Weathering the storm with online special offers

Hoteliers should be focusing their efforts on offering competitive deals in order to try to restore tumbling numbers of bookings, says the findings of a study by Filmbank and RBI Insights.

The recession may be hitting hoteliers hard, but by implementing a range of “special offers” to attract customers can help to increase the number of reservations, even during periods of economic uncertainty, the study concludes.

Although 50% of surveyed hoteliers said added-value promotions such as in-room meal-deals and spa packages were highly attractive to customers, the most successful way to increase the number of reservations is to offer special deals on room rates or for extra nights stayed.

RateTiger agrees and sees this as the one way to ensure that occupancy and revenue is maximised without slashing rates unnecessarily and devaluing the brand. Experimenting with offers can help revenue to remain buoyant and for the hotel to maintain, if not improve, its market share. However, one has to be careful with the amount of Special Offers being promoted. Any such offering should be limited in scope and time to ensure that brand values are not being derailed.

With an increasing number of customers moving online to find the best deals, hoteliers can reap the full benefit from this changing trend by reflecting their special offers across their distribution channels, rather than just relying on the more traditional GDS and CRS for their business.

But to effectively sell online, hoteliers need to have the right tools in place. Without full control over rates and availability, hoteliers will find that the effect on their revenue and occupancy is limited. Without the help of appropriate tools, offers can often not even be posted online on time to gain the most value and return.

There’s no doubt that the current economic slowdown has affected the number of reservations, but it’s not all doom and gloom; there’s still a huge number of people wanting or needing to stay in a hotel every day. What is needed is a clear pricing strategy, which incorporates enticing special offers smartly as well as the ability to implement it across multiple distribution channels to capture the customers looking to snatch a good deal.

University Hoteliers Conference, 2009

The third edition of University Hoteliers Conference took place on 28th April 2009 at the Universidad Rey Juan Carlos in Madrid, Spain. The conference was focused on the application of technologies in the hotel sector and was broadcast online by CanalTur.

Discussions at the event revolved around innovation in marketing and distribution with presentations and roundtable sessions on the role of online distribution, its threats and opportunities as well as benefits of online marketing and revenue management.

Pilar Sanchez Aita , RateTiger Sales Manager, Spain shared a presentation focusing on the evolution of Online Distribution and how the hoteliers should tackle challenges to meet consumer expectations. She also discussed the importance of maximizing visibility and revenue through channel management.

From what Pilar tells us, here is a brief overview of the event and various presentations.

“It was an excellent turnout with representatives from Google, TripAdvisor, Room Mate Hotels, Sol Meliá, Starwood Hotels, Vincci Hoteles and ITH, among others, speaking on various related topics. Google shared helpful insights on the current scenario and its effect on the hospitality sector. They also presented some solutions to hoteliers like increasing distribution agreements with more channels to attempt getting more occupancy.

“TripAdvisor introduced attendees to the world of social networking relating to the sector. They remarked on the importance of consumers’ opinion about hotel chains, restaurants and attractions, not only through friends but also through the feedback and perceptions of other consumers who have experienced the services.”

Room Mate Hotels shared their simple revenue strategy and rate structure. Their representative emphasised the importance of constantly reviewing and updating online distribution channels. They also talked about the benefits of cross selling and brand management. Vincci Hoteles presented their online strategy – the promotions and packages they manage through their booking engine and also mentioned how they have improved their online revenue by using RateTiger applications.

Sol Meliá presented a debate on ‘price cannibalisation’ versus ‘strategic planning, human resources training, clear processes and tools for distribution’. “This was an interesting session as it talked about the price war that has started in the industry which is a loss-loss situation for all involved hoteliers.” Sol Melia stressed the need to develop sensible revenue management strategies to forecast rates, proper market segmentation based on product – price mix and effective use of KPIs (key performance indicators).

Starwood Hotels pointed out the relevance of hotel sales, marketing and revenue management departments to work cohesively. They are aiming to develop a tool for proper rate forecast for their properties and they aspire to prepare a revenue management process to manage group, F&B as well as room rates.

The conference was jointly sponsored by RateTiger, ITH and Hosteltur.

BuyTourismOnline Light, 2009

BuyTourismOnline recently organized a toned down edition of its main event calling it BTO Light on 6th and 7th April 2009 in Florence, Italy. The conference was focused on “How to maximize sales on the internet market?

Hoteliers, Sales & Revenue Managers & technology companies attended the two day conference in good numbers and obviously their main concern was to understand how to improve their sale through new market strategies. Sascha Hausmann, RateTiger COO, shared a presentation on “The online distribution in the new millennium” for attendees to understand the growing importance of revenue and channel management. With increasing focus on online distribution of inventory, hotels need to make the most of this marketing channel to gain occupancy and maximize revenue. He also focused upon the convenience of having a unique interface for managing various online channels and systems. Hoteliers were also interested in learning more about ‘Web 2.0’. Among the speakers were RateTiger, TripAdvisor, Expedia and Google among others, and all the companies laid stress on technology and the hotelier’s new needs.

