Hotel Blog and Management Tips - Ideas for Hoteliers - by Xotels

2011 Top 10 Revenue Management Blog Posts

info@RShotelS.com (Administrator) — Mon, 23 Jan 2012 23:00:00 +0000

In 2011 we took our hotel revenue management and marketing blog to the next level. We launched a new design and layout an integrated FaceBook comments plus social bookmarking buttons (FB Like, Google +, Tweet & LinkedIn Share). It created a whole new dynamics and increased the interaction with our fans.

Here the Top 10 most popular revenue management blog posts of 2011 :

Quite a nice list of interesting reads, full of ongoing discussions through FaceBook comments.

And to top it all of, here our FREE Revenue Management eBook.

Hope you to see even more feedback and discussions in the comments section in 2012 :)

Cheers,

Patrick @ Xotels

Xotels Reports 20% REVPAR Growth in 2011

info@RShotelS.com (Administrator) — Fri, 20 Jan 2012 23:00:00 +0000

Xotels reports a 20% growth in REVPAR, after a very strong 4th Quarter. It manages a portfolio of independent hotels with its team of revenue management and distribution experts. With its proven yield and distribution techniques it has become a driving force of change in hotel asset management in a short period.

Remko West, co-founder and COO of Xotels comment, ‘2011 has been an amazing year. We really managed to outperform growth trends in many of our markets. Not just city hotels, but also in resort destination we delivered an annual REVPAR growth of over 15%. In the 4th quarter, which is always a challenge in many markets we were able to penetrate certain market segments, improving our ARI and RGI's significantly.’

Patrick Landman, co-founder and CEO of Xotels adds, ‘20% REVPAR growth is an amazing achievement. We are very excited that with our team of revenue managers we have been able to deliver such results to our portfolio of independent hotels. Our Rent a Revenue Manager concept is a new trend in hotel asset management. Hotels need to become more professional when it comes to online marketing, distribution and yield strategies. And if they do not have or cannot find the resources internally they have to bring in experts to help them achieve a healthy ROI on their real estate investment.’

Here an overview of some our 2011 hotel REVPAR results:

Hotel	2011 YTD
Pantone Hotel - Brussels, Belgium	+23%
Theater Hotel - Brussels, Belgium	+37%
Qbic Hotel - Amsterdam, the Netherlands	+21%
Townhouse Hotel - Maastricht, the Netherlands	+18%
Hip Hotel St Martenslane - Maastricht, the Netherlands	+15%
Hotel Es Moli - Deía, Mallorca, Spain	+18%
Hotel de Londres - San Sebastian, Spain	+15%
Grand Hotel Teguise Playa - Lazarote, Spain	+18%

‘2012 will be a very exciting year for us. We have grown the REVPAR results of some these hotels with large numbers during several years already. However we still see opportunity for growth. We are already outperforming last year results for the month of January in some of the hotels.’, Remko West notes.

‘This year we are really working on growing our hotel management portfolio strategically. We are in discussions with some interesting properties in the Hague, Amsterdam and Berlin. We are also exploring opportunities in Abu Dhabi and other destinations in the Middle East, and have engaged into conversations in the Asia Pacific region as well. Our next new property opening will be the all-suite Rimondi Grand Resort in Crete in June of 2012. We are looking for unique properties worldwide for which we can help investors to take them to the next level in terms of revenue potential.’ Patrick Landman ends.

For more information, click here: hotel management company

Order Takers vs. Personalized Sales. How Effective is Your Hotel Selling over the Phone?

info@RShotelS.com (Administrator) — Wed, 11 Jan 2012 23:00:00 +0000

Do you know what the conversion % is of your hotel's reservations department? We seem to put a lot of focus on our website conversion statistics, but how many calls are we actually converting in to bookings. Phone sales is a very important direct sales channel for hotels, consumers are making the effort to contact you directly, and should be easy to convert. Why is it though that many hotels have such a poor sales process? Is hotel management not on the ball ?

It seems perhaps we have lost focus with all the developments of the internet. I would dare to argue this is not true. Reservations departments have for many years already been regarded as an operational department rather than a commercial one.

Backing up my rant of this apparent disinterest to generate direct sales we have done some test calls to various hotels in different cities. But I did not want to publicly emberass anyone so decided to cut our the hotel and agent name.

These guys we just heard only quote prices when I called. They did not even react to my buying signals and motivation for the trip.

So what do we want the image of our hotel to be about? What do we think will make consumers decide to book our hotel? Price? Or, a personalized sales pitch?

This one was trying, but it seemed she was mumbling. I could simply not make out what she was saying. Unfortunately they did not get me to book.

And here a really shameful situation, an agent referring me back to the website...

In this particular case the hotel’s management was under the impression the hotel was performing on target as the correct average rate per person was achieved. Unfortunately the average occupancy per person per room was actually 20% lower than normal, which made it impossible to reach total revenue target, because the average room rate was totally off.

Hotels have to train their reservations staff to go beyond the price quoting order taking approach. We have to implement a sales process we can customize to the individual caller to make it feel more personal.

We need to sell the destination plus location and surroundings of the hotel. Address the caller by his name. Ask questions to find out why he is traveling so we can better assist him in his needs. Call center agents have to be aware of what is going on in town and be able to give some recommendations on restaurants, public transport and activities.

Below an overview of a possible sales script you can use to increase the conversion of your reservations call center.

Task	Comments
1. Answer within 3 rings
2. My Hotel Reservations Greeting	“Good [Morning, Afternoon, or Evening], My Hotel reservations. [Insert Name] speaking!” Note: caller ID to determine language
3. Listen to the Caller’s request!	A. Redirect call, if applicable B. Process change request, if applicable C. Begin reservation process
4. Search for availability on the requested nights	Ensure to obtain the following information: • Arrival Date • Length of Stay/ Departure date • Number of people/ rooms If the hotel has availability, restate the arrival and departure dates (confirming the day of the week) and proceed to 5. If the Hotel is not available, suggest days surrounding the anticipated arrival date when the Hotel does have availability. If you cannot accommodate the Caller, place the Caller on the Hotel’s waitlist or refer the Caller to another PANTONE property. Only when the Caller asks you to recommend an alternative hotel, should you do so. Always thank the Caller for calling. Note: Never refer the guest to another distribution channel (wholesalers, travel agency, etc.)
5. Have you stayed with us before?	If “No”, goto 6. If “Yes”, goto 9.
6. Are you traveling on business or pleasure?	If “Business”, ask the Caller which company he/she works for. Proceed to 7; however, while you are describing the Hotel, lookup the Caller’s employer to link the reservation to the company profile. If “Pleasure”, go to 8. Note: This question is asked so that we can customize our sales methodology to the Caller’s needs.
7. My Hotel Overview-Business	Explain the Hotel's concept. (mention real business USP’s) Location (Proximity to transportation, offices, restaurant areas, business district) Facilities (Food and Beverage, congress, fitness, parking, restaurant space, more) Room overview (emphasize special amenities for business travelers,) Go to 11
8. My Hotel Overview-Leisure	Explain the Hotel's concept. (mention real leisure USP’s) Location (proximity to transportation and attractions) Facilities (Food and Beverage, restaurant, fitness, parking) Room overview (emphasize leisure related amenities) Go to 11
9. Obtain the guest’s name	“Great! Welcome back! May I have your last name so that I can find your details immediately?”
10. Search guest history	Use the guest’s name throughout the remainder of the sales process (at least 3 times)
11. Guestrooms- (Its Showtime) Sell, Sell, Sell…	Repeat Guest Scan guest history and confirm address and personal details. Option 1: “I have a ‘room type’ available at a rate of [insert price]. Note: In response to rate resistance, highlight the Hotel’s limited availability and restate the fact that the rate that you quoted was the best rate available. If applicable, note that availability is limited due to citywide demand (cite the event/reason). Never use the terms “cheaper”, “inexpensive”, etc. And never apologize for a price- the price is right. Mention that the rate is the best available rate at this moment. You can’t guarantee the same rate to be available in the future. If more bookings are made the rate might move up. Upon further resistance, suggest alternative dates where other price offers are available. Converting a booking and selling is easier when you give the guest psychological reasons not to wait with booking a room.
12. Convert the call	Option 1: “Would you like to confirm the reservation?” Option 2: “May I book the reservation for you?”
13. Process the reservation	Enter data in all required fields, including the company name (even if the company does not have an account with the PANTONE hotel). Reconfirm details (including the spelling of the guest’s last name), advise the guest of the Hotel’s cancellation and change policy, arrival and departure times, as well as early departure fees, and issue a confirmation number.
14. Close	Ask the caller if there’s anything else you can assist them with. Send confirmation letter (useful links for what to do in the city, public transportation, taxi services etc.) Thank the Caller and let them know that we look forward to their return/arrival.”

