It’s nearly 2:00 a.m. and my brain is spinning circles, so I want to get this idea out there before it’s gone.
In the hotel world, behind all the smiling faces, fancy decor, remodeling, and butt kissing (I mean that in the best possible way), at the end of our day, our jobs boil down to one thing – putting heads in beds.
Unfortunately for travelers (and everyone is a traveler at some point in life), hotels are not non-profit organizations.
Putting heads (or butts) in beds is the number one objective, this is especially true in the city I work in, Rochester, Minnesota. Masses of people flock to our city each year (2.75 million), most of those (70%) to visit the Mayo Clinic.
New hotel, old hotel, remodeled, renovated – it doesn’t matter. Every hotel in this town has an extreme amount of competition, no matter the name brand.
So here is the thought process, there are a few parts…
Same-Day Rates
What if it’s late in the day and someone is in a pinch. What if it’s too late to use conventional hotel booking sites?
Why not offer discounted, same day rates for “walk-in” guests? Why not maintain your “standard” room rates, and offer “suites” for an extremely discounted same-day rate? Get more, pay less (or equal). This would not only introduce guests to your nicer rooms that they normally would not consider, it will also showcase your best rooms that, chances are, unless already reserved, no one is gonna be walking in and asking for anyway.
The guests, especially if informed, will know this is a limited availability room type, and “count your lucky stars, it just so happens we have only one available…“, next time they’re coming to town, they won’t chance it and try to “walk-in”. They want to be guaranteed that room, and they’ll gladly pay RACK to get it.
If you’re concerned about your already overworked front desk, keep the increased walk-in stress off your desk and add in a stipulation that it must be booked through reservations to qualify.
This could prove to be a highly effective way to push short-term, last minute reservations.
Quoting Rates Using Anchor Points
The run of the mill front desk agent sales pitch starts at the lowest rate (which is then used as the anchor for all following prices), works it’s way up slowly, until eventually the guest makes a decision.
It’s kinda like a used car salesman: “Well, this one runs, has 4 wheels and a steering wheel. Want it? No? Okay, for a little more, this one has windshield wipers and A/C. Okay, okay… what about we spend a little more, we’ll give you the hatchback with a little more trunk space and leg room? Deal.“
None of those cars sound very appealing. The first car and price quoted is the anchor. It’s a sign of what the seller has to offer in terms of quality.
A good front desk agent knows not to quote the lowest possible rate and room type, and instead use a higher cost room as the anchor point. This in turn adds value to your property. You’re not quoting the rates that compare to Motel 6, you’re quoting rates that tell your guests that they’ll be treated differently. They’ll be taken care of, comforted, and they’ll have the peace of mind of knowing they’re in the right hands.
If a room is too expensive for someone, they’ll tell you. THEN, you quote the less-expensive rooms (notice, I didn’t say cheap, or cheaper, those are naughty words).
Use your most cost conscious rooms as your fall back when there’s rate resistance from the guest.
Think of it in terms of a fancy restaurants wine list. They have the less expensive wines, the ones in the middle, and then a few obscene, overpriced ones that they never plan on selling anyway, they’re just on the menu to steer you somewhere else. No one wants to look cheap and buy the cheapest options. No one will blame you for not buying the most expensive. So the obvious answer is to choose right in the middle.
The restaurants know this and set up their pricing to profit on this. They mark up of cheapest wines, say 20%. The most expensive wines are priced in fantasy land anyway, so their mark up doesn’t matter. They never plan to sell them, if they do – great, it’s to someone who doesn’t care about money anyway. But then, knowing you’re hand is forced, and you’re going to pick from the middle, they mark those bottles up 50%-60% and make a killer profit. The wine is probably the same wholesale cost as the cheapest menu options, but it will sell ten times more because of its price point.
Social engineering at its finest.
Social Media and Heat Mapping
You’re guests are on the go, and these days, where they are going is your business. (I stole that line from somewhere)
Mobile location applications, or “Check-in” apps, are taking off. GoWalla, Foursquare, Latitude, Facebook Places, etc. They all do the same thing – they let users broadcast to their friends, where they are, and what they are doing there.
Look at it this way. When I “Check-In” at a restaurant (or anyplace), 500 Facebook friends, 200 Twitter followers, 50 Foursquare friends, 30 LinkedIn connections, not to mention my unaccounted for blog readers (through my Twitter sidebar widget), and my Ping.FM followers – all instantly know where I am, why, and most certainly will see a follow up about how great (or bad) it was.
A personal friends recommendation beats an anonymous advertisement blast, 10 to 1. (I made that up, but it’s probably close!)
Enter, Geotoko.
Geotoko is a tool that, “we marketers“, use to find out who has checked in at our businesses. Geotoko centralizes everything, so instead of having a separate account on each different application, it allows you to set a single campaign that monitors each one.
It allows businesses with different locations (or hotels…) to develop heat maps, and see in real time where their visitors are traveling too.
Through your campaigns, you can also give your travelers incentive to “check-in”. “Check-in for a free cheesecake. Check-in for 10% off your room rate. Check in and receive a free beer here, and a free desert across the street at our other restaurant!” Use your heat map to see where you’re getting the most check-ins, and which campaigns are proving to be the most effective.
You can influence the decision making process of your travelers, and profit from it.
Conclusion
Okay, time for bed. I’ll proof read some other day.
But, I guess the idea is just to make you question yourself. Are you really doing what it takes to get a leg up on your competitors? I mean, we all work hard, we all get worn out, and drained, and feel like we’re doing everything we can to succeed, but… really? If you don’t have the time in your day to do it yourself, to learn all these new tools, follow up on them, optimize and leverage them, I bet you can find someone who does. And I bet the cost of him will be negligible in comparison to what he brings your business.
Are you doing everything you can to be on the absolute bleeding edge of technology and competition?
Worse yet to think about, are your competitors?
February 8th, 2012 at 4:53 pm
omg until today I just knw that apple did resell used Mac! thank you!