Running a profitable hotel today is more challenging than ever. Competition and discounting has never been fiercer while guests are more demanding than ever. Online travel agencies (OTAs) require rate parity and can sell any specials on your website while extracting a 25% fee for their services. They also buy your branded keywords on Google to increase their revenue as a result of your marketing efforts.
Satisfying customers and ensuring they have the best booking experience – whether on a computer, tablet, smart phone or telephone – seems to be a never-ending technological journey.
Hotels seem focused on staying current with the latest technology. This is perhaps why a recent study by Software Advice, a hotel management research firm caught my eye. It wasn’t about technology, but good old-fashioned selling.
The study surveyed 2,500 consumers to identify the incentives hotels can offer to convince callers to book direct. Think about it. In this day and age of rate parity, your call center is the one place your hotel has a real advantage over the OTAs. Once you have a live prospect on the phone, you should use every tool in the book to close the sale now.
If you are negotiating a $4,000 vacation, the hotel stands to lose $1,000 if the caller later decides to book through an OTA. Even worse, the hotel could lose a $4,000 sale if the caller decides to book a different hotel all together.
So what incentives should your call center be using to close the sale now? Here’s what the research said:
- The most preferred incentive is a room upgrade. The nice thing about offering an upgrade is it doesn’t cost the hotel a thing if the room would go unsold. But it doesn’t mean that’s the only incentive to offer since some people are motivated by other options like room service or a visit to the spa.
- Offer a variety of room upgrades. While 29% preferred to be upgraded to a suite with a living room, almost as many preferred a room with a better view. You know your property best and the more options you have, the better chance reservations has to find one that will resonate with each caller.
- Free meals top the list of in-room perks. Surprisingly, 43% of consumers were more interested in a free meal – more than twice as many that would prefer an in-room massage. Perhaps this is why you see so many “kids eat free” and “free breakfast” offers used by hotels.
The number of perks a hotel has to offer to close a sale now is only limited by your imagination. Every perk, however, needs to be packaged in a way that shows the real benefit to the caller. To help your reservations team, create a list of perks they can offer to close a sale.
At the end of the day, you want the sale to increase profitable direct bookings, reduce dependency on the OTAs and of course, make the guest happy. A happy guest is a loyal guest, one that will hopefully bring you repeat business and write a positive TripAdvisor review.
About Madigan Pratt
Madigan Pratt has more than 25 years of strategic marketing communications experience, including advising Fortune 500 companies, Tourism Boards, destinations, and luxury resorts. Madigan leads a team of marketing, public relations and social media professionals at Madigan Pratt & Associates. Originally founded in New York and now headquartered in Williamsburg, Virginia, Madigan Pratt & Associates is an award-winning marketing and advertising agency specializing in customer relationship marketing for hospitality and luxury service clients.
A well published author and popular conference speaker, Madigan provides expert counsel to the hospitality industry and publishes tips at Hospitality Marketing Blog. He has served on numerous travel industry association boards including the Caribbean Tourism Organization, The Association of Travel Marketing Executives and HSMAI Resort Marketing Advisory Board.
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