“It turned out to be an interesting conference,” says Giuseppe Messina, RateTiger Sales Manager for the region. “This kind of conference is needed in Italy. Hotels are happy about the conference, and personally speaking, I think it is a good idea to refresh hoteliers after the main exhibition (which took place in November ’08), just to increase the interest about technology. I’m sure the next BTO in November’09 will be an even bigger success.”

Enzo Aita (RateTiger SM, Italy) who attended the show with him discussed with us his activities: “Apart from the online sales tools, other important features include Hotel reviews and the importance for hoteliers to be ready to react to positive and negative reviews. I got a feeling that all this innovation and new services has left the hoteliers confused, as they often do not have much knowledge on the subject. Now when they are faced with various choices that are not within their competence, they often buy technology products based on price benefit and not by the quality of service.”

All in all, it was a conference worth attending. Most of the attendees were from North Italy and hence it provided RateTiger with an opportunity to interact with a very specific market segment. Enzo and Giuseppe surely had a good time discussing RateTiger’s new products RTStrategy and RTChannelManager Plus with hoteliers who wanted to see a demonstration of the product, and our Sales Managers obliged by showing them one!

Turismo Comunidad Valenciana 2009

The city of Valencia in Spain recently organized its fifth International Tourism Exhibition – Turismo Comunidad Valenciana from 3rd – 5th April’09.

The exhibition acts as a meeting place for tour operators, carrier companies, hotels, service providers, etc from across Spain as well as internationally. The event showcases major businesses and institutions directly involved in the tourism industry.

RateTiger’s representative Cristina Hernández (Sales Manager, Spain) checked out the event. She compares it with last year’s show and mentions the fall in the number of exhibitors as well as attendees this year.

When asked about the constitution of attendees, Cristina says, “There were representatives from institutions, travel agents, smaller Spanish regions and few hotels from the rural areas. The exhibition focuses more on the end consumer i.e. the general public, providing them an opportunity to check out services and products of various public and private companies, institutions and agents.”

She further mentions – “It is a very young trade fair and given the current economic situation, hotels /chains were not exhibiting. Many companies preferred to give it a miss. It is not a place for B2B meetings which was how it was promoted.”

INTERNORGA, Hamburg, 2009

If you would ask a German about the annual event for the hospitality industry with the longest tradition, the answer would be INTERNORGA, which celebrated its 83rd anniversary in 2009. One of Europe’s biggest trade fair of its kind, based in Germany’s trade metropolis Hamburg, is year after year a must for hospitality suppliers.

This year’s INTERNORGA took place 13-18 March, and with 87,000 square meters of exhibition space it was larger than ever before. 103,000 trade visitors were attracted by 1,050 exhibitors. However, RateTiger was not amongst these exhibitors as INTERNORGA has a strong focus on the catering and restaurant/bar industry. Only approximately 16% of its visitors work in the hotel business, and most of them are rather concerned with choosing new cutlery or a convection oven than revenue or channel management software.

Nonetheless, RateTiger’s German PR representative Jasmin Keller spent a day at this busy event and met a number of press contacts. Her impression: “It is indeed a massive event! Yet you will probably not find many buyers for channel management software.” Asked whether INTERNORGA was hence a less important event: “Not at all! All our key media contacts are present to promote their publications as well as to learn about new products. It’s a perfect way to meet up with everyone!”

A need to create awareness for the necessity of a strategic approach to the online market is the common outcome of her meetings. The editors agreed that it is vital for hotelier’s future success to learn about the importance of the Internet as a point of sale. “Many hoteliers are still skeptical about using third party distribution sites or cannot afford the time to update these extranets properly,” said Jasmin. “The editors are aware that those must be educated: about the opportunities for their business; the risk they take by not participating on this market; the best ways to manage the web strategically; the need for continuous benchmarking and updating; and the possibilities to safe time and maximize revenue with supportive software solutions, such as RateTiger.”

Overall INTERNORGA has been a success for RateTiger, with several editors planning to pick up on channel management. The company’s claim of being not only a software vendor but also to focus on education, training and consultancy has proved to be the right strategy.

RateTiger at ITB 2009

What happened? Last thing you know is that the economy is expecting a horrible year and next thing you hear is that the organizers of ITB 2009, Berlin, Germany, reported an increase in attendees as many tradeshows across the world experienced a fall in visitors.

RateTiger attended with its own stand in the technology section (Hall 8.1). We returned with a similar stand design as WTM 2008 to reinforce our position as a leader in the online channel management industry.

As European Seal of e-Excellence awards winners in marketing of innovation RateTiger received significant interest from visitors especially with our luxurious discounts and offers to celebrate our award win.

International and German hotel companies had their brand presence but the number of people representing chains were down from last year. The key concerns for hoteliers seemed to be that the future is uncertain in relation to the economic downturn. The feedback we received was that hotels are looking at more distribution channels while expecting much quicker returns.This was extremely prevalent among clients in the Asian Market. As a natural consequence, the time spent on channel management has and will increase significantly hence the extreme interest in our products.

