4 balls of money growing like hotels profit can differ from one to another

I will try to put down all the factors affecting a hotel’s bottom line and what makes a hotel get a competitive edge over its competitor in the same category and location.

NB: This is an article from eZee Absolute

The marketing game

When you’re running a hotel, marketing should be one of your first and foremost strategies. Hands down!

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During my stay at both the hotels, I did my part of the research. Be it their Facebook page, Instagram page, pamphlets, billboards and everything in between, I checked out all of it; just to get a glimpse of how their marketing game is.

From that, what I understood was having a huge follower base doesn’t mean you’re a popular brand. And that’s exactly what the second hotel was into.

They had a great number of followers on all their social channels but had major flaws.

  • They didn’t define a target audience for their hotel. Meaning, their followers were just engaging with their posts/content but not buying any stay.
  • The content wasn’t in line with the hotel’s end goal. It was good enough to make people hit that like and follow button; but again, it wasn’t selling anything.
  • They were not betting big on traditional marketing strategies either. (I really don’t know why people underestimate traditional marketing these days.)

Now, talking about the first hotel I stayed at, their marketing game was on point. And the reason I booked that hotel explains it.

The hotel was mostly targeting people who would prefer to stay near the airport. So, when I missed my flight and was confused about my next move, I saw these pamphlets of the hotel at a cafe. That’s when I booked.

Not to mention, on my way to the hotel, I could also see a billboard of the hotel.

Do you see the difference? It’s all about the right hotel management strategy if you want to compete with hotels in the same location and other competitors.

Revenue management and pricing

Another significant difference that made one hotel count good bucks and other hope for it was their hotels pricing and revenue management strategy.

This I am saying because I did have a conversation with the managers of both the hotels.

Before checking out from the first hotel, I talked to the manager and asked him certain things about their pricing strategy. He said that their pricing aspect is being handled by a revenue management services company. They use intelligent pricing strategies after a good amount of analysis.

When asked whether he’s witnessed any change, he said and I quote:

“To be honest, I never thought that such a good rise in revenue was possible. Without an inch of doubt, the changes are great. I do accept that initially, it took a little time to take off. But once we hit our revenue goal, there’s been no looking back.”

Now, it’s not that the other hotel wasn’t using revenue management, but there was still amiss. The revenue manager was doing a good job, but then there were limitations. Maybe he had limited data to run analysis on or was running short on manpower.

(Also, I am assuming, the final call regarding pricing was always from the hotel manager. I could sense it. Basically, the in-house revenue expert wasn’t getting the right atmosphere to work on.)

Bottom line? Outsourced revenue management was working much better than the in-house one.

Hotel management strategies and technology

To run a successful hotel business, you need to have top class hotel management skills. I am not talking about the ones you learn from traditional hospitality courses. Rather, the ones you learn from experience and from out-of-the-box thinking.

Read rest of the article at eZee Absolute