Chapter 10: Sales & Marketing. Hotel Operations Management, 1/e©2004 Pearson Education Hayes/Ninemeier Pearson Prentice Hall Upper Saddle River, NJ 07458.

Chapter 10:Sales & Marketing

Hotel Operations Management, 1/e ©2004 Pearson Education Hayes/Ninemeier Pearson Prentice Hall

Upper Saddle River, NJ 07458

The Front Office

Identify and cultivate clients

Manage hotel’s marketing efforts

Set rates to maximize RevParNegotiate sales contracts on behalf of hotel

Serve as a leader to hotel’s sales & marketing team

Roles of Sales & Marketing

SalesActivities related directly to servicing consumer demand & booking clients

Roles of Director of Sales & Marketing

MarketingActivities designed to increase consumer awareness & demand by promoting & advertising hotel



Planning hotel’s sales and marketing strategyPreparing and issuing sales contracts in timely mannerMaintaining accurate sales records, forecast and historiesCoordinating and communicating special client requests with affected hotel departments

Hosting clients during their stayConducting site tours

Front office

Sales & Marketing

Roles of Sales & Marketing: In the Hotel

Transient roomsInfluence

Group saleInfluence

Tasks of Sales & Marketing staff with their group sales focus



Roles of Sales & Marketing: In the Community

Two sales opportunities

Promotion opportunities

When DOSM and Sales team are active members of the business community (e.g., local Chamber of Commerce), disseminating info about hotel’s products and services is allowed.

Networking opportunities

Development of personal relationships for business-related purposes will result in increased numbers of sales calls.- Convention and Visitors Bureau



Segmentation of the Sales & Marketing Dept.

product designations becoming sales specialty areas

Segmentation based on:

By product(s) sold

By market (market segment)

By distribution network

type of guests (clients) who buy the product

“how” the hotel’s sales (products) are made (distributed)



By product sold


Group guest rooms Conferences

Catered event

MeetingsConventions

Weddings and special events



Guaranteed occupancy, ease of cleaning their rooms, relatively uncomplicated billingRooms often sold at very low daily rates

Vacations, weddings, visits by friends and family, or non-work related reasonsHeavy reliance on travel agents’ advice

Social, military, educational, religious, or fraternal organizations

Business travelers (who pay highest room rates)

Corporate

SMERF & Others

By market (market

segmentation)Long-term stay

Leisure




Potential guest who arrives at hotel without an appointment

Fastest growing distribution channel Creating homepages and linking them to other sites

Largest customers of many hotelsNegotiated rate / blackout dates / pick-up

Retailers, wholesalers or both Using Global Distribution System Receiving commission (5 – 20 %) from hotel

Representative of corporations, groups and organizations

Using comparison-shopping techniques Influence on hotel’s reputation

Meeting planners

Internet

By distribution networkingConsortia

Travel agents


Drop-ins



Maintain record (e.g., demographic data) of hotel’s past, current and prospective clients

Help department maintain its sales records, meet deadlines, and plan future activities

Harmonizes efforts across department lines

Engages in long-term planning

Ensures cooperation of all in sales and marketing process

Sales & Marketing Activities: Sales Efforts

Sales & marketing committee

Trace systems



The sales cycle

Pre-sale phase


Invite client to a site tour

Submit a bid

Post sale phase

Complete “Request for Proposal” and submit on timeEstablish room ratesPrepare group contract (attrition and cancellation policy)Forward Direct Bill application to GroupEstablish group blockDetail client’s contracted requirementsMonitor client’s blockAttend pre-event sales meeting of hotel staff

Write thank you note to each groupReview the final billInclude that group in the hotel’s preferred client databaseFile all written reports

Sales phase



Make a sales visit / presentation to potential client without having previously set an appointment to do so

Visit / call quality prospective clients for hotel’s rooms / services

New leads uncovered since last meeting

Realistic sales potential of these leads

Who in the department is following up on leads

How leads will be pursued

What, if anything, G.M. can do to help cultivate prospect

Any sales resulting from leads discussed previously

Sales & Marketing Activities: Sales EffortsSales lead – effective DOSM should discuss the followings:

Reserve adequate time for cold calling!



