As we enter into the final months of 2014, the global hotel industry is experiencing one of its strongest years of the decade. Most statistics are showing a positive path and indicating the long awaited recovery has arrived. As a result, now is an opportune time to evaluate strategies and begin laying the foundation for strong RevPAR performance in 2015 and beyond. Let’s take a closer look to better understand how to shape the future with present day solutions and best practices.
SoLoMo: It’s here today and becomes even more important in the future
If you are not already familiar with the SoLoMo acronym, then you may be at a competitive disadvantage. Social, Local and Mobile best practices have emerged and graduated from fad to phenomenon status within recent years. This is truly no longer a trend but a long-term necessity that hoteliers need to be focused on.
Present day and future hoteliers need dedicated resources with the expertise to manage social channels. The skill set required for the role must fully understand responsive design, graphical user interface reservation conversion, search engine marketing and consumer purchase behaviour. Some best practices include being aware of, and closely monitoring local competitor’s revenue management and marketing strategies. For example, what pictures are local competitors posting on social media channels to attract engagement? Are your competitors changing out visual illustrations and copy, or are they posting the same one or two photos and stale comments across all social channels? Does your local competition show up on page one of a Google search? Are these hotels gaining higher ADR revenue from the GDS channel simply because they are paying attention to it? Knowing the answers to these questions is vital in gaining localised competitive RevPAR advantage.
Rate alone doesn’t drive conversions. Work to create compelling value
It’s essential for hoteliers to drive conversion from a combination of competitive rates and value added inclusions. This best practice began in the last economic downturn and should continue well into the foreseeable future. The top two most common inclusions are free WiFi and/or food and beverage credits. Hotels with the best conversion rates are the ones deeply invested in developing consumer and travel agent marketing strategies to generate unaided recall of their local competitive advantage and value added offerings.
Most major brands now offer free basic WiFi, and often a food and beverage option for guests enrolled in their loyalty programmes. Independent properties must compete to attract these high frequency travelers with similar added value. It’s important to understand that discretionary travellers have many hotel choices, so they need to be constantly reminded of the unique value a property has to offer, especially when they are actively engaged in the process of shopping for a hotel with specific stay dates in mind.
Good news: You can offer value without bearing all the cost
As the use of mobile devices continue to grow, it has become a rare occasion for a traveller to visit a local area without their mobile device. This creates additional opportunities for hoteliers to provide value to their guests. Creating a competitive advantage does not necessarily mean all of a hotel’s value must be fulfilled within a property. Top and trendy establishments within walking distance from a hotel are an excellent way to drive conversion simply by ensuring these places are easily referenced and accessible through a hotel’s mobile website. Don’t underestimate the value of reference points within walking distance from your hotel. Studies continue to show that in large metropolitan areas consumers are increasingly selecting hotels to maximise enjoyment and time at a minimal expense. However, to maximise online conversion the nearby amenities must always appear and be readily present and appended throughout a hotel’s virtual booking experience.
Saving the best for last
These management practices are not overly expensive or difficult to manage given the right tool kit combination of marketing competency, forward-pacing business intelligence and revenue management practice. In fact, there is a far greater cost of falling behind and not capturing the full benefit of the current economic recovery. The return on investment (ROI) becomes apparent with an understanding of how these practices best maximise conversion and RevPAR in 2015 and beyond.
(The writer is senior vice president, global product management, TravelClick)