Here a schematic overview of the sales process for hotel reservations:

This is not something that it is implemented overnight. It requires many hours of training, creative brain storming and constant motivation to keep it up. We highly recommend implementing a mystery calling program, with test calls, scoring cards, following up coaching, and all tied into an incentive program.

Importantly, we should not to forget to measure the financial results. We need to track the success of each agent and the departments as a whole. Do you know who your best selling agent is? We need to develop some KPI on how to measure the success and impact of our reservation office.

2012 Hotel Industry Outlook : A Distribution Shuffle

info@RShotelS.com (Administrator) — Mon, 19 Dec 2011 23:00:00 +0000

Yes 2012 will be all about distribution in the hotel industry. There are some major developments that demand attention of hoteliers in order to stay in control of the market mix and distribution cost. Here some of the hot topics of next year: Google Hotel Finder, Meta-Search and Rate Parity, OTA Commission Levels, Direct Sales …

Many things are going on at the moment and it’s hard to figure out where to start. A major development that will most certainly impact the balance of the distribution world is the launch of Google Hotel Finder. Google has developed its own meta-search (price comparison) tool as a counter move to Bing’s acquisition of Farecast now called Bing Travel. It’s funny no ... ? How everyone is throwing a fit over Google entering into the travel meta-search market, but we seem to have forgotten about Bing Travel.

Google Hotel Finder
In any case recently Google has started testing with displaying Google Hotel Finder ads above the regular Google Ads. Of course this is causing mayhem and concern in the industry. They are effectively out-maneuvering meta-search sites like HotelsCombined, Kayak and Trivago with one simple step. Google Hotel Finder of course compares rates from major OTA which are paying heavily to show up there. So no, the OTA won’t lose out in volume, one could rather conclude that in the initial stages it will be a consolidation of volume to the larger OTA, until Google has integrated also more regional and local channels.

What impact does this have on hotels? There are different angles here. First of all, Location has just become even more important. Is your hotel situated within the preset parameters of your market according to Google Hotel Finder. For New York, London and Paris the settings seemed quite all-encompassing, but for Amsterdam Google Hotel Finder somehow is zoomed in to the city center, ruling out hotels in the surrounding areas in the pre-set search.

A quick tip for hotel investors, make sure your new hotels are within the zone …

So what else should hotels consider when it comes to Google Hotel Finder? The big thing brought to us by TripAdvisor : Reviews. Google over the last few years has started collecting initially reviews from other websites to determine popularity and value of your hotel property. Moreover it has been collecting guest reviews also through Google Places (formerly known as Google Local Business Center). A mix of all the reviews determines your user rating by which consumers can also sort the hotels.

As to be suspected the reviews which are shown on the hotel page are only the ones from Google Places. For the other sites there is a smaller reference at the bottom of your hotel listing with the number of reviews. Google does not even show a score for these other websites, which is something we admire from Trivago’s hotel listings.

Yes ladies and gentlemen hoteliers Google is on a mission to build the undisputed platform for travel search. It will use other sides for as long as it needs to get its own initiatives sufficiently of the ground and will then move them into the background.

So in your efforts to gain traveler reviews and good guest scores we have to look beyond TripAdvisor, Oyster, Zoover, Vinivi, HolidayWatchDog, VirtualTourist, Yelp, etc. Google Places and Google Hotel Finder have overnight gained huge significance when it comes to hotel reviews.

Just imagine the impact on your demand and sales when Google launches Hotel Finder into pole position for all hotel searches worldwide if you are listed as #1 on the preset sort order like Hotel de Londres in San Sebastian.

Google will show not only OTA, but also GDS Rep companies are listed, giving you a chance to get the reservation through lest costly and preferred channels. You will have to press your GDS representation company to develop an interface with Google Hotel Finder. Moreover it lists your hotel website URL. See the example below of the Plaza Athenee Hotel in New York.

Of course listing your website URL and phone number is free right now through Google Places, but we would not be surprised of Google would start charging hotel for this in the near future. In any case it is very important to have your account set-up well in Google Places as it will help your hotel as well to show in Google Universal Search results. Google Maps.

Below a screen shot for the search ‘Boutique Hotel Brussels’ where you see the Theather Hotel , a small independent property, popping up:

Meta-Search & Rate Parity
Many hotels are trying to maintain a rate parity strategy on OTA to level the playing field and create transparency for consumers. However these efforts are being completely torpedoed by wholesalers publishing net rates at low mark-ups online. We see wholesalers distributing package rates and net rates at low mark-ups directly and through affiliates that are listed on meta-search sites like Kayak, Trivago and HotelsCombined. Here a random date for the London market on Trivago:

Hotels need to make sure they have their distribution well under control across all channels, online and offline. Wholesalers are great channels, but hotels have to impose rules on the low net rates they offer and enforce them strictly, otherwise a strategy of rate parity might just be counter effective. Don't alow your offline rates to get online!

Increasing Commissions & Cost of Distribution
Another challenge hotels will be faced with in 2012 is the increasing cost of distribution. Quite a few OTA’s have raised their commissions from 12% to 15% in major destinations, which represents a 25% increase in cost by the way, and will come straight your hotel's bottom line. Many OTA also have launched preferred programs for hotels to show up higher in the sort order. Commissions vary from 18% to 20%, and in some cases even 25%. Hotels have to be careful not to simply drive up their cost and at the same time become reliant or even dependent on OTA. Keep in mind, their only mission is to grow in terms of global revenue, and that is not always in the best interest of your own hotel business.

We have seen some OTA flexing their muscles this year as well, asking for quite high fixed allotments, yet another sign they are trying to penetrate hotels and the market as far as possible. This happens when they can’t really grow anymore geographically but are pressed by their shareholders for growth each year. Unless we will start opening hotels on the Moon in the next few years, the only way some agencies can grow is by getting a higher commission % or control more inventory in your hotel.

So our advice is to be careful and develop alternative sales channels.

Direct Sales Becoming Increasingly Important
We are seeing hotels becoming more aware each day of depending too much on online travel agencies, wholesalers and other 3rd party distributors. The rising cost of distribution and the advantages of direct sales is something hoteliers are starting to understand more profoundly. Therefore we foresee a shift or rather a re-shuffle in the distribution mix in hotels in 2012.

Hotels are willing to invest more in SEO, SEM, SMM and Mobile marketing as a results of the increasing cost of distribution. They are now more than ever pushing to increase their direct sales, through their own website as well as their call center.

You should perhaps read our last article on a 2012 Marketing Plan for Hotels to get some more ideas on how you could tackle these challenges.

We hope to have shed some light on what it to come in 2012 for your hotel in terms of marketing, distribution and revenue management.

Cheers,

Patrick Landman - Xotels

P.S. For more ideas, visit our hotel blog

Spa Revenue Management Techniques : Dynamic Pricing, Dynamic Availability & Menu Engineering

patrick@xotels.com (Patrick Landman - Xotels) — Wed, 14 Dec 2011 23:00:00 +0000

The previous two articles on Spa Revenue Management should have convinced you, that in order to generate more profit with this business unit, a more strategic approach will need to be implemented, comparable to the way revenue management is applied to hotel rooms. Key performance indicators have to be defined to help understand the patterns of demand and customer behavior. Now we will take a closer look at different pricing techniques.