Sunaina Jagtiani, UK Sales Manager commented: “The great thing about the show is that I got the opportunity to speak with the decision maker or the influencer with regards to online channel management and sales. I met with several potential clients in the Asian market and Sudhir our APAC SM will be following up on those leads.”

Keith Povah, Director of Sales said: “The sales managers found some clients were a little hesitant to invest in software as there are so many dreadful stories about technology companies going under. Being present at the show showed potential clients RateTiger’s strength and stability with our commitment to deliver and also gave us the ability to provide insight into why channel managers save time and make money”

Hoteliers were keen to discuss current needs and how RateTiger would best solve those. Furthermore, a big part of the discussions were about the newly launched products RTStrategy and RTCorp, first available during ITB 2009. The feedback from customers makes us believe that both products hit market needs.

Ulf Guldi, German Sales Manager, his first exhibition as part of the RateTiger team: “I must say the show was great. I have attended quite a few ITB’s in my travel industry history, but I never had so many qualified meetings. We definitely achieved a lot of success from the show and numerous interesting and hot leads from single hotels and smaller hotel groups.”

There was a constant buzz on the RateTiger stand and we have some big announcements to be made in the coming weeks following partnerships we secured with leading vendors and hotel groups.

Florida Huddle 2009

We attended the Florida Huddle to meet with hotels and discuss opportunities to expand sales and marketing online through third party distribution channels.

Over 230 hotels attended the event and we were fortunate to arrange meetings with over a third of them. The team helped them identify ways to maximize the distribution of rates and rooms across the internet.

Siobhan and Gerard managed to secure a few sales and many leads for hotels and wholesalers. Doubletree Universal has also been referring RateTiger after the event.

Hoteliers were keen to understand more about technology and the online environment as they have manually managed their multiple channels for the past few years. The trend continued that many are worried over how the current economic situation will affect their business over the next 18 months and are looking at all options in an effort to remain competitive across many channels while reducing cost and time spent.

Hopefully by the time we attend HITEC in June many hoteliers will see what they can achieve through streamlining their sales online through channel management systems.

BIT, Milan, 2009

The global economic markets hit BIT 2009 in Milan hard this year. Italy seems to be suffering more than any other country; RateTiger has been to many tradeshows which reported an increase in attendance. However BIT lost 25% of attendees on 2008.

Our sales managers experienced an atmosphere full of pessimism and lack of motivation from many exhibitors and visitors. Giuseppe Messina, SM in Italy said: “I can tell you that the mood was a bit down. I had the chance to talk with hotel managers coming from Florence, Venice and Rome, and they are all in the same scenario: 25-30% of occupation compared to 2008.”

Due to our position in the market hoteliers were keen to talk about RateTiger and online distribution in general. Stand visitors were interested in a product like RTChannelManager but still worried about increasing outgoings until they began to see a greater return in online channels.

Enzo Aita, SM in Italy, was surprised that some of the big players did not turn up: “Hotelplan and Italian TO (Alpitour, Francorosso, etc) did not come as exhibitors – I was very surprised by this.”

We hope the Italian market will begin to pick up over the next few months. RateTiger will be launching soon a product that will assist smaller hoteliers to maximize rates and distribution online while helping tight budgets.

HSMA – eMarketing Day, Frankfurt, Germany

We were invited to speak at the HSMA conference on February 11th in Germany by the HSMA, IFH in connection with the German Hotel Association (IHA) as key sponsors of the event. The entire day was dedicated to electronic marketing and how to make the best out of internet marketing opportunities.

During the morning we listened to representatives from Google describing marketing opportunities for travel companies; Lufthansa showing how airlines manage passengers and use the internet to ease procedures; Micros-Fidelio talking about integrated e-commerce solutions; as well as, various consulting companies presenting how the internet and web 2.0 provide opportunities and challenges.

In the afternoon the crowd of approximately 180 people was able to select from various workshops that would allow for deeper inside info. For example newsletter marketing, search-engine-optimization, legal aspects of web 2.0, RFP procedures as well as integrated revenue management and distribution systems.

We were asked to talk about Metasearch and Channel management – the balance between customer and hotel. During the workshop we established what channel management and metasearch are, how they influence consumer & hotel behaviour and how they are going to develop in the near future. As I love to show the hotel world how inconsistency is transparent on the web, we also walked through an example of why it is important to manage rates & availability properly. I managed to find a hotel during my research for the workshop that had different rates on different travel metasearches and even within the same search engine! I am sure that revenue was lost there…

After the workshops the organizers presented a panel discussion between Trivago, Holidaycheck, Choice Hotels and Romantik Hotels about Hotel-Review-Platforms. To my surprise, the audience was very switched on and engaged…. even at 6pm.

Overall the event was well received. The organizers could have done improved with some of the presenters though. When you present at a nearly 200 people event, you have to make sure your presentation is sharp, informative and interesting enough to follow along. That wasn’t always the case for some…..