the transformation of the hotel industry from art to science
TRANSCRIPT
The Transformation of Hospitality from Art to Science
Robert A. Rauch, CHAHotelGuru.com
Factors of the Transition from Art to
Science
Revenue Management
Distribution Channel Management
Reputation Management
Social Media Marketing
Web 2.0
Revenue Management is the set of techniques that determine which
reservation request to accept and which to reject to optimize revenue
Hotel Pricing
Revenue Management
Manage OTAs
Packaging
Risk factors
Evolving traveler
Today, it is time for the industry to price based on value perception and
not just price relative to a competitor.
Understanding the true demand in a marketplace is quite scientific.
OTAs
GDS
Hotel Direct
Voice
Hotel Website
Social Media (the new
player)
Distribution Channel Management for Driving
New Revenue
Reputation ManagementTravelers’ ability to access social networks anytime, anywhere
empowers them to create and consume more content than ever before
70% of travelers make decisions based on reviews and responses on review sites.
Photo: hospitalityformulaconsulting.com
Social Media• Capitalize on guest created content
• Create a virtual concierge through the property’s website or other digital app
• Implement concise and impactful videos to enhance dramatic imagery
• Utilize content marketing and real-time marketing
90% of travelers trust recommendations from their friends and family more than any
advertising
Consumer BehaviorA = B x W x N
A- Attitude toward the business
B- Belief of a consumer that the business possesses
a particular desirable attribute
W- Weight of importance of the attribute to the
consumer
N- Number of attributes important to consumers
Science of Marketing
• Digital marketing• Mobile• Real time marketing
Digital MarketingDigital marketing is the use of digital sources based on electronic signals like Internet, digital display advertising and other digital media such as television and radio.
Mobile
47% of travelers research options using their mobile device
31.6% will actually book their travel on a mobile device
Photo:Marriott.com
Mobile is the new “walk-in”
Real Time Marketing Real time marketing (RTM) isn’t planned, it just
happens
NASA’s Tweet During the Oscars Oreo’s Tweet during the Super Bowl
Utilize Facebook apps to highlight unique features
Feature guest generated content Guest should be able to communicate with
property Video campaigns generate guest engagement
Real Time Marketing
Millennials
Expectation of more international
visitors
Booking more profitable business
Innovative technology
Sharing economy/Disruption
Today’s Top Hospitality Trends
Party for one, but hanging out together Fastest growing segment Special designs with Millennials in
mind Will turn to social media to voice
opinion Lack loyalty
Millennials
Photo from Nytimes.com
Chinese Travelers 2015 and Beyond
Visa Waiver Program
Longer stays
Spend more money
Mandarin Chinese is the most spoken
language in the world
Booking more profitable business
• Improve distribution channel mix• Less reliance on relationships with OTAs• Content is King• Provide WOW customer service
Photo: investingtrack.com
Copyright 2015 R.A .Rauch & Associates
Threat of New Entrants
Bargaining Power
of Buyers
Bargaining Power
of Suppliers
Threat of Substitute Products
RivalryAmongExistingFirms
PORTER’S FIVE FORCES
The hospitality industry is no longer an Art,
are your strategies in line with hospitality as a science?
Read more on the transition of the hospitality
industry from an art to a science here
Thank You
@truehotelguru
HotelGuru.com
CEO, RAR Hospitality