The biggest challenge hotels face in trying to optimise the potential of all their marketing channels is in how they are internally structured.
Joe Pettigrew, director of revenue maximisation, Europe hotels at Starwood Capital Group, told the Triptease Europe Direct Booking Summit, last week that hotels work in silos.
He said this often leads to hotels own revenue teams “trolling” their own marketing campaigns as they close out promotions by imposing minimum stays or arrival dates.
“This really is because we have people working in silos. No one is talking to each other, no one is really understanding the scope of what we are trying to achieve.
“The first step is to bring everyone together. There is a simple framework we can all work with.
“We need to clearly define our target audience and for that audience what is the best channel to go after them, with what product and at what price.
“It’s important that everyone is aligned to this framework. This framework works across the entire process at every stage. The way you go after different audiences will be very different.”
Pettigrew showed an example of a typical channel share report which he described as “not my favourite report of all time”.
He said this was because it “aggregates information in a way that’s not actionable” and that the data needs to be broken down to a more granular level.
He said hotels should look at channel share by booking window to gain much more useful insight into which channel is performing best at which stage of the booking journey.
Channel share by room type also gives hotels much more useful insight into how to target certain bookers.
“This is important so you know what your customer on each channel are booking and when and how they are booking.
“It’s also important to look at what your guests are saying about your hotel in each channel so you can see what’s important to each customer on each channel.
“That will dictate how you are marketing to them, what messages you are putting out to them. You might find one channel is more sensitive to price.”
Pettigrew said once that has been done the hotel can align revenue strategies to these different customer booking behaviours.
“Your goal is to get the best value out of each of your channels as they exist today. Then you can really start to price to maximise direct revenue share.
“There is a certain level of demand at different points before arrival. If you know this you can price your hotel so you are literally saving that inventory for your direct bookers who you know are about to come in to market.
“Having the guts to actually price to gain maximum share of direct bookings is important. If you start to independently manage your rate by room type you can start to manage your risk at each point in the booking curve and you can start to sell them at a much higher rate.”
Pettigrew said this approach means that hotels can see which channels they can really rely on when they come up against a soft period for bookings.
“You want to build your direct channel share and build in other channels where direct cannot deliver today to maximize revenues,” he said.
Finally Pettigrew said hotels should “go on the offensive” and adopt a test and learn approach.
“There should be someone in the organisation who needs to be more of a revenue strategist, someone who can take charge of every business needs, identify the target audience and bring entire teams together and work to a cohesive plan to start to get to a more positive result.”