Although it is possible to implement a dynamic pricing strategy based on the level of demand, customers may not always understand why the price for a specific treatment fluctuates. They may perceive a higher price, during peak demand periods, as an unfair price difference.

It has been one of the biggest concerns and objections that communicated to us by spa managers while training them on revenue management techniques or during revenue management implementations in spas.

In most markets the spa offer often exceeds demand, and managers frequently offer discounts in an attempt to fill the empty treatment rooms. A “Rack Rate’’ is set based on the highest demand level, on which discounts are applied during periods of lower demand or for times when it is even very hard to sell a massage. It seems this is a much more accepted and more faire approach to dynamic pricing.

But hold on, this is a “Discount Strategy”. Just imagine the marketing and communication strategy, “Mud Wrap, 40% off”, ‘’Full Body Massage, 50% Discount’’. Is this the way we want to position our business? Do you want to give the consumer this kind of image of your beautiful Spa, that of a discount house?

While discounting is an easy way to attract extra demand, it is unfortunately only a short time solution. A discount strategy brings along dangers, and can have a negative impact on the consumer’s value perception consumers of your treatments and services. It will actually probably erode your business more than anything, as customers will want access to the discounted prices all the time. We recommend you to stay away from discounting; you will only down trade your own revenue potential.

To implement differential pricing for a spa we will need to get more creative. So in which other way can we maximize revenue during peak periods and deviate demand to off-peak periods, by incentivizing consumers with lower priced treatments, in order to optimize the overall revenue stream of our spa?

The solution to implement different price levels for similar treatments lies in applying conditions associated to the price to justify supplements. You should develop both physical and non-physical hurdles as revenue managers call it. Physical hurdles or barriers include the location of the treatment room, type of treatment and related services. Non-physical rate hurdles include time of day or day of week, length of treatment, membership of the spa, late bookings, advance reservation…

A simple example: someone who wants a treatment on a Saturday afternoon may pay a higher price for a 60 minutes treat than booking a 45 minutes treatment on a Tuesday morning. A treatment in a private room may cost more than a treatment in a shared or with curtains separated treatment area. Views and level of comfort of a treatment room are great yield tools. Such barriers are necessary for a revenue management strategy to work effectively.

To achieve the best possible financial results in a spa, we have to implement a yield technique called Menu Engineering. With this approach we identify which treatments give us the highest profit margins. So as a first step we will need to segment the product / services offer according to volume of sales, duration time and profitability.

Once you have dissected out treatment menu in this way, you can now start planning what type of service to offer during peak hours. Those would be the ones with the highest profit margins of course.

Menu engineering goes back to the core of the definition of revenue management; ‘offer the right product at the right time, at the right price’. Profitability can be optimized by offering the treatment(s) with the highest margin during high demand times. This way a spa can increase its overall profit margin quite easily without significant changes.

An example: A spa has a strong demand on weekends, especially from 11h00 till 15h00. During these ours esthetical services like manicures which for this spa offer a low profit contribution value per hour will not be offered during this time frame, but will be available in the mornings or late afternoon. During the peak hours the will only offer in this case highly profitable treatments like reflexology and full body scrubs.

The above yield technique is known as the dynamic availability is a very effective approach to increase profit for a spa by replacing lower-margin sales by high-margin sales during peak hours.

Now that we understand the basics of Menu Engineering and Dynamic Availability let’s take the next step. We need to identify the products most beneficial to a Spa resort segmenting the, according to volume of sales (demand) and the margin. Menu Engineering identifies 4 types or level of products:

Stars - demand strong and high margins
Plow Horses - demand strong and low margins
Puzzles - low demand and high margins
Dogs - low demand and low margins

Besides implementing dynamic availability of these different product types, it will be very important to also manage effectively the utilization of spa resources and facilities that can support various services. For instance, a treatment room should only be available for treatment of higher margin in peak times. If a spa has three stations and four treatment rooms that can accommodate either manicures or massages, manicures should be made at the stations at any time and leave the treatment room available for a massage with more profitability. There you will have a positive impact on revenues and margins. In the same way you can manage the working time of the team.

As an alternative method to increase revenue and profit for spas, we have also achieved good results through applying Dynamic Pricing. Here are some samples of our actions:

Express Massage at a reduce price for only 45 minutes available only in the morning to attract customers during periods of low demand.
Early Bird Massage to encourage advance sales. This massage was distributed through all sales channels to attract more customers and is nonrefundable, of course…
In-Room Massage, off-site (If you have a pool, it’s even better)... to increase the total capacity of your spa

Due to the nature of spa operations and facilities, a strategy of dynamic availability is generally the most effective technique to apply. Such strategy has less impact on clients seeking experiences and more impact on the profitability of the spa.

Good luck on the implementation of Revenue Management to your Spa. And give us feedback on how it goes …

Patrick Landman @ Xotels

For more tips click here: hotel management blog

Hotel Asset Management has Changed Forever

patrick@xotels.com (Patrick Landman - Xotels) — Mon, 28 Nov 2011 23:00:00 +0000

The focus of hotel asset management has traditionally been on cost control. Reducing the operational or flexible costs on the hotel balance sheet is what used to determine the profitability of a hotel. Over the last few years, focus has shifted !

To control staff payroll, purchasing costs and overhead spending used to be the main components of the job of a hotel asset manager. With the rise of the internet and increased dynamics of hotel distribution we have seen a shift in focus over the last few years.

The attention of hotel asset management has been increasingly moving towards room yield. Driving occupancy and average room rate is the key nowadays to controlling the bottom line the hotel. Of course a hotel revenue manager should have a strategy that goes far beyond REVPAR. NREVPAR (read article) and GOPAR are if instrumental importance.

For the Xotels portfolio we have seen an overall revenue growth of 15.8% in first three quarters of 2011, through strategic pricing strategies. We looked beyond mere cost control and had our hotel clients invest in SEO and internet marketing to increase direct sales. As a result, distribution cost was reduced and profit increased.

Of course we do not advocate leaving costs uncontrolled. That would irresponsible, as with the recovery from the crisis hotels have to be weary not to reinstate cut services amenities too quickly. However the scope of attention has to be widened and emphasis needs to change. Simply cutting costs and ‘trimming the fat’ will also have an impact in the long term service levels of hotel and in the end impact financial results negatively.

Fundamental to success will be to gain more market share in a recovering market. With the occupancy rising across the board in many markets, it is important to fight and pick up 1 or 2 point more than the competition. ADR / ARR should be pushed up where demand allows, in an effort to improve your hotel’s RGI (revenue generation index).

The solution of classical asset management companies will almost always be to put a flag on the roof. However in the era on online distribution, social media and online reputation management a brand is no longer needed. Also should be considered the fact that costs of such ahotel franchise are tremendously high. Moreover their model is out of date. These companies are no longer the best solution in today’s market place.

Modern day revenue management, internet marketing and online distribution is the solution to generate a healthy ROI on your hotel investment. The industry has to move beyond operations to manage well business development. And the next logical trends to be implemented in hotels will be Total Revenue Management and Business Acumen, taking revenue management beyond the hotel rooms and optimize the results of all hotel revenue streams.

Cheers,

Patrick Landman - Xotels

PS. For more information click here: hotel asset management

Xotels expands into Canary Islands with 2 Resorts in Lanzarote

info@RShotelS.com (Administrator) — Mon, 24 Oct 2011 23:00:00 +0000

Xotels has expanded its portfolio with 2 large resorts in the Canary Islands. It is a strategic move for Xotels to further expand its resort portfolio. We are sending a clear message to the industry, revenue management can be applied in any type of hotel, city or vacation (leisure) market. The two resort hotels added to their hotel management portfolio are the Grand Teguise and Hotel Oasis in Lanzarote, Spain.

