Originally published on PhocusWire
The travel industry is facing unprecedented challenges. Hotels are struggling with falling occupancy rates, while travelers are canceling trips to increase social distancing. Everyone is asking the same question: “What can I do to get through this?”
In times of uncertainty, it’s critical for hoteliers to focus on building trust with customers and future guests through compassion and flexibility. Read our 5 strategies for maintaining critical guest relationships and keeping your overall revenue strategy intact.
Take an honest look at your market
- How is my comp set reacting?
- Who is changing their rates and by how much?
- Are competitors shifting their distribution strategy in obvious ways?
- Are hotels around me closing and for how long?
- What is my comp set sharing with their guests about their operational procedures?
Ask these questions regularly to evaluate your local market, then you can naturally start to shift your focus towards sustainability and recovery. The first step you should take is reworking your cancellation policy if you haven’t already.
Flex your cancellation policy
Many airlines have announced their commitment to customer wellbeing by waiving cancellation and change fees in the event travel plans must be delayed. Act similarly by creating a cancellation or rate plan that has this same flexibility, in addition to your advance purchase rate plans.
Give future guests the ability to switch their reservations to a later date, but don’t wait for them to contact you. Proactively reach out to them to keep them from outright canceling trips. This mentality applies to group business too.
For group cancellations or changes:
- Are groups looking to rebook for later dates?
- Have you considered turning canceled group bookings into credit for a future date to entice them to keep their business with you?
Any cancellation or re-booking communications you send should also be treated as an opportunity to show your compassion. Think about meaningful ways to:
- Show sympathy towards their decision to cancel.
- Emphasize your concern for their health.
- Create loyalty by offering to turn the canceled reservation into credit for a later stay.
Flexibility and understanding are what will help your property stand out in the market and bolster your brand reputation. However, before communicating anything to your guests you should inform staff about changes in policy. Make sure they have the right resources available to reference so they can engage with guests in the right way.
Support your call center and reservations staff
Provide guidance to other departments about operational changes that will impact current and future guests. Turn this information into an FAQ document or resource center for staff to have quick access to answer additional guest questions such as:
- What if I want to change my reservation, or cancel my reservation?
- What if I am canceling my reservation beyond the cancellation refund window?
- What are you doing to ramp up safety and security at the hotel?
- Are there any changes in hours of operation for services like housekeeping, or the front desk?
- What are your guest room cleaning procedures?
- What are you doing to ensure cleanliness in public areas?
- What facilities or F&B outlets will I still have access to at the property?
- Can I check-in or check-out without going to the front desk?
Engage with call center staff frequently to understand any changes in guest sentiment and do everything you can to empower them with praise for their hard work through this uncertain time. As your line-level staff handles the situation at hand, you can also mitigate inbound calls and questions by putting this vital information on your website.
Put your operational procedures and any changes center stage on your website
Take a page directly from major airlines by fostering customer confidence through effective marketing. Remove any doubt about your brand by sharing critical updates on your homepage such as:
- Public area cleaning procedures
- Guest room cleaning procedures
- Any changes in the check-in and check-out experience
- Cancellation and re-booking policy changes
- Safety and security program and procedure descriptions
- Links to state, local, and business partner resources that may also be of help
- Changes in hours of operation or accessibility
Honesty and transparency are the best policies to build trust with your guests. Sharing how you are supporting both your staff and your guests will show that you are prepared and ready for anything. Once you have addressed the “here and now”, take an honest look at your rates and booking channel strategies for the long term.
Guard your rates and shift booking channels
One common reaction in times of crisis is to dramatically reduce your hotel’s average daily rate (ADR) to boost near-term revenue. While dropping ADR may be a temporary solution, it can take twice as long to recover from. During periods of economic downturn rate parity can become an issue as well, so it’s important to track rates closely across channels and take actions as necessary. Combine this with focused efforts to shift bookings towards Brand.com to help weather the revenue management storm.
- First and foremost, make sure you are being flexible and offering special rates to any first responders (healthcare, law enforcement, etc.) that may be traveling to your city.
- Look at what your comp set is doing and make slight adjustments to your ADR to stay competitive and remain flexible.
- Ensure that Brand.com rates meet or beat the competition on metasearch by examining rate parity metrics, diagnosing the internal or external causes of disparity, and taking appropriate action to resolve them.
When you feel confident in your long-term rate strategy, begin to proactively address the future by identifying steps for recovery once things are back to normal.
Develop a recovery strategy
When the travel and hospitality industries stabilize, how are you going to regain revenue momentum? Take some time to think about your revenue recovery goals and consider the following:
- When the world moves on from this crisis, travelers are going to behave differently. Start thinking about how you are going to adapt your offerings to these new behaviors. One of the first groups of people that are going to immediately start traveling again are business travelers. Stay connected with top accounts both transient and group based. Keep building the relationships and trust with each account and stay top of mind so that you are the trusted partner to work with once travel recovers.
- A lot of transient guests are also going to want to re-book vacations and special events once the crisis has passed. Take time to think about how you will reconnect with people who canceled and promote more personalized experiences. Offering special packages could go a long way, and loyalty is going to become critical to keep revenue strong while the market recovers.
- Many locals in your area are going to be spending more time at home than they normally do and will soon be looking for ways to get out of the house when it is safe to travel again. For anyone that may be initially hesitant to travel too far from home, think of new ways to offer experiences and stays that appeal to people within a short drive. Leveraging geotargeted media and ads can help ensure you are targeting the right audience.
- Plan to circle back with groups that canceled and have not yet rebooked to secure their business.
- Stay in the know with city-wide events, activities, and conferences for when they start to rebook.
Having the right long-term recovery strategy prepared means having the right level of confidence in your future. Focus on sustainability and remain at the ready to make any adjustments that keep you competitive and flexible. Contact us today if you need help maximizing your revenue strategy or have any questions about how to manage your future goals.