It is hard to believe that we are talking about our Winter revenue strategies when it feels like Summer just started and yet, here we are.
For seasonal hotels that slow down close to Thanksgiving there is typically a shift in what business we are willing to take, under what conditions we take it and how we sell our hotel. There are a few solid strategies that should be in place now to drive occupancy and assure we are set up for success over the slower times especially the winter holidays.
Strategic Seasonal Pricing
This is a good time to review competitor Retail pricing for the off-peak months and get out to see if anything has changed in our competing hotels. Pricing may need to be adjusted based on what most of the competitive set is doing. This is critical for Holiday weeks where everyone is fighting for the little bit of business that is out there and it pays to set up our off-season strategy early in case of early bookers. This does not necessarily mean being the first to lower rate which may cause other hotels to lower their rates resulting in nothing gained for anyone.
We can all agree with expenses and the cost of living increasing we need every dollar we can get. When reviewing slow season rate strategy, the Premium pricing on different room types is also something that warrants a closer look. Many of us increase premium pricing on room types due to summer demand which may not apply in the off season. If the premium on double rooms was increased in May for summer leisure traffic, then it may be time to bring that back down if we are not expecting that same traffic and our customer base typically shifts over winter. Along the same line the percent Discount on AAA and Senior rates may have been dialed back earlier in the year due to high demand.
We should also revisit those discounts as we approach a slower season to assure we are competitive to who we price to. This would include rates such as AAA, Senior Rate and Advance Purchase rates. Tools such as Lighthouse or Demand 360 make it easy to obtain competitor positioning so we can determine the right price position and monitor the success of our discount strategy. Often our Government rates are set to per diem earlier in the year and easily forgotten. If the Retail rate in off season drops below per diem, then the Government rate will likely need to fall in line with retail especially if the competitive set is adjusting this rate. With some brands it is a requirement that the Government per diem rate is in line to Retail.
Group Rates are another consideration over the occupancy challenged months. Reviewing our Group Guidelines with seasonal changes makes sense. We should verify that these guidelines are still competitive and are designed to drive group occupancy over winter. Additionally, many brands have online Group Booking Tools priced at a percent off Retail rates. The percent off can be adjusted if it makes sense to do so in needs times. Another idea is to offer group perks during needs dates to capture more group bookings. Perks such as a complimentary late check out or bottled water, free room upgrades or a free shuttle to the group event venue does not cost us a lot and could result in additional bookings.
Revisit Restrictions and Closures
Many of us add tighter restrictions in peak season such as adding minimum stays on peak midweek, or we close out deeply discounted rates. It helps to keep a record of these changes and revisit them as we transition into lower occupancy months as restriction changes from several months ago are often easily forgotten. Sometimes looking for a restriction added in the past is like looking for a needle in a haystack. It is best that these restrictions have an expiration that lines up with business levels.
Opaque, Wholesale, Employee and Friends and Family rates might not make sense in high demand, but they can be great occupancy builders in needs times. They may need a cap to limit how many can sell. While the rate on these programs may not be the best, they can bring other additional incremental revenue that is beneficial such as parking fees, lounge, and restaurant revenue or in house market business. Several of these discount programs can be shopped through the shopping channels to determine best positioning and for Opaques the Market Manager can provide a pricing comparison report often with recommendations.
Many brands allow fluctuations to the booking window on Advance purchase programs. Another opportunity might be a shorter booking window on the advance purchase rate designed to drive occupancy. With the return of busy season this can be adjusted back to a longer window to drive rate.
Driving More Occupancy
When allowed by the brand Online Travel Agency promotions are a great occupancy builder during needs times. If Online Travel Agency Promotions, Accelerators or Travel Ads were paused for Summer it would be beneficial to take a second look at these programs. It is worthwhile to review and adapt the verbiage on our seasonal promotions, so that it lines up with our seasonal demand drivers. Additionally, now is the time to adjust Points of Interest for Expedia and other Online Travel Agencies based on seasonality. It might be necessary to substitute a Summer demand generator for a Winter one such as an Amusement Park open in Summer switched out for a Ski Resort open in Winter.
Leveraging these Online travel agencies is a proven way to increase our visibility and draw in more customers in slower times. Overall, it helps to schedule a quarterly review of our presence on all booking channels to optimize our visibility. With less customers to capture in slower months we want to be in front of as many potential customers as we can. This not only applies to OTAs, but to our own Brand sites as well.
Creative Seasonal Packages designed around winter events can be a great occupancy driver during slow times. Just booking a few extra rooms a week can make a big revenue difference in a quiet month. Ideas such as packages built around New Years Eve, Valentines Day, Holiday Light Shows, a Holiday parade weekend, or Holiday shopping opportunities can attract new customers. An investment of time and some creativity could result in a big revenue win in an otherwise slow month. How fun would it be to create a shopping package that includes a gift card to a popular retail location, retail coupons and offers and complimentary gift wrapping? How about a Holiday parade package that includes “to go” mugs of hot cocoa and fresh baked cookies?
Adding perks like a late checkout or free shuttle to the mall do not cost us much but represent a value to the customer. Bundled packages priced as a value add can make these offers even more attractive in the off season. Can we create our own “event” to drive occupancy such as a Breakfast with Santa weekend or Breakfast with the Easter bunny and create packages around these events? Not only would this drive room revenue, but food and beverage could benefit as well. How about a Spa Package and have a local business come in and do mini manicures, hand massages and eyebrow waxing or other spa services? Can we partner with local businesses for dinner packages or New Years Eve packages? What can we try that our competitors are not doing that will make us really stand out? The possibilities are truly endless. Once in place, packages can be marketed via the brand or through social media platforms or even email. For in house Holiday parties without group room blocks we can entice the party guests with an attractive “take the elevator home” offer so they can relax and not have to worry about driving home that night.
Another strategy is to create an offer designed to attract guests to arrive early or stay longer such as a “Buy One Night” promotion with a discounted second- or third-night offer. Perhaps a compelling Sunday rate would tempt weekend guests to stay longer. Along this line a dedicated long term stay rate may also drive additional revenue during needs times and can be marketed to local industry with this specific need.
We have mostly talked about driving room revenue, but all departments can be utilized to drive additional hotel gains. This includes, but is not limited to guest parking, catering, the swimming pool and workout area, restaurant, lounge, and market. It might be fun to bring the entire Management team together and brainstorm new ideas to generate additional income in all areas. The outcome could be surprising and may result in some new initiatives. To sum it up, with slower times on the horizon for many of us assuring we are priced correctly, open on all channels and using a bit of creativity to engage more customers will no doubt assure our continued success even in the off season.
Reprinted from the Hotel Business Review with permission from http://www.hotelexecutive.com/.
Recent Comments