Company insight

People have spent enough time planning for recovery

Bernard Ellis, vice-president sales at IRECKONU, discusses planning for recovery and how to prepare for the future in the hospitality industry.

executives were already struggling to achieve a fruitful coexistence with each other. Two sides of the same coin, marketing’s job is to decide what customer segments to target, while revenue management decides whom to reject. Just when they would find a delicate balance, group sales would reopen the debate with a big tentative block to lay in.

W What a difference a microbe makes.

Now, every customer should be targeted – beg, borrow and steal any piece of group business one can find, and don’t reject anyone. If this doesn’t sound like the brand’s corporate edict, then corporate might want to take a look at what business the properties have been taking. Decades of industry dogma that discounting does not stimulate demand went out the window (or was perhaps sucked out by an upgraded air filtration system).

hen the pandemic hit, hotel company marketing and revenue management

important to recognise that these challenges also represent opportunities. Articles started coming out over a year ago trying to help people prepare for the recovery. But the only thing that has become clearer about this recovery is that it will have no clarity. Group bookings and corporate volume commitments, the usual leading indicators, are not indicative. Instead, they will serve as lagging indicators of business that never showed up and might not come back. Microscopic mutations, not macroeconomic forces, are calling the shots this time.

Recommendations for the future So, what is a hotel company executive to do? It will be tough to get people to care about future ‘what-ifs’ when their present days are full of ‘WTFs’. Their efforts will become less about planning and more about presiding over an environment of seemingly endless disappointment for all stakeholders. This is obviously not fun and not sustainable. Since trusting their

“At all levels of service, people have discovered that reducing the price creates new demand – just not the demand their marketing or revenue managers would choose.”

Challenges also provide opportunities At all levels of service, people have discovered that reducing the price creates new demand – just not the demand their marketing or revenue managers would choose. Depending on company culture and their role within it, people will either bemoan the lack of brand discipline shown by property management or will congratulate them for doing what they had to do. No matter where they fall, it’s


intuition has probably failed people by now, it’s time to leverage technology for two pursuits that a company’s team might find counter-intuitive: 1. Take a near-sighted view. Stop viewing the situation as a temporary one, but rather as an indefinite one that is going to continue to evolve. Learn from more recent patterns, such as spikes or dips in case numbers, changing WHO guidance, and particular weather events, all of which are likely to recur

before this is over. Historical data no longer means the previous year; it means the past week or even yesterday. The revenue management system will do its best to optimise rates and restrictions, but does it have any way to know what health department capacity guidelines were in effect? Even if someone is usually a die-hard believer in not second-guessing their RMS, now might be the rare time to do so, as long as they have access to as much trustworthy data.

2. Become an expert on the worst-case scenario. Take advantage of the present situation to store away insight for when better times return. While properties may have been following pricing practices that would normally make corporate cringe, it has also become a de facto experiment in discounting that one wouldn’t usually dare to conduct. What price will entice which kinds of guests to trade up from a lower level of service, or to leave the comforts of home for the comforts of a hotel? How loyal do these new customers become to a brand and what price seems to lose them again? Even when better times return, there will still be need dates and off-seasons to fill, and smart marketers will use this period to gain insight into what segments are most likely to respond to offers during such slow times.

If one attempts to follows these recommendations, but discovers that their current technology stack will not allow it to happen, then IRECKONU would love to see how it can help them get better equipped for the near-term and for the long term. ● Hotel Management International /

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