GuestSpan Speaks!

Next week, the HITEC (Hospitality Industry Technology Exposition and Conference) kicks off in Austin.

We’ll be there.

This will be our first time.

It must be a huge show because hundreds of vendors have spammed me with email and snail mail to get me to visit their booths. With all the hoopla, cocktail party invites, marketing and such, this is going to be big.

But, one mail piece really made me think about marketing to the hotel world.

On the postcard, the following claims were made:

-Add incremental revenue streams
-Enhance your guests’ experience
-Increase operating efficiency and productivity
-Help reduce overall operating costs

These are almost the very same things that we have said about our product since we solidified the concept. Since these are the driving value propositions in the hotel industry, it’s not uncommon to hear them from multiple sources.

But, the part of this that troubles me is the fact that these statements were made by Brother, a company that sells label makers, printers and fax machines.

Holy Crap!

If every peanut butter maker, horseshoe-er, mail carrier and window washer is using these value propositions to try to sell to hotels, I’m going to guess that most hotel execs are almost tone deaf or snow blind to those words. In fact, when a vendor says that they provide incremental revenue streams, the hotel suits must go running for the hills.

I mean, they want incremental revenue, but if one more manufacturer or maid carts tells them that they will add incremental revenue streams, they’re going to start splattering on the pavement below their lovely corner office windows.

Just for the record, Brother makes fine products. I haven’t ever owned one, but they sell a bunch and some people like them.

But, to market to this group of hotel decision-makers, we’re going to have to show value rather than just talk about it. That’s the only way were going to make a splash.

And, thank goodness for the great people that have allowed us to connect, drive us to the right guys and advised us along the way.

That will end up being much more important than all of the hyperbole on trade show postcards.

(Ask us about our research about the connection between fax machines and enhancing guest experience. In brief, there isn’t one…)

We are believers in understanding a market. In fact, listening to clients, prospects and users is almost our religion. If our efforts don’t solve someone else’s problems, all of our work is a glorified ego trip.

But I digress.

We’re still working on our product rollout. However, I was very intrigued by a sampling of data that came back from our Meeting Planner survey conducted this month.

A couple of our questions described a technology device that we are installing directly into hotel rooms. After providing a bit of brief detail about the device, we asked the meeting planners to indicate their likelihood of either being more loyal to their preferred brand or switching away to a competing brand if this device were installed. The results were very strong:

• 46% said they would be somewhat more likely or much more likely to go with their first choice if this device were available to them.
• 30% said they would be somewhat more likely or much more likely to switch from the first choice to a second or third choice if they had access to this device in that property.

Considering the fact that the average meeting planner (and their staff) in our survey plans 20-50 meetings per year and most of these meeting involve 100-500 attendees (with 35% indicating that they regularly plan meetings for 1,000 attendees or more), the dollars in play in these numbers are GINORMOUS!

So, what is this device that was described to meeting planners? We’ll keep a little bit of mystery around this question. Suffice it to say that we’re pulling out all the stops to create a technology device that will satisfy the needs of hotels, travelers, meeting planners and anyone that spends any time in a hotel.

If the data are even close to reality, the potential of our services will provide significant, occupancy rate movements resulting in multi-millions of dollars of revenues for Avant-garde brands.

And, we believe that hotels are looking for that differentiator that will provide an edge. After all, everyone offers a bed, TV, Internet access and shower. Service levels are declining industry wide. Why not look for something that solves multiple problems.

Later, I’ll weigh in with feedback from business travelers and actual hoteliers. Trust me. It’s all good stuff.

Note: Media members may contact me for launch information at cdalley@guestspan.com (801-253-2459)

Recently, Tammy Farley, a Principal of The Rainmaker Group describes their work with casinos, showing them how to change their way of thinking. The first step was to understand what the guests wanted:

Farley and Barfield are both strong believers in personal client service. After taking over the product ‘we pulled our customers together and asked them to tell us what their critical issues were.’ They told us, and we tackled the top ten items. Eight months later we delivered the changes,’ said Farley.

Before changes could be made, hotel ownership thought processes had to be adjusted or the entire plan would have been doomed from the start:

Revenue Management is a Way of Doing Business
In both markets, a shift in thinking was required. ‘Revenue Management is not just a software system, it is a way of doing business,’ said Farley. ‘It requires a cultural change at most companies, we made that education part of our training plan.’ Rainmaker provides best practices consulting to help clients become organizationally ready for the new information profit optimization software delivers.

After the information was gathered, distilled and acted upon, the following recommendations formed the foundation for future management decisions, both strategic and tactical:

Profit Optimization Boot Camp Helps Shift Corporate Cultures
Farley outlined three ways a company can ready its culture to leverage profit optimization software:

1. Shift your focus from occupancy and rate to profitability.

As an example, for Las Vegas casino hotels, think profitability instead of separate food and beverage, show, and spa spends. Farley noted industry champions of this approach include Gary Loveman, chairman, CEO and president of Harrah’s Entertainment, Inc., who brilliantly told Wall Street analysts their metrics do not fit the casino gaming industry. ‘He said to look at gaming profit per room and gaming win per room instead of Average Daily Rate and occupancy,’ said Farley. ‘Harrah’s annual report talks about lifts in those metrics.’

2. Move from silos to integrated departments. Consider letting the revenue management team report through sales and marketing instead of operations. This creates clear communication between the casino sales and marketing department, revenue managers and hotel operations.

3. Recognize the day in the life of a Revenue Manager has changed from crunching numbers to strategic thinking.

‘Companies that develop a focused revenue management philosophy and appoint an experienced executive to manage the process realize the greatest return from a profit optimization system,’ said Farley.

The take-home message is that hotels have to start thinking differently about the guest, the ability to monetize the guest and how the guest experience ultimately influences profitability. High occupancy/Low margin is customary, but “business as usual” is a strategy that appeals to the stale.

What does all this mean to GuestSpan? We’re in the business of showing you how to increase guest experience, monetizing their activities in the community and positioning hotel brands ahead of competitors.

Keep an eye on our blog and product developments. Next year, you’ll be able to say, “I knew GuestSpan back when…”