help you in low demand periods? Are they creative in finding ways to drive traffic to you? Let's identify what each one has to offer and cost: