HSMAI + TrustYou White Paper: Do You Know Your Guests?

Throughout the pandemic, hotel companies adapted to the new dynamics of customer feedback. During recovery, they’re applying the lessons they learned — and implementing solutions that are increasingly responsive, adaptive, and data-driven.

The Hospitality Sales and Marketing Association International (HSMAI) and TrustYou present Do You Know Your Guests?, a new white paper that discusses how the pandemic changed guest behavior, including how they travel and what they expect from hotels; best practices for responding to guest feedback; and how automated solutions can help.

Through interviews with industry leaders, HSMAI and TrustYou explore how companies have applied the lessons they learned during the pandemic to implement responsive and data-driven solutions.

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The New Priorities for Revenue Management Systems

Even before the pandemic, hospitality revenue management systems (RMSs) were not perfect. Many revenue leaders have long felt RMSs weren’t keeping pace with platforms in other industries, to say nothing of the increasingly robust consumer technologies we enjoy.

COVID-19 has only made the problems worse. As revenue professionals have been forced to do more with less, the weaknesses in their RMS platforms have become untenable for many. As a result, many revenue leaders are reevaluating their RMSs and the entire tech stack, looking for better solutions to meet their rapidly evolving needs.

To start, the shifting realities of revenue management have created new priorities and new must-have features for any RMS. These are the priority features that revenue leaders from across the hospitality industry identified:

Affordability: Budgets are still tight, and that won’t be changing anytime soon. In fact, this is part of a trend that predated COVID and has only gotten more pronounced, which makes cost-effectiveness a top priority for any RMS.

“Leadership has looked for immediate opportunities for savings,” said Eric Gravelle, vice president of revenue management for Diamond Resorts International. “Is it slashing a program we’ve been using that looks like a luxury item? The number of people performing analysis? We’ve been hit hard with that.”

Resilient forecasting: Forecasts are broken. We heard that from our expert sources time and again. “The RMSs having most success use multiple forecasts,” said Timothy Wiersma, CRME, principal of Revenue Generation LLC. “They’re not placing their bets on just one forecast, but they’re playing multiple algorithms to come up with a forecast and then tracking the results for accuracy.”

Native multi-property functionality: More hotel companies are shifting to clustered and centralized models for their revenue teams and need an RMS platform that is purpose-built for that dynamic. “Most RMSs were designed for one-property directors of revenue management,” said Dax Cross, CEO of Revenue Analytics. “But there’s not many of those people left anymore. That was true before the pandemic and is doubly true now.”

GM orientation: Because general managers are the ultimate decision makers at the property level, your RMS also needs to feel accessible and useful to them. “You’re asking GMs at limited-service properties to do things like configure overbooking by room type,” said Jennifer Schneider, vice president of revenue optimization for the Americas for Radisson Hotel Group. “It’s complicated, and the training is complicated. Now more than ever, we need a better way because of GM turnover.”

Profit optimization: Another trend that the pandemic has intensified is the shifting focus from revenue optimization to profit optimization as it’s become even more important that every dollar counts. “All of our Revenue Optimization Advisory Board meetings recently have revolved around profit optimization,” said Nicole Young, CRME, senior corporate director of global revenue management for Rosewood Hotel Group and chair of HSMAI’s Revenue Optimization Advisory Board. “It’s absolutely critical.”

Flexible reporting: In a turbulent, ever-changing environment, your RMS has to deliver centralized, accessible, easily digestible information to revenue and nonrevenue professionals alike. “With revenue managers overseeing more hotels and the increased scrutiny over what they need to stay on top of,” said Sean Lynch, vice president of revenue management for Graduate Hotels, “it is not sustainable to log in to six to seven separate systems to get the data — future market, competitive pricing, pricing recs, group data, etc. — to piece together what you want to do. There needs to be a single place for this data to reside.”

User experience: The consensus among the experts we talked to is that RMS platforms aren’t easy to use at a time when they really need to be. Things take too many clicks, implementation is too painful, and training is too hard. “We work in a hotel, right?” said Terence Sham, head of revenue management for Ace Hotels. “It shouldn’t be that complicated. If it’s that complicated, then it’s not that intuitive.”

Adapted from The New RMS: A Buying Guide, a white paper from HSMAI and Revenue Analytics.

Integrating Technology in a Post-COVID Marketplace

By Kathleen A. Cullen, Senior Vice President, PHG Consulting

Conducting rigorous benchmarking, preparing accurate projections, and developing a responsive new business mix — the pillars of sound revenue optimization and the foundation of a strong post-COVID business strategy — all are dependent on technology systems that are being used to their full potential. It’s in your hotel’s best interest to ensure that all system versions are up-to-date, that system integrations are implemented and working properly, and that each system is configured with the ideal optimization, understanding its impact on each of the related systems.

While hotel technology is still fragmented in that there are many systems for differing needs, it is important to understand that the configuration and use of each one affects the output and success of the others, and therefore the hotel’s optimization and profitability. For example, how your central reservation system (CRS) and property management system (PMS) are uniquely set up directly affects your revenue optimization processes — both manual and automated.

Here are some questions to consider as it relates to your revenue-related technology assessment:

  • Does the hotel have sufficient interfaces allowing technology to help in cost efficiencies?
  • Are these interfaces set up optimally? Or are there regular errors or translation challenges causing the team to constantly research and correct or find counterproductive workarounds?
  • If you have a revenue management system (RMS), have you reviewed the configuration and decision outputs since the COVID-19 outbreak, including:
  • Review the business rules that the RMS is currently using for decision output. The initial “rules” configured likely will be completely different based on the new landscape. Examples include but are not limited to lowest acceptable rates or “hurdle rates,” group ceilings, rooms-to-meeting-space ratios, and cost information.
  • Booking activity has completely changed since you originally set up your RMS. It’s wise to review the decision output to ensure the system is properly calibrating to these new conditions.
  • Does the hotel have an automated commission processor to ensure agencies get paid in a timely manner, and therefore have confidence in sending business to the hotel again?

Excerpted from New Rules to Be Market Ready, by Kathleen A. Cullen, a new white paper available from HSMAI and PHG Consulting. For additional information, insights, and tools, visit HSMAI’s Global Coronavirus Recovery Resources page.

Group Sales in a Post-COVID Marketplace

By Kathleen A. Cullen, Senior Vice President, PHG Consulting

The group sales landscape likely will be very different in the near to medium term. The entire world has watched meetings and events scheduled for the first half of 2020 either cancel or postpone to later in the year, or even move to 2021. The challenge is knowing the best time to rebook. Hotels will need to be agile in pivoting to whatever the new normal looks like.

Approach conversations with your group clients in a transparent and partner-like way, displaying a sense of togetherness, compassion, and care and offering significant flexibility. The following is a list of key items that group representatives are expecting from hotels:

  • Cancellation and cutoff dates may need to be reevaluated for the remainder of 2020 to provide more flexibility in decision timelines.
  • Attrition clauses may no longer be accepted. Hotels will need to think about what is more important — group business at 50 percent of expected size or no group at all?
  • F&B minimums may have to be removed.
  • Room-to-space ratio requirements should be reexamined.
  • Program designs will have to allow for more space between attendees. There may be fewer attendees but the same space requirement to allow for social distancing. Rounds initially planned for eight people may go to five. Think in advance about how to handle groups that are “space heavy” and have an “off-rooms-to-space ratio” in their ask.

Alleviate client concerns in advance by communicating measures your hotel is putting into place before the question is even asked. These groups selected your hotel based on certain services and staffing levels, so it will be important to provide them information on what they can expect now:

  • First, reassure clients that your hotel is open and ready to welcome their groups.
  • It will also be important to address your staffing and planning for groups. Many hotels were forced to furlough much, if not all, of their staff. A natural concern will be who is available to prepare and support clients in advance of their programs. Communicate that staffing — and plan in advance, so clients have confidence.
  • Communicate service adjustments you are putting into place. How will you handle buffet or food stations? Will there be a pass-through cost for these changes?
  • Offer floor plans showing new room setups with social spacing options.
  • Should every table have not just pads and pens but also sanitizer?
  • What about the financial stability of your hotel? A legitimate concern of some clients could be the liability of deposits and the solvency of the hotel. Perhaps reassure them by offering to put deposits into an escrow account.
  • Does your air-conditioning system circulate recycled air or fresh air? If your hotel has been closed for a period of time, the HVAC system should be inspected to ensure that it is free of contaminants.
  • What virtual capabilities and internet strength can you offer for attendees who participate remotely?
  • Communicate the cleaning process, including sharing videos about it. Perhaps offer to put cleaning solutions in the rooms for guests who want the added comfort and ability to do it themselves.

Hotels that alleviate concerns in advance of any questions will provide significant comfort to group clients and have the best chance to secure the business. Give clients what they need. It won’t be about rate — it will be about trust, care, and communication.

Excerpted from New Rules to Be Market Ready, by Kathleen A. Cullen, a new white paper available from HSMAI and PHG Consulting. For additional information, insights, and tools, visit HSMAI’s Global Coronavirus Recovery Resources page.


New Research on the Barriers and Pathways to Strategic Innovation

In preparing for HSMAI’s very first Curate event, held in April 2018, we surveyed sales, marketing, and revenue optimization professionals working at our Organizational Member companies about the main challenges facing the hospitality industry. They identified nine, including a lack of innovation — which Curate attendees then chose as one of three priority issues to focus on.

Since then, we’ve regularly focused on innovation as a topic, featuring speakers from inside and outside the industry at subsequent Curate events, interviewing the authors of relevant new books, and more. Our latest resource is a new HSMAI Special Report, Strategic Innovation in U.S. Hotel Companies, featuring original research conducted for us by Ecole hôtelière de Lausanne (EHL). As the industry pivots to recovery in the aftermath of the coronavirus pandemic, this Special Report offers valuable insights into the barriers and pathways to innovation, which will — or should — be a part of every hotel company’s strategy moving forward.

The report offers three key findings:

1. There is little strategic innovation: Innovation in hospitality sales, marketing, and revenue optimization (SMRO) is risk-averse, focused on the short term, and convoluted. It’s big on tactics but light on strategy.

2. Silo thinking impedes strategic innovation: Despite sharing common innovation challenges, there are few synergies across the SMRO disciplines.

3. The solution is personalization and data management: Predictive personalization by means of social media data emerges as the key innovation in data management strategy.

Read the full report to learn even more about strategic innovation as it is, isn’t, and might be practiced at U.S. hotel companies.

Planning for Hospitality Revenue Recovery

Let data guide your recovery plan. These questions should stay top of mind for you as your revenue strategy evolves:

Market demand: How has this changed today? What does this look like for each of the four stages of recovery? Forward-looking data, search volumes, and potential future demand peaks caused by the rescheduling of events and conferences are all good examples. Analyzing any and all data at your disposal will help you make more confident business decisions.

Feeder markets: Which markets are open now, and when are others indicating restrictions will be lifted? What segments and channels are still creating bookings? Take note of key dates for when the hotel and greater hospitality industry can operate.

Existing and new business: Are there any new potential customers to include in your scope? How many of your existing customers have rebooked? With demand down, now is the time to expand your reach and target as many potential bookings as possible.

Visibility: What are your competitors doing? Have they promoted discounts or launched new marketing messaging? Are there ways to break through the noise with your own distinct messaging?

By taking the pulse of the market and your current place in it, you can start to identify areas of improvement for your current revenue strategy to determine your most profitable business mix.

Excerpted from Planning for Hospitality Recovery – Revenue Management, a new playbook available from HSMAI and Amadeus. For additional information, insights, and tools, visit HSMAI’s Global Coronavirus Resources page.

Planning for Hospitality Marketing Recovery

How you interact with customers amid change and stressful situations can make or break your brand reputation. Studies indicate that consumers will remember how brands reacted during this time, creating trust that can lead to future bookings. To continue relationship building for each phase of recovery, you should:

  • Leverage your CRM and let your audience know any updated health and safety measures and that you are open for business. Maintain flexible cancellation policies as recovery continues, and include any specific offers (seasonal/holiday promotions, special events, etc.) to incite bookings.
  • Pay special attention to guests with upcoming bookings and communicate frequently with them. If possible, use surveys to understand any additional measures you can put in place to reassure them during their stay. Once they leave, send follow-up emails with offers rewarding their loyalty and links to surveys to assess their perception of your property from a health/sanitation and experience perspective.
  • Reach out to any guests or groups yet to rebook and think of ways that you could encourage them to repeat their business.

Excerpted from Planning for Hospitality Recovery – Marketing, a new resource guide available from HSMAI and Amadeus. For additional information, insights, and tools, visit HSMAI’s Global Coronavirus Resources page.

Planning for Hospitality Sales Recovery

During economic downturns, it’s more important than ever to keep your sales team motivated, engaged, and empowered as you navigate towards recovery. Reopening to your local markets and then to the broader market will put an emphasis on new skills and lines of communication. The following strategies will help you capture as much from the reopening process as possible:

Keep in touch. It’s critical to maintain regular communication with anyone that you may be hiring (or rehiring) soon. Even if they are not on-property yet, it’s essential to make your future colleagues feel valued and part of your business plan to move forward.

Invest in learning new skills. This recovery will demand new skills from your sales team. With such a sharp drop in demand and restrictions on physical meetings, the sales environment of the recovery will reward those who can prospect digitally. Provide training plans that will allow the team to develop the skills they need, such as digital relationship building, consultative selling, or software training. View this as an investment that will reward you as the market continues to build.

Formalize information sharing between sales and other teams. Sales teams need to be intimately familiar with new pricing strategies, technology investments, operational changes, and community developments. Formalize cross-functional communications between sales and the rest of the organization.

Position sales as intelligence collectors for the property. Sales teams are your eyes and ears into a changing world. Let your sales teams do what they are trained to do (building relationships, networking, and understanding customer needs), and elevate their insights to property decision makers.

Excerpted from Planning for Hospitality Recovery – Sales, a new resource guide available from HSMAI and Amadeus. For additional information, insights, and tools, visit HSMAI’s Global Coronavirus Resources page.

Planning for Hospitality Recovery – Sales, Marketing, Revenue Resource Guides

In partnership with Amadeus Hospitality, HSMAI is pleased to provide the industry with a series of Hospitality Recovery guides across three key functional areas – Sales, Marketing, and Revenue Management. Together, we interviewed global industry stakeholders, conducted market surveys, and pulled from our internal expertise to provide what we hope will be actionable guidance to jumpstart your organization’s recovery and reopening efforts.

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Marketing Content in the Post-COVID Marketplace

By Kathleen A. Cullen, Senior Vice President, PHG Consulting

Hotel marketers are already thinking about creative new campaigns to help capture travelers once coronavirus-related restrictions are lifted. Some hoteliers have continued communicating with guests to keep them informed of the hotel’s status and provide relevant, fun programming, while others are waiting until they get closer to reopening.

Marketing campaigns will have to be timed appropriately to ensure alignment with a consensus that it’s safe to travel again. Yes, consumers will be looking for deals, but more importantly, they will want hotels that provide them with a sense of health and cleanliness. Now is the time for marketers to review content on all channels and all forms of communication to ensure that it is being presented from an entirely new perspective:

  • Should your hotel consider a new section on its website that addresses healthy and safe business practices? Legal counsel should be considered.
  • Review hotel imagery through an entirely new lens. Should hotels start including images representing cleanliness or the sanitation process? Also, displaying groups of people close together may not be ideal to lead with anymore.
  • Are your reservation sales agents — onsite and call center — armed and ready to speak to safety, cleanliness, and spacing concerns?
  • Communicate how your hotel is transforming its physical spaces to accommodate more room in public areas.
  • Consider written content on all channels. Ensure that content on channels such as website, GDS, and OTAs represents the right descriptions of any new safety practices, change of services, and amenities.
  • Have the check-in and checkout processes been revised to allow less human interaction or touchpoints? If so, make sure that this is being communicated in all areas.

Excerpted from New Rules to Be Market Ready, by Kathleen A. Cullen, a new white paper available from HSMAI and PHG Consulting. For additional information, insights, and tools, visit HSMAI’s Global Coronavirus Resources page.