‘We are quite fortunate with these new properties’ Patrick Landman founder and CEO of Xotels comments. ‘Both hotels have great potential. The 4 star Hotel Grand Teguise Playa, counting 314 rooms, could possibly be a market leader if well positioned.’

Remko West, co-founder and COO of Xotels adds, ‘The 4 star Oasis de Lanzarote, will be closing for refurbishment in January of 2012. It will undergo a complete upgrade of its 370 rooms and all facilities to offer a more competitive product. We will completely reposition the hotel and change the way the hotel is distributed online and offline. All with one mission only, more bottom line profit.’

Patrick Landman continues, ‘The hotels are owned with a majority share by the La Caixa bank of Spain, and were previously managed by a local hotel chain. Looking at the results of the last few years the asset management team of the bank realized that is was time for a change of course. The strategy of the hotels needed to catch up with the way the industry is currently working. This is what Xotels excels in, modern day revenue management guerilla warfare’

Jean Seriat Gautier, Revenue Manager at Xotels mentions, ‘The results speak for themselves, in only 2 months time, and with a little tweaking, we have already surpassed 2011 budget target. It is a question of controlling your Tour Operator offers and availability. Next year we will focus on implementing more dynamic rates and restructuring our online distribution.’

‘The first results are indeed very encouraging. We are working on the 2012 budgets and targets at the moment. Our goal as always is to kick the ass of the competition.’ Patrick Landman adds. ‘In terms of other markets, we are close to launching distribution for our new deluxe resort in Crete, and will be taking over another hotel in Brussels this week or next. Xotels continues to grow and innovate the world of hotel asset management’

Cheers,

The Xotels Team

PS. For more information click here hotel asset management

Here the links for the 2 hotels www.hoteloasisdelanzarote.com + www.hotelgrandteguiseplaya.com

Revenue Management Does Not Apply for Resort Hotels

info@RShotelS.com (Administrator) — Sat, 15 Oct 2011 23:00:00 +0000

I kid you not, there are still people convinced that revenue management is not applicable to resort hotels and belongs in city markets only. Last week I was blown away when a ‘senior contract manager’ of an important UK based OTA claimed rate yielding is not for resort hotels.

We requested access to the extranet to manage rates and availability for 2 of our large resort hotels in Spain, so we could maintain rate parity with our distributors and manage this ourselves instead of sending emails. We thought this was just a normal request considering we will get this for our resort in Crete, Greece, as well.

Well it wasn't apparently. Below the response we got form the ‘senior contract manager’ in question.

Hola Jean,

Es un placer y es cierto que no nos conocemos, antes de nada comentarte que el negocio de mi empresa y el de cualquier empresa que se aprecie no puede trabajar bajo conceptos de paridad,eso va bien para hoteles de ciudad o para los academicos, pero la realidad es muy distinta.

La paridad no hace justicia ni mas siquiera ventas, por lo que no trabajaremos via extranet contigo ni con nadie que quiera ver incrementados sus numeros. Con los hoteles que me comentas ya trabajamos con contratos y asi seguiremos haciendolo.

Saludos,

XXXX

He basically states that hotels can sign a net rate contract and should not be allowed to manage their rates according to demand. Neither will they apply a minimum mark-up.

Strange no, considering that when we contact his Greek colleague to contract a new hotel in Crete it seems to be no problem at all and they fully understand the hotel’s need for flexible rate and availability management.

OK, it happens sometimes a sales manager at a distribution channel misunderstands our request, so we decided to give it another try. See our email below:

Dear XXXX,

Thank you very much for your response.

Please do understand that we need to be able to manage prices and availability according to demand. Yielding down and up for low and high demand days is a necessary requisite for Resort hotels to be able to optimize it's revenues.

If we can't manage rates in a flexible way, we will be left with no choice but to close your channel when we are experiencing a surplus in demand, which of course would not serve your interests either.

Therefore once again we request you urgently to send us extranet access for the hotels below.

We would also like to discuss this matter for the rest of our hotel portfolio in Europe. If you can't accommodate our request please refer me to someone at executive level to discuss this matter.

Again we are looking for mutual beneficial relations with all our distributors across the board, which entails we will be able to manage rates and availability through an extranet.

Thank you & best regards,

Patrick Landman

We tried to make clear our need for a mutual beneficial relationship in which we can manage rates flexibly according to demand.

Why does a hotel need this? It is impossible to contract your rates absolutely correct a year in advance. As time goes by market circumstances change and a hotel needs to be able to adapt in order not to lose revenues. If there are periods demand is low a hotel needs to be able to launch more competitive offers, and if demand is much higher than estimated rates need to be moved upwards.

A hotel does not sell products that have unlimited inventory or for which more stock can be ordered. A hotel room is a perishable product that can only be sold once. Any missed opportunity is revenue lost. Also a hotel can only sell a maximum of 100% of its inventory each day. It cannot increase its stock. So it is essential prices can be managed dynamically so the hotel does not sell out too soon at too low a rate. So hotel revenue management basically comes down to the art of matching supply and demand by dynamic price management.

Here the reaction of our friend:

Dear Patrick,

Sorry but you are not looking for mutual benefits, we work with net rates and that is mutual benefits...

You can close sales at any time (I can see your mutual benefits), but you are not going to be in first page for sure, this is only for partners.

Regarding executive level, you are talking to that... I take that decision.

regards

XXXX

He clearly does not share our idea, and does not want to give us access to the extranet. He even threatens to take the hotels of the first page if we try to actually manage the pricing and availability in the best interest of the hotels.

What does he expect? We just sign a net rate contract long in advance and not be able to manage the rates and availability. He wants the hotel to take in large volumes of bookings without having some form of control?

Mind you we are not talking about a wholesaler or tour operator package rates here. This is an online travel agency… It seems to us he tries to hold his market hostage by threats and out of date methods of distributor pressure. What era is our friend living? Most surprisingly his colleague for the Crete / Greek market has no issues as at all with our simple request and fully understands us.

We decided to probe a bit further as we found his answers unsatisfactory. We asked him if he does not trust the hotel to manage their rates themselves. In the rates and rooms belong to the hotel, and he would only benefit of a higher commission amount if rooms are sold at a higher average rate.

Below his response:

The same question I can ask you, don’t you trust XXXXXX? The own rate?... sorry but I never heard that before, the rates (selling rates) doesn’t belong to the hotels... but to the customers. But you are not a hotel, isn’t it?

If demands goes up... fantastic, then stop sales like always

I know better that you my company, and if I give you the XXXXXX tools you will sell 0 with us because we feed from other as well... and if one of those, like Serhs or NT incoming or Urbis... or whatever have net rates... We, XXXXXX will use that one.

We blacked out the name of the agency and person in question as we do not intend to harm their image publicly.

No, apparently he does not trust hotels to manage their rates according to their needs. He doesn’t seem to understand he will benefit of a hotel that implements a good revenue management strategy.

He also admits to something interesting, if we would close his rates and availability he would simply feed in rates and availability from another wholesaler. Probably these are package rates which he would then sell online on a room only basis. He clearly does not understand how hotel revenue management really works. If his lower rate tiers will be closed, this will be the case for all distributors.

So far for a hotel friendly distributor I guess ... A shame that some travel agents can’t seem a bit further and are stuck in their old ways of bullying and pressuring hoteliers. Our industry is in desperate need for an overhaul and more business smart people. The reactions we got from this ‘senior contract manager’ are totally out of date.

If distributors want to survive they need to quickly change their business model and become more flexible. They have to also retrain their staff, and get them to adjust to the current times. Otherwise they are nothing more than dinosaurs, a dying species waiting to become extinct.

Maybe one day we can visit them in a museum and explain our kids or grand children what went wrong with these inflexible old-school travel agencies.

