Chapter 3 sales and marketing in hotel

Sales and Marketing in Hotel Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Importance of Sales and Marketing DOSM: short for “Director of Sales and Marketing.” Variations include DOS (Director of Sales) and DOM (Director of Marketing)   www.hsmai.org Sales: activities directly related to a client’s purchase of hotel rooms or services   Marketing: activities directly related to increasing a potential guest’s awareness of a hotel Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Importance of Sales and Marketing Booking: hotel jargon for making a confirmed sale Effective Marketing Activity  Increased Consumer Awareness  Increased Hotel Bookings  Increased Hotel Revenues  Increased Hotel Profitability Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Sales and Marketing Activities Three types of activities in the Sales Cycle: Pre-sale Activities Sales Activities Post-sale Activities Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Sales and Marketing Activities Pre-Sale Phase Site Tour: a physical trip (tour) of a hotel, hosted by a member of the hotel’s staff   Bid: An offer by a hotel to supply sleeping rooms, meeting space, food and beverages, or other services to a potential client at a stated price If the bid is accepted, the hotel will issue the client a contract detailing the agreement made between the hotel and the client Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Sales and Marketing Activities Sales Phase Pickup: the actual number of rooms purchased by a client in a specific time period.  Group Contract: a legal document used to summarize the agreement between a hotel and its client group   Attrition: the difference between the original request and the actual pickup of a group   Block: rooms reserved exclusively for members of a specific group Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Sales and Marketing Activities Post-Sale Phase  Thank-you letters  Adding clients to a preferred client list  Formulating plans to retain the business the following year Convention and Visitor’s Bureau (CVB): an organization, generally funded by taxes levied on overnight hotel guests, which seeks to increase the number of visitors to the area it represents Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved On-Property Activities Marketing Plan: a calendar of specific activities designed to meet the hotel’s sales goals Sales and Marketing Committee: the team of individuals responsible for coordinating the hotel’s sales and marketing effort   Inclusive: a single price that includes all charges Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved On-Property Activities Marketing plans vary but most include:  An overview of competing area  Competitive analysis of each competitor   Competitive analysis of the hotel  Forecast of future market conditions  Plans relating to specific marketing strategies  Advertising: information about a hotel that the hotel pays a fee to distribute  Promotions  Publicity: information about a hotel that is distributed for free by the media  Development of a marketing budget   Selection of measurement and evaluation tools Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Hotel Markets Group Travelers Hotel services often used by groups:         Catered meals Meeting space Audio visual equipment Registration services Transportation Baggage handling Welcome receptions On-site activities Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Hotel Markets SMERF: short for Social, Military, Educational, Religious, or Fraternal groups and organizations Meeting Planner: a professional employed by a group to negotiate that group’s contract with a hotel www.mpiweb.org Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Sales and Marketing Tools Useful hotel selling tools:  In-person sales calls  Print and direct mail  Telephone  E-mail  Web sites Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved In-Person Sales Calls Lead: information about a prospect who is likely to buy products and services from the hotel   Sales Call: a meeting arranged for the purpose of selling the hotel’s products and services   Networking: the development of personal relationships for a business-related purpose Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved In-Person Sales Calls Cold Calling: making a sales visit/presentation to a potential client without having previously set an appointment to so   Drop-in: a potential group rooms or hotel services buyer who arrives at the hotel without an appointment Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Print and Direct Mail Direct Mail: the process of sending an advertisement to clients by U.S mail service The total cost of a direct mail piece includes the expenditures for the advertisement’s design, printing, and mailing Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Print and Direct Mail The best direct mail pieces: Are eye catching  Reflect positively on the hotel’s image  Don’t say too much  Introduce relevant hotel features and benefits  Support the benefits with proof statements  Are cost effective  Ask for the sale (order) or a site visit  Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Telephone Telephone can be used to:        Make transient reservations Answer questions about potential group reservations and bids Find prospects who may be interested in a site tour Identify prospects and arrange dates and times for in-person sales calls Increase the speed and accuracy by which information is transmitted to the caller Overcome resistance to sales barriers Improve phone-generated hotel revenue www.ei-ah&la.org Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved E-mail General principles for using e-mail as a sales tool:  Maintain an up-to-date list of e-mail addresses  Create messages that are short, yet effective  Send e-mails at the proper frequency  Provide a convenient way for receivers to be removed from your e-mail list Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Web sites In 2003, internet hotel sales accounted for 12% of all reservations made.  www.acromarketing.com Link: a relationship between two Web sites When website users select a link at one site, they are taken to another Web site address An external link leads to a webpage other than the current one; an internal link leads elsewhere on the current website   Demand Generator: an organization, entity, or location that creates a significant need for hotel services Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Client Appreciation Activities Appreciation activities can help to retain clients Could include: Social activities  Outings  Events  Gifts  Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Evaluation of Sales and Marketing Efforts STAR Report: short for the “Smith Travel Accommodations Report.” Produced by Smith Travel Research, this report is used to compare a hotel’s sales results to those of its selected competitors Areas to consider when evaluating performance: What? Who? How Much? How Effective? Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Evaluation of Sales and Marketing Efforts Competitive Set: the group of competing hotels to which an individual hotel’s operating performance is compared   Information is important to:       Hotel Owners Management Companies Property Managers Franchisors Appraisers The Financial Community www.str-online.com Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Evaluation of Sales and Marketing Efforts Popular operating comparisons include:        Occupancy ADR RevPar Market share Historical trends To-date performances City, region, or state performance Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved Evaluation of Sales and Marketing Efforts Poor STAR performance can indicate:        Poor franchise (brand) name Poor signage Poor room mix for the market Room Mix: the ratio of room types contained in a hotel Sub-standard furnishings or décor Marketing/advertising budget too small Marketing staff too small Marketing staff ineffective Hayes/Ninemeier: Foundations of Lodging Management (C) 2006 Pearson Education, Upper Saddle River, NJ 07458 All Rights Reserved ...Importance of Sales and Marketing DOSM: short for “Director of Sales and Marketing. ” Variations include DOS (Director of Sales) and DOM (Director of Marketing)   www.hsmai.org Sales: activities... Activities Marketing Plan: a calendar of specific activities designed to meet the hotel? ??s sales goals Sales and Marketing Committee: the team of individuals responsible for coordinating the hotel? ??s sales. .. Effective Marketing Activity  Increased Consumer Awareness  Increased Hotel Bookings  Increased Hotel Revenues  Increased Hotel Profitability Hayes/Ninemeier: Foundations of Lodging Management