Advertising Is The Tax You Pay For An Unremarkable Product

The GM Checklist for Hotel Marketing

A business woman looking at the camera
The GM Checklist for Hotel Marketing

Tambourine

This article originally appeared on Tambourine.

The cost of guest acquisition is on everyone’s mind these days, which means GM’s are feeling pressure from ownership, asset managers and their hotel management companies to maximize the ROI from their marketing investments.

GM’s have responded in two positive ways:

1. GM’s are now holding their marketing teams accountable for contributing – in a tangible, measurable way – to revenue goals and generating leads.

2. GM’s are also championing their marketing team’s efforts and investing more time than ever before in improving their understanding of the complex challenges facing their hotel marketing team

To support this effort, here’s our list of 10 significant hotel marketing elements that every GM should be familiar with:

1. The Four Marketing Pillars: Price, Product, Promotion and Placement

A smart, easy place for every GM to start is understanding the four traditional pillars of marketing that directly drive the success of your hotel:

Product 
The most important of the four, classic marketing “P’s”: How does your product differentiate you? Consider both the hotel’s physical product (rooms, restaurant, meeting space, amenities, spa, etc.), as well as the service experience. GMs need to constantly work with their marketing team to determine if their product or service experience needs improvement (and then ask ownership for the funds)!

Promotion (i.e. Advertising and Traffic Generation)

More than anything else, the GM MUST ensure that the marketing team’s promotional expenses and investments are synchronized with the hotel’s targeted business mix

Placement (Distribution Channels)

GM’s need to know where the business is expected to come from and how the property’s rates and inventory are positioned there? How many groups vs transient do you expect and how much is actually being generated? How much inventory are you allocating to OTAs? Is your team relying too heavily on OTAs to reach revenue goals? Or, are you thoughtfully optimizing your own hotel website and booking engine to attract more profitable, direct bookings?

Marketing Matrix

Price

Your revenue management team controls pricing, but price is an unavoidably critical element of marketing. GMs need to have consistent, accurate visibility to ADR vs the compset. GM’s should also strongly encourage close cooperation between their marketing and revenue management teams.

2)  What your Marketing Team Needs from YOU to Succeed!

Your marketing team can’t survive without the GM championing their efforts and giving them the right amount of funds, tools and resources to succeed. The key is to simply, and constantly, ask them what they require from you to achieve their goals, then make it happen.

3) The Quality of Your Product 

We want to underscore the importance of your PRODUCT in the marketing mix.

No amount of clever advertising or promotion can overcome an inadequate product or me-too service experience.  Keep in mind this compelling quote by Robert Stephens, founder of Geek Squad, “Advertising is the tax you pay for an unremarkable product.”

There are far too many hotels that continue to sink millions of marketing dollars to over-compensate for or to cover up an aging, lackluster, or grungy hotel product. The less you pay attention to improving your service and your hotel product, the higher your marketing and advertising expenses will be to make up for it.

GM’s can best serve their marketing teams by driving product improvement first!

By refusing to cut corners, investing in quality from the front desk to the back of the house, and by presenting the best guest experience that your staff can deliver, guest sentiment will go up, your number of repeat guests will go up, profits will go up and your marketing cost per booking will go down.

4) How Marketing Investments Correlate to Projections

Smart GM’s know exactly how much revenue they expect from each segment of the hotel’s business. And they expect their marketing teams to correlate their investments for leisure/transient, group, corporate and F&B.

Generic, aimless and “pretty picture” marketing won’t cut it. Every marketing activity should be done with the intention of achieving the segmented revenue goals of the overall business mix.

Check back in throughout the year to see how your marketing team is synchronizing their allocated budget and resources to align with revenue projections.

5) Your Property’s Story

Consistently and creatively telling a meaningful, truthful story is what truly attracts travelers. However, many hoteliers don’t know what their story is, much less how to convey it. Correctly telling your story means knowing your audience, being honest about your assets and getting all stakeholders in agreement about your property’s unique identity so that you can convey it poignantly across all your marketing channels.

Travelers are no longer drawn to sterile facts, puffy promises of a wonderful stay or mentions of your recent industry awards. They want to be a part of something that intrigues them, connects with them and gives them something to brag about.

GMs should be vigilant about their marketing team’s ability to propagate a unique story across all channels.

6) Actual Costs of OTAs vs Marketing Expenses

Every good hotel marketer must know the actual costs and expenses of each channel. OTAs are particularly tricky to track, as their commissions are often hidden, yet are one of the costliest expenses to hit your bottom line (OTAs usually pay a net rate back to the hotel, so the actual cost will never show up in your financials). Lean on your marketing and revenue team to track the real expense of OTA bookings and compare that to the tangible expenses that power more direct booking channels.

7) The Ratio of Direct vs 3rd Party Revenue

This goes in tandem with #6. Many hotels are still relying disproportionately on higher cost channels for business. With rates and occupancy at an all-time high, one of the primary areas GMs can affect is COST of acquisition!

And owners are watching this closely.

GMs should check the pulse on this each month to compare how many bookings came directly through your hotel call center and website versus costly 3rd parties.

8) How to Augment the Brand’s Marketing Program

Brand affiliation offers many benefits… But custom marketing targeted to your specific audiences is not one of them.

Branded/flagged properties need to augment their brand’s core program with timely campaigns and custom direct “vanity” websites that help fill periods of need. Instead of solely relying on the brand’s standard marketing program, which is duplicated for every other sister hotel in the region. Your marketing team should be proactively differentiating your property, customizing your website, and boosting your search engine optimization (SEO) and social media efforts.

9) Marketing KPIs 

Get familiar with the KPIs your marketing team is responsible for while ensuring they are not spending too much time tracking vanity metrics. Metrics should offer insight that GMs and the property owners consider high priority (like how much your marketing team is actually contributing to the hotel’s revenue targets). Hotel marketers should be able to share vital KPIs like direct revenue ratio, leads generated for the sales team and marketing cost per booking (MCPB).

10) Why You Lose Business to the Compset

Winning is easy.

Losing requires painful introspection.

A majority of hotel sales and marketing teams fail to ponder why people chose another property. Whenever your team loses a major group deal or market share, the GM needs to ask the team: Why did we not win this business?

What went wrong… How could we have done better?

This simple follow-up could dramatically empower, alter, and inform your future sales efforts.

Also, your team should never lose track of what your comp set is doing. In fact, there are so many tactics and tools at your disposal, that a competitor’s success should never come as a surprise. Keeping tabs on your compset will give you the insight to finesse, and possibly pivot, your own marketing campaigns.

About Tambourine

Tambourine uses technology and creativity to increase revenue for hotels and destinations worldwide. The firm, now in its 33rd year, is located in New York City and Fort Lauderdale. Please visit: www.Tambourine.com



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