Cheers,

Patrick Landman - Xotels

PS. For more inspiring articles, visit our hotel blog

Are your 2012 Hotel Targets, Budget and Marketing Plan Ready?

info@RShotelS.com (Administrator) — Tue, 11 Oct 2011 23:00:00 +0000

No time to lose, 2012 is almost here. And a good plan isn’t made overnight. How far are you with your targets, budget and plan of attack for next year? What REVPAR and GOPPAR do you need to achive? Is your hotel marketing plan complete, and does it describe all actions in detail? Does everyone on the team know what the objectives are and which steps to take to get there?

Did you make your 2012 budget already or are you right in the middle? What methodology are you using? Are you simply adding a 3% to 5% each month based on last year’s performance? Or are you really putting your teeth into it and drilling down per segment, per channel, per account, per day?

The basis of the target or budget lays in a detailed demand calendar. Get a clear overview of what drove revenues each day. Map the events, conferences, expositions, trade-fairs, concerts, holidays, vacations, long weekends, etc to 2012. You will start seeing a clear shift already.

Perform displacement calculations on all segments, channels and accounts to uncover hidden revenue potential. Incorporate channel distribution cost like travel agent commission, agency fees and marketing investments, payroll for sales, marketing and reservation, to determine the true net value of each segment.

It seems though not everyone goes into as much detail when making their budget. I have to share with you a funny story to budgeting with you. So we are working with many different hoteliers, and in this case it pertains to management of a resort. Hotels in vacation markets for many have been influenced (indoctrinated) by tour operators on how to manage their property. As a result budgets are made per person rather than per room, meaning that the total revenue objectives become ‘flexible’ if measurement of results does not incorporate enough factors.

Hold on, it gets even funnier. When we were working through the budget for each month, we noticed that several months had targets at revenue levels below last year. Upon probing the reasoning behind this, we were explained that some tour operators had informed them they were expecting a 10% less bookings from a particular country. No one ever raised the thought to initiate partnerships with other distribution channels to offset this possible decrease in demand. Capturing more market share, or penetrating new markets was just not in their mindset.

Sorry, I just had to get this rant of my chest. But unfortunately it is very typical for our industry. Especially in resort hotel markets, tour operators have for too long influenced hoteliers on how to run their business. Hoteliers need to get more strategic insight and understanding of the financial side of the business. Moreover they have to become more creative in methods to increase the revenue performance of their property.

An industry colleague I respect highly called me last week, asking if I knew of any online tool which helps hoteliers developing a professional marketing plan. Not just a standard one, like most hotels punch out, listing a few trade fairs and shows a % increase per segment. No, he was looking for a system that really guides you through every detail and forces you to look at all aspects that need to be incorporated.

And he is right; hotel marketing plans in general are too superficial. It is time they are taken to a more professional level, and become complete. Hotels are multi-million dollar or euro businesses and they demand an expert strategic and structural approach.

So what are elements you need to incorporate in your 2012 marketing plan? Taking into consideration the continuing growth of online sales and the quick adoption of mobile technology by consumers, we have put together some questions that will need your attention in 2012:

Internet Marketing

How much revenue do we expect our hotel website to produce in 2012?
What growth are we expecting from 2011?
What is the balance between print and internet marketing?
Are we shifting budget from offline to online?
What is our plan to attract more traffic to our website?
What will we do to increase more conversion of our hotel website?
What new online marketing initiatives will we launch next year?
How will we collect more emails, mobile phone numbers, and FaceBook connections to be able to directly engage with our guests?
How will we attract our different client target markets and niche guest segments?
How will we measure the effect and ROI of all our marketing actions?
What will we focus on, how much financial and human resources will you dedicate to;

Website Redesign or Optimization
Links from local and travel directories
Search engine marketing SEM / PPC
Search engine optimization / SEO
Banner advertising
Advertising on Meta-Search, Review Websites and Travel Forums / Communities
Interactive campaigns / promotions (contests, games, quizzes, sweepstakes)
Email marketing
Mobile Website
Mobile Search Engine marketing SEM / PPC
Social media marketing / Travel 2.0
Online reputation management
Blog
Video
Analytics / ROI tracking
Webmaster
External marketing agency (experts)

Online Distribution

Have you identified new local or international sales channels your hotel needs to be on?
What are your key segments, niche segments and feeder markets?
Are there any travel agency channels or forums out there that can help you attract these customer target markets?
How will you manage to keep a healthy balance between direct and indirect (third party) sales online?
What is your approach to protect your hotel from brand hijacking by OTA?
Are your FIT and wholesalers respecting the contract?
How will you prevent wholesalers to distribute and publish package rates as room only deals on online travel agency websites?
How will you control your cost of distribution?
Will we use rate parity as a strategy to drive business through more cost-effective distribution channels?
Will we guard against cannibalization by costly distribution channels like Flash, Group and Lastminute sales websites?
Will we let ourselves be caught up website trends and hypes which only lead to an erosion of the hotel’s net rate?

As you can see many things have to be considered and included in the hotel marketing plan. We need to look at these aspects of the business, and many more, as they influence your financial results.

I hope these thoughts will help you to make a more complete hotel marketing plan for 2012.

Cheers,

Patrick Landman - Xotels

PS. For more ideas, visit our hotel blog

Strong Q3 REVPAR Results for Hotels across Europe

info@RShotelS.com (Administrator) — Wed, 05 Oct 2011 23:00:00 +0000

The 3rd quarter of 2011 continues to show growth for independent hotels across Europe. The Xotels hotel management company portfolio has shown another 15,3% REVPAR increase, putting us YTD at 15,8% REVPAR growth ….

Remko West, co-founder and COO of Xotels comment, ‘In our city hotels we have been able to drive high occupancies with moderate ARR increases of around 5% during the summer months. And in September European cities like Amsterdam, Brussels and Maastricht have shown strong demand from the corporate and MICE markets allowing us to yield prices upwards during city wide trade fairs and conferences. At one property we even achieved a 40% year over year REVPAR growth in September.’

Patrick Landman, co-founder and CEO of Xotels adds, ‘We did not only work to increase REVPAR of our hotels, but in properties that are running 95% occupancy or more, we have been reducing the share of costly distribution channels, working only with a maximum of 15% commission. GOPPAR and profitability is rising notably as a result. Moreover, we are working strategically with the hotels to increase direct sales through their website and by phone.’

Jean Seriat Gauthier, of the Revenue Team notes, ‘Our hotels in resort destinations like Mallorca, Lazarote and San Sebastian have also showed strong results in Q3. REVPAR was increase by 90% to 19% due to better control of the market mix, and limiting overproduction and displacement by low yielding distribution channels during high demand periods.’

Here a summary of our 2011 hotel REVPAR results:

Hotel	Q3	2011 YTD
Pantone Hotel - Brussels, Belgium	+28%	+24%
Theater Hotel - Brussels, Belgium	+59%	+47%
Qbic Hotel - Amsterdam, the Netherlands	+26%	+23%
Townhouse Hotel - Maastricht, the Netherlands	+9%	+24%
Hip Hotel St Martenslane - Maastricht, the Netherlands	+6%	+16%
Hotel Es Moli - Deía, Mallorca, Spain	+18%	+16%
Hotel de Londres - San Sebastian, Spain	+9%	+10%
Grand Hotel Teguise Playa - Lazarote, Spain	+19%	+16%

‘The Outlook for October is also very good. Many of our hotels have an ADR on the books significantly above last year and target. The outlook for the fall and end of the year in Europe is very encouraging.’ Remko West notes.

‘In 2 weeks we will add a new property in Brussels, and soon we will launch sales for our new resort in Crete, which will open its doors to guests early 2012. We are also exploring to add some more creative lodging concepts to our portfolio in the Netherlands as. Investors and property owners seem to like our model. We are seeing an increase in demand for revenue management outsourcing.’ Patrick Landman ends.

For more information, click here: hotel management company

KPI for Spa Revenue Management: SUR, ATR, REVPATH, SREVPOR

info@RShotelS.com (Administrator) — Wed, 24 Aug 2011 23:00:00 +0000

Last month we discussed the apparent need for hotels to implement a Revenue Management strategy for their spa in order to maximize the profitability of their business. So let’s now take a closer look, and define the Key Performance Indicators that need to be measured.