Gala client appreciation event

Golfing, sporting events, concerts, theater tickets

Gift giving

Solidify business relationship with current clients (allow hotel to express gratitude to clients for current business)

Communicate to potential clients the seriousness with which the hotel views the hotel / client relationship


Goals Examples

Client appreciation activities



A review of market competition

Occupancy trends /ADR trends / performance of own hotel

Marketing plan development: format of marketing plan


Competitive analysis of your competitor

Strengths / weaknesses / price structure

Competitive analysis of your own hotel

Strengths / weaknesses / price structure

Forecast of future market conditions

Estimated market growth or contraction / performance goals and objectives for own hotel / timeline for achieving these goals and objectives

Determination of specific marketing strategies & activities

Advertising / public relations / promotions

Preparation of a marketing budget

Development of measurement & evaluation tools



Eye or ear catching

Memorable

Sell the hotel’s features

Cost effective

Does not become quickly outdated

Reflect positively on hotel’s image

Can be easily directed to the hotel’s core client groups

Exterior signage

In-hotel and in-room signage and materials

Radio or television commercials

Direct mailing

Internet banners

E-mail message

Yellow pages

Franchiser-supplied advertising vehicles (directories, co-ops, etc.)

Billboards

Personal contact


Types of advertising Effective advertising

Advertising



Promotion


“Special” packaging of products or services Promoted and disseminated by advertising and publicity

Publicity

Information about hotel, media-distributed free of chargeCosts the hotel nothingMay be either good or bad

Public Relations

(PR)

Activities ensuring hotel has a positive public image (good citizen of the community)Hosting charity events, contributing cash or in-kind services, donation of hotel staff time for worthy cause



Teaming of GDS with Internet

Internet Sales & Marketing

Online reservation system

Impact

Travel agents: check availability, compare prices and book hotel on-line

Online booking sites are fastest growing source of reservations in hotel industry



Effective hotel websites should:

Sales & Marketing Activities: Websites

be easy to navigate.have some level of interactivity.be linked to appropriate companion sites (demand generator).allow for online booking.balance guest privacy needs with hotel’s desire to build a customer base.update and revise room rates easily on the website.include a virtual tour of the property.complement other marketing efforts.be in language(s) of potential clients.have website address easy to remember.



The Front Office

Inexpensive to send to many current and potential clients.

Has attachment feature function to move documents quickly.

Automatically updates user database

Can disseminate special rate, promotion, new hotel feature to its client list

Internet Sales & Marketing : E-mail Systems

Traditional communication methods

Direct mailing, telephone, fax

Emerging communication methods

E-mail system

Advantages of e-mail systems



Pace report

Evaluating Sales & Marketing Department: Pace Report

Is a document summarizing confirmed (group) sales made by Sales and Marketing dept.

Can be prepared based on number of rooms sold, value (in dollars) of sales made, or both

Can also include any period of time in the future

Tells hotel’s owner and management the potential sales volume generated by Sales and Marketing department

However, does not indicate what actual sales volume should be (STAR report does!)



Evaluating Sales & Marketing Department: Sample Pace Report

Sold this month Total sold YTDSold same month

last yearTotal sold last

YTDJan 25 150Feb 450 750 250 550Mar 550 1,550 330 1,250Apr 650 1,550 550 1,350May 875 1,175 650 1,050June 1,100 1,400 800 1,700July 1,350 2,250 1,100 2,150Aug 1,700 2,900 1,500 1,900Sept 500 700 750 1,750Oct 300 800 550 1,050Nov 850 1,150 300 600Dec 200 550 125 225

Total 8,550 14,775 7,055 13,575

Waldo Hotel Group Rooms Pace Report for January, 200x



Hotel voluntarily submits financial data to SmithSmith maintains confidentiality of all individual hotel dataCombine operating data submitted by selected competitorsAn individual hotel’s operating performance is compared to that of its competitive set (understanding the competitive set is key component of understanding STAR!)

STAR working process and preparation

Evaluating Sales & Marketing Department: The Smith Travel Accommodations Report (STAR)

Hotel owners, management companies, property management, franchisers, appraisers, financial community

Who are the STAR interest groups?



Operating comparison criteria

Evaluating Sales & Marketing Department: The Smith Travel Accommodations Report (STAR)

Goals

Occupancy, ADR, RevPar, market share, historical trends, to-date performance, state or region

Assess performance of Sales & Marketing department as well as the entire property

Know the strength of hotel and Sales and Marketing staff’s sales results, in comparison with selected competitors.

Chapter 10: Sales & Marketing. Hotel Operations Management, 1/e©2004 Pearson Education Hayes/Ninemeier Pearson Prentice Hall Upper Saddle River, NJ 07458.

Documents

sales marketing slide

sales team

sales contracts

hotels sales products

planning hotels sales

hotel operations management

group sales focus slide

accurate sales records