Being able to search, book and arrange all travel from a mobile device: That's the way millennials know it and, as surveys show, that's the way they want it. These preferences are also shaping the world of modern hotels. Anybody wanting to effectively prepare for the next generation or, better still, the future, should bear that in mind – and build a strong online brand.
Online marketing versus traditional hotel marketing. The very issue that everything hinges on – because the mega trend currently sweeping the hotel sector is 'electronic distribution'. Uli Pillau (front row on the left hand side), Managing Director of hetras, strongly believes that any hotel that is able to successfully make this e-commerce trend work for itself will find itself in a win win situation. Why? "Because these will be the hotels that will be able to get the most online bookings."
The end of classical marketing?
Nearly half of all hotel rooms across the entire industry are now booked online, and the trend is still rising. This trend is largely being driven by so-called next generation hotels, which, according to Pillau, “Are often already selling more than 90% of their rooms through the Internet. Most next generation hotels don't actually market their hotels anywhere else anymore – i.e. they only market themselves online."
New generation hotels tend to reap the greatest rewards of online marketing simply because they know how to make the trend work for themselves. They are already actively building strong online brands with the clear intention of reaching the new generation of mobile travelers. This includes providing online booking facilities (preferably mobile booking), self check-in and out options, a cool interior design from the lobby to the rooms, and: personalized service.
Putting guests center stage continues, as Uli Pillau believes, to be pivotal to success: "One of the advantages of having efficient technology take care of routine operations is that it frees up hotels to provide more personalized services to their guests. It allows them to truly put hotel guests' personal preferences center stage and, rather than collecting data from them, puts hotels in a position to help guests access information that is relevant to them. This can be done through customer relationship management and tools such as a digital concierge or an online travel guide."
Key points for hotel chains to bear in mind when expanding their online distribution strategy
Hotels have to be accessible through all key online channels. That usually adds up to around 5 to 10 booking portals depending on the relevant market. They also need to have their own website and IBE (Internet booking engine). "The quality of a hotel's IBE is crucial to a hotel's success", explains Pillau, "because although computer reservation systems like Amadeus or Sabre make good additional systems, they never generate as much business as OTAs and your own IBE."
What's important: Every channel has to stay open until the last room has been sold. This can be achieved by automating the process by which distribution channels are opened and closed. If this isn't the case, hotels will lose valuable sales. "To do so, a hotel will need an online interface between its PMS and all of these booking channels", adds Pillau.
Allowing revenue managers to centrally manage several properties at the same time
The distribution channels can be managed and configured by revenue managers, which can then adjust room rates on a daily basis and manage the booking channels' settings. According to Pillau, "It also pays to automate some of these processes using, for example, a Channel Management System together with a Revenue Management System." This will then allow experienced revenue managers to centrally manage the rates of several properties at the same time.
This also clearly shows that there are a number of valuable tools available to successfully position a hotel online. However, to Uli Pillau, the single most important element for such success is this: your strategy. Hotels without a clear roadmap for what they want to achieve and how to achieve it are unlikely to generate significant success. Any hotel owner who is unable to clearly answer the following 5 questions is also likely to quickly run into problems:
- What is the right product strategy for my hotel or hotel group?
- What are my target groups?
- What is my pricing policy?
- How can I successfully position my hotel on the market?
- How can I make best use of online channels and review sites?
In Uli Pillaus experience, "Without a clear strategy, even the best hotels are at risk of heading in completely the wrong direction."