Just like Average Room Rate, Occupancy, REVPAR, GOPAR, for Hotel Room Revenue Management, Spa Revenue Management has its own statistics. The 4 most important KPI to measure Spa performance are:

1. Spa Utilization Ratio (SUR)

Do you know what the Spa Utilization Ratio or Occupancy is? Really, what was yesterday’s utilization level of your spa? And how about last week, month, or year to date? Are you measuring occupancy levels of each of treatment room by hour, half a day, and full-day?

To calculate the utilization ratio of your spa you need to define time and space units to be measured. For example, if a spa has 5 treatments rooms and is open from 10.00am till 8.00pm. And during the week you have sold for 250 hours of treatment. The occupancy will be 71,4%. The utilization ratio is calculated as follows:

SUR = hours of treatment sold / hours of treatment available

250 hours of treatment sold / (10 hours * 5 treatment rooms * 7 days) = 71,4%

2. Average Treatment Rate (ATR)

The Average Treatment Rate is the revenue generated divided by the number of treatments sold. The Average Treatment Rate will vary upon the level of demand, day of the week, type of treatments sold …The ATR is a good indicator when using a dynamic pricing strategy.

3. REVPATH

REVPATH stands for Revenue Per Available Treatment Hour, which is calculated by the total revenue generated by treatments, divided, by the number of treatment room hours (treatment rooms multiplied by numbers of hours opened).

Treatment Revenues
Treatment Rooms x Opening Hours

It is basically the same as REVPAR for your hotel rooms.

Based on the REVPATH results, you will be able to identify trends per of the day of the week and time of day. It will enable you to develop a strategy to sell premium products during specific time slots of high demand or offer a promotion to appeal to clients during lower demand hours.

4. SREVPOR

Spa Revenue per Occupied (hotel) Room is an important indicator to measure how many of your clients, staying in your hotel rooms, are utilizing the Spa. It identifies the relation between the occupancy of the hotel and the results of the Spa. Depending of the season and also depending of your hotel client mix, the contribution to the spa may vary. An interesting KPI that helps you understand the ratio between internal and external utilization levels.

Other Key Performance Indicators that can be useful are:

Total revenue per client TREVPEC
Revenue per square meter TREVPSQM
Therapist Productivity

All these statistics can be calculated from data extracted from your Spa Management System. You will have to set-up a structural process to analyze the data and KPI, to identify trends and develop a smart Spa Revenue Management Strategy.

Next month we will discuss how to build a Pricing Strategy for your Spa.

Patrick Landman @ Xotels

For more revenue management tips, click here: Hotel Blog

How to use QR Codes as a Hotel Marketing or Guest Service Tool

info@RShotelS.com (Administrator) — Sun, 14 Aug 2011 23:00:00 +0000

QR Codes are taking over window shops and restaurant or bar menu’s by storm. Is it a FAD, a hype that will disappear with a year? Or is it the beginning of a new trend in consumer engagement? How can we apply this in hotel marketing or in giving better service to our guests?

You might have seen them already in window shops or at tradeshows these QR or Quick Response Codes. It is used to divert an offline consumer to an online mobile platform. They can scan this 2D ‘BAR’ code with their mobile device, upon which they are directly diverted to a website landing page, or access all other kinds of information, including web addresses, personal or professional contact information, or FaceBook action / promotion pages. There are several QR apps you can download for free.

The key in using QR codes comes down to added value. You have to give them something that they did not know have yet. You can of course for the ‘win a price’ approach, or try to push your special offers.

But our guess is consumers are getting a bit tired of all the special offers thrown at them. This morning I was just reading an article on the? Backlash of the Groupon Effect’. Consumers are getting saturated, by offers already every day.

We have looked for another angle, and are instead using QR codes to improve the guest’s service experience. QR codes are used on cards in the rooms, announcements in elevators, at the concierge desk and message boards in the lobby to engage clients with tips on where to dine or what to do during their stay.

Upon scanning the QR code, they will be diverted to the hotel website’s blog which contains the latest events, restaurant tips, attractions and activity recommendations, our favorite shops, etc. From here the guest can also navigate to our social media pages.

This is a simple way to increase the guest service level in your hotel, and in the same time connect to your guest through social media platforms like a Blog, FaceBook, Twitter and Google+.

We have introduced this concept with several of our clients, Hotel de Londres in San Sebastian, The Signature Hotels in Saudi Arabia and HTEL Serviced Apartments in Amsterdam, among others, and received very positive feedback. And we are using it for our own hotel management blog as well.

We recommend driving consumers to a specific promotion or landing page, not just your hotel website. In the beginning you will need to educate your guests and include a call to action. Tell them what to do ‘Scan this Code for our Latest Restaurant, Shopping and Tourist Tips’.

People need to think that upon scanning the code they will receive some very cool and interesting information. If you don’t have a blog you can send them to your local Tourism or Visitors Bureau website or mobile app. You could also use it as a promotional tool to offer a discount on drinks in the bar or dinner in the restaurant, and offer 10% - 25% off during certain hours for those who scan it. The QR Code Happy Hour is born …

For more information, click here: hotel marketing

How to Market a Hotel? in 10 Steps

info@RShotelS.com (Administrator) — Sun, 24 Jul 2011 23:00:00 +0000

Where to start when implementing a hotel marketing strategy? How to promote a hotel with the internet moving so rapidly with new developments every day, week and month … Here is a 10 step plan on how to market a hotel.

1 - A Story Worth Telling

Your hotel needs to have something unique, refreshing or innovative. Your hotel needs to have a story to it which people like, and think worthwhile to share with their friends. Good service is at the basics of all of everything, this you have to get 10% right. Being remarkable ( = worth making a remark about) is not that hard either if you think of it. How about handing out an ice cream at check-in during the warm summer days? Or invite all hotel guests to a delicious fresh French roast coffee when they arrive at the hotel.

2 - Regional and National Press

PR has and will always be important to reach your domestic market. Make sure you build a good relationship with journalists and editors of regional and national newspaper and magazine publications. This way if they want to do a travel story, you are the top of their list.

3 - GDS + Consortia

Apollo, Galileo, Worldspan are seen by many as a dying breed. But these Global Distribution Systems are reinventing themselves, and are still an important source of business and leisure travel for many destinations. Moreover mega agencies like Amex, ABC Corporates Services, TQ3 Travel Solutions, World Travel BTI and Carlson Wagonlit are very effective distribution channel to reach corporate travelers of large corporations.

4 - OTA

The poster boards of the hotel and travel industry in the online age, are among the most important distribution channels. Their commissions and models vary; analyze them well to make sure they add value to your overall strategy. Be certain they aren’t just shifting direct business away from your direct sales efforts, but really generate incremental bookings

5 - DMC

Local Destination Marketing Companies, work hard to attract groups and events. You should approach them and work together with them to attract corporate and leisure groups during low and medium demand periods. It will help you to diversify your hotels’ market mix

6 - Tourist Office + Convention Buro

Talk to your local tourism office and find out how they can help you to promote your hotel. Make sure you have a representative listing on their website and that you are well promoted in their office when tourists come to town. The Convention Buro should be your other best friend. You should be on the top of their list for group requests for conferences and city wide events in your destination.

7 - Sales Rep

Have a sales representative put your hotel on the local map with local businesses nearby. Visit prospective and current clients regularly, bring the gifts, meaning smart and real gifts. Spoil them rotten, and make them addicted to you.

8 - Website + SEO

You will need an optimized website for your hotel. If you want to generate direct sales through your website think keyword searches and consumer segments, before burying yourself in the design aspect. Your store can be pretty, but you need people passing by and stepping in to have a chance at a sale. SEO is very often heavily neglected.

9 - Social Media + Review Website

Yes we know by now (I hope so at least) we need a FaceBook, Twitter, FourSquare, Gowalla, YouTube page and profile. We have to manage our presence on these social media actively and create fresh new content every week and month. A blog is great tool for this. Next, manage your online reputation. Encourage your guests to leave reviews on Yelp and TripAdvisor. Incentivize if needed to get guest pics and videos. Your profile on the hotel and travel review websites needs to be active and dynamic. Oh yeah, don’t forget to respond! You have to be involved…

10 - Mobile

Finally, hotels are starting to move beyond their own website into mobile marketing. Don’t think a mobile app is something every independent hotel needs. Let’s start with a basic mobile website which allows you to easily navigate an image gallery of the hotel and has a simple click to call button. From there you can work on integrating your booking engine and develop a more advanced mobile hotel website step by step.

A few Warnings
One thing you shouldn’t do, and this is getting on the Flash Sales train. You will only dilute your business and slash your Average Room Rate down to levels , that your hotel will incur revenue losses instead of generating incremental revenue.

I just noticed we did not mention Tour Operators and Wholesalers. That’s correct, their model is broken, and they are only a necessary evil hotels need to use until they have redeveloped themselves into OTA / IDS style agencies with dynamic sell rates, respecting the hotels’ distribution needs.

Last but not least, don’t spend too much money on printing brochures etc. We are in the electronic and digital age …

For more information, click here: hotel marketing

Top 10 Social Media Marketing Tips for Hotels

info@RShotelS.com (Administrator) — Mon, 11 Jul 2011 23:00:00 +0000

Here are our Top 10 tips for hotel social media marketing. We have put these together from daily hands on experience performing internet marketing for our hotels. It is the best list of practical ideas that can be implemented right away.

1 - Have a Blog to post information on activities, attractions, dining, shopping, nightlife. It allows you to provide your guests with suggestion on what to do. Moreover it is a constant source of content that you can use to spread on other social networks like FaceBook and Twitter.

2 - Manage your online reputation, by inviting guests to post reviews on TripAdvisor, Yelp and other review websites. Make sure you also respond to all reviews and that you manage your profile on these sites (description, pictures, contact info).

3 - Invite guests to join your FaceBook page (upload their emails), and ask them to post pictures of the hotel and their trip. Panoramia is also a great site to have guest post pics as it is linked to Google Earth & Maps.

4 - Link local companies and attractions in your Twitter and FaceBook posts by using ‘@’ and their profile name. It will jump start your interaction online and grow your sphere of influence. To make it easy, think like your guests. Get connected to cities, tourist attractions and tourist information centers by liking their page. Just start reading and very often the accommodation requests are right there for you to grab. For example on the city page of Amsterdam a young lady is asking for tips on what to do during her trip. Give her a compliment on choosing Amsterdam because it is simply awesome and include a shortened link (goo.gl) to the blog on your hotel website that just happens to be about the top 10 of things to do during a short break in Amsterdam. (but don’t overdo it). This way you can get the interaction started and after a few messages back and forward she might book your hotel. If not no worries you just generated a bunch of clicks to your hotel website.

5 - Prizes to get the job done. An incentive gets people moving. Give a free weekend in return for the best guest pic of the month …

6 - Local check-in site like FourSquare or Gowalla can help you gain exposure and promote your F& outlets. Give a welcome cocktail when checking in online if staying at the hotel. Or a free upgrade based on availability (1 per day of course ;) ).

7 - Find interesting and funny videos of your destination and add them to your YouTube Channel to create a sort of video tour guide. Compliment the ‘producer’ and let them know you put it on your official channel.

8 - Recycle content across social networks. Your positive reviews should be posted on Twitter and FaceBook, as well as your blog articles. Gather all your guest pics from Picasa, Flickr and Panoramia into one album on FaceBook.

9 - Get a (young) internet savvy person on your team to work on social media. They are fast in picking this stuff and copying best practices from others. He will be more personal in speaking to your guests. And this is very important.

10 - Be funny and original. A sense of humor works better then a formal and conventional approach. What is the last thing you really click-ed on or read on FaceBook? I am sure it was funny or original… it’s what works…

These simple steps will help you grow your fan base and create interaction with your guests. Engagement is not easy online, but these tips and best practices should help your hotel’s social media marketing strategy.

For more information, click here: hotel social media marketing

15% REVPAR Increase for Independent Hotels in Europe

info@RShotelS.com (Administrator) — Sun, 03 Jul 2011 23:00:00 +0000

The first half of 2011 is showing very promising signals for independent hotels in Europe. Xotels, a hotel management company that specializes in revenue management, has recorded a 15% REVPAR increase for its portfolio:

Patrick Landman, co-founder and CEO of Xotels comments, 'Our team of revenue management experts has really proven themselves, driving premium rates as well as occupancy in recovering and in destinations which are still suffering from the economical impact of the crisis. We grew occupancy from 72,85% to 80,62% across the portfolio and average room rate increased by €4,14 to €107,79.'

Remko West, co-founder and COO at Xotels, notes, 'We take over the complexity of the yield plus distribution strategies and operations from the hotelier, so that he can focus on what he is good at; hospitality and service. Our formula of revenue management outsourcing has been very successful in both city and resort hotels. Overall we experienced a REVPAR growth of €11,39 in the first half of 2011, resulting in revenue per available room of €86,91. Take a look at some of the results of our hotels, the numbers don't lie ...'

Pantone Hotel Brussels - 14% REVPAR increase
Theater Hotel Brussels - 41% REVPAR increase
Qbic Hotel Amsterdam WTC - 21% REVPAR increase
Townhouse Hotel Maastricht - 34% REVPAR increase
Hip Hotel St Martenslane - 22% REVPAR increase
Hotel Es Moli, Deía Mallorca - 13% REVPAR increase
Hotel de Londres San Sebastian - 8% REVPAR increase

The second half of 2011 looks even more promising. In our resort destinations we have already reached July's revenue targets and outperformed 2010 results. For our city hotels, we are working actively on SEO to increase direct sales, especially during event dates with a high level of unconstrained demand' Remko notes.

'We are now looking at adding another property in Brussels and a resort in Crete, which will open early 2012. We are also in talks to incorporate some properties in the UK, and are exploring to expand into New York as well as other US markets. Our result oriented hotel management concept speaks a lot to independent hoteliers. Xotels' guerrilla style yield strategies are economically a more effective solution than the outdated franchise model. We help owners and investors generate a better ROI, which will help finance the growth of their portfolio.' Patrick ends.

For more information, click here: hotel management company

How to become number 1 on Tripadvisor

info@RShotelS.com (Administrator) — Sun, 26 Jun 2011 23:00:00 +0000

Last week Htel Serviced apartments reached the number 1 spot on Tripadvisor on specialty lodging. And we'd like to celebrate this with them. Here's a short version of what happened to Htel Serviced Apartments, and the implementation of a Hotel Social Media Marketing campaign that got them to this spot.

'We went through a metamorphosis', Ingmar starts. 'I do not have any other words for it. Obviously, our guests have always been extremely important to Htel Serviced Apartments. However I remember well, at the start of 2010, we had lost track of where our online consumers were. We were not even sure if they existed, and we were definitely not connecting with them on Social Media platforms'.

'In addition to that I knew we had to catch up with the competition. We were not involved in Social Media at all and our online business was not running as it should. We had limited traffic on our website, and we did not generate any revenue online. Having met with Xotels - our current business partner- several times I knew it was time to make a huge jump in the deep. We made a strategic, long term investment in our website, online marketing and social media marketing'.

'The transition process is never quick. You don't build a good website overnight, SEO is not something you do for 5 days to be able to see a result. And the hospitality industry in general is still walking a path of discoveries related to Social Media', says Remko.

'Now, almost 1,5 years later, Htel is picking the fruits of their investment. And their consumers are guests are proving it first and foremost. Htel Amsterdam hit the number one spot on Tripadvisor for specialty lodging.'

Ingmar continues: 'Tripadvisor is right in the center of our Social Media Campaign. This is where guests actually take the step to sharing online with Htel, and with other consumers. And Xotels shows us, hands on, how to connect with our guests on the platform. Tripadvisor is proving to be huge for us. Not only is Tripadvisor a travel website with millions of unique visitors each month, it's also like a social accelerator. More reviews, more guests, more responses by me, better reviews, more and more guests'

'Tripadvisor is not the only indicator of Htel's successes', adds Remko. 'The revenue that the website generates exceeds everybody's expectations. Their 2 serviced apartment complexes have Minimum Lengths of stay of 7 and 28 nights for the different properties. That has a huge impact on conversion. Today the numbers tell us that the website actually generates indredible revenues via the booking engine. On top it ranks between the least expensive distribution channels'.

'And the offline spin-off is also enormous, says Ingmar again. I have chosen not to set up separate phone numbers or email addresses to track the spin-off business of all the visitors to our website. But I know it's there, I have personally already received a lot of recognition for the website, and we have roughly 50 offline requests every week'.

'Looking back, the smartest strategical decision I made was cut back on offline marketing spend, and shift funds to online marketing. I reduced my overall marketing cost with 35 percent, and my general business results are better than they have ever been. And the market is telling me that we're doing it right today. In the end, how else could we get to spot number 1 on Tripadvisor'.

For more information click here: Hotel Internet Marketing

Why Hotels must apply Revenue Management to their Spa

info@RShotelS.com (Administrator) — Sun, 29 May 2011 23:00:00 +0000

Many hotel property owners and hotel management teams of city hotels, resorts, conference hotels and upscale country side B&B’s are adding a luxury Spa to their property. Why?

Because by adding a spa to their hotel they will:

Create a competitive advantage
Increase the guest experience
Drive up the ADR, revenues and profitability
Generate additional revenue streams
Raise the value of the property

But unfortunately we notice that most of the time, the spa is underutilized or even empty. As a result spa’s in hotels often represent an additional cost factor, instead of an incremental revenue source.

The Spa Product needs to be managed more strategically!

Hotel spa’s just like the rooms experience periods of high and low demand. At the stage of high demand you will often see a more profitable treatment has to be denied to guests, because the treatment room is booked for a low profitable treatment or several short treatments.

As demand fluctuates and busy and high demand periods can be easily identified, there is a large opportunity for hoteliers to generate incremental income and profit by implementing Revenue Management techniques to their spa product, just as the optimize the revenues of their hotel rooms.

Remember the spa is not only a way to add value to the hotel and increase the guest experience. It is vital product to generate an incremental revenue stream.

Even though hoteliers are using tactical pricing techniques like spa packages, discounts, 2x1 treatments, gifts, etc, to try and sell the treatment rooms during periods of low demand, very few have developed a strategy that allows grouping these techniques in a policy of Revenue Management.

Most spa’s sell their treatments on a "first come, first served" basis. Revenue Management will help spa hotels to attract extra clients during low demand periods by offering attractive treatment deals and growing revenue and profit (or yield) during strong demand periods by optimization strategies.

During various spa revenue management training courses given by Xotels, we have noticed a very perceptive attitude and openness towards these ideas. However we also noticed that hotel and spa manager were challenged with where to start. In brainstorming sessions on spa revenue management opportunities we have come to agreement with spa specialists that the key of success in applying Revenue Management lies in:

Contribution analysis: Where are your incomes coming from? Which treatments are more profitable for your spa? What is the contribution weight of a treatment within your total spa income? Do you have reasons to keep selling a 30minutes massage, for example?
Productivity management: What is the period where incomes are the highest? Which is the treatment least sold? What day of the week has more demand?
Additional sales follow-up: Besides the treatments, can you get your client to spend more in products, gifts and accessories? Do you have a proper system to keep track of extras by type of client? Is your team prepared to sell?
Cost management: How to better control costs? How to reduce the time between 2 treatments? How to promote the treatment with higher profitability?

Revenue Management will help you manage these 4 elements and thus allow you to increase the income generated by the spa. You will need to build reports, just as with hotel room revenue management, to provide you with data to help you to make better decision on your spa pricing strategy and sales strategy.

Next month we will talk about how hoteliers can apply Revenue Management to their Spa.

Patrick Landman @ Xotels

For more tips and ideas click here: hotel management blog

How to Run a Professional Hotel Blog

patrick@xotels.com (Patrick Landman - Xotels) — Mon, 16 May 2011 23:00:00 +0000

There seems a lot of disagreement if blogging is still effective in the days of micro-blogging sites like Twitter and age of social media like FaceBook. At Xotels we have been managing hotel blogs, and are achieving good results through a well thought out strategy. And this is the key for hotel internet marketing; you need a plan to get somewhere.

We are managing various hotel blogs, for different kinds of lodging products. All of the blogs have a unique image and approach. It is important the blog connects with your guests.

We creatively target local attractions, events, shopping, dining and nightlife tips, etc to provide the hotel’s clients with an idea of what they can do in the destination. It is important to give your hotel blog a personal touch and informal style.

Among the hotel blogs we manage are;

As you can see we cover a wide range of topics in these hotel blogs. Moreover we are not only focused on text. We also include picture galleries of past events and tourist maps listing attractions using Google Maps.

It is very effective to use a blog as a kind of online concierge or tourist guide for your hotel guests. As a next step this content allows us to engage our guests as well other travelers and about what is going on in the destination via FaceBook. By promoting local events in FaceBook and participating in discussion on other pages we create more buzz around our brands. And as a result our blog pages get likes. Very subtly we are growing the sphere of influence of the brand this way.

But blogs can also go beyond social media. SEO (search engine optimization) is strong potential component of a blog strategy. Some of the blog articles we created have raised in position on the search engines and gained a primary ranking. Timing is of the essence here. You have to launch your blog article way ahead of the event to be able to compete. Think 2 or 3 months!

We avoid being over commercial, and will never send special offers to our hotel blog subscribers. However we will promote certain events, and at the bottom or on the side of the blog article we provide a link to a related special offer or to the home page. This way the content is not viewed as an intrusive interruption but as valuable and useful information on things to do.

Patrick - Xotels

For more information click here: hotel internet marketing

Xotels adds Flagship Property to its Hotel Management Portfolio

patrick@xotels.com (Patrick Landman - Xotels) — Mon, 02 May 2011 23:00:00 +0000

Our international hotel management portfolio of outsourced marketing and distribution is growing steadily. Our ‘Rent a Revenue Manager’ program was launched only last year, and we already have 15 properties under contract. The recent addition of the Hotel de Londres y de Ingleterra, a 4 star hotel in San Sebastian Spain, is very exciting to us. It will be a leading flagship property for Xotels.

This luxury property has an amazing beach front location and offers sea view rooms overlook the renowned Bahía de La Concha of the Basque Country’s coastline. For this hotel we have taken over the revenue management strategies, online distribution and internet marketing.

We are currently planning our tactics to optimize the ARR (average room rate) for the summer period as well as building a 12 month demand calendar, which will allow is to drive up the REVPAR significantly.

Having carefully studied the results of the hotel from previous years, we have already uncovered some hidden revenue potential, which will have an important impact on the profit of the hotel. In the end the bottom line is what matters.

We are also working on redeveloping the hotels online positioning and will shortly launch a new hotel website design. A lot of time is invested on the search engine optimization by creating dedicated landing pages for unique keyword phrases and searches. And best of all, the city of San Sebastián Donostia, with its many tapas bars and plenty of popular events will allow us to create an interesting blog, in order to expand the online reach of the property.

The Hotel Londres will be undergoing a full renovation of the rooms and public areas in the next 2 years, of course maintaining its authentic image and character. Moreover will it be adding an additional floor of penthouse rooms that will features balconies with amazing sea views.

The owners and management of the property realize that this kind of investment needs to generate a proper ROI. The best way to do this is to unlock the potential of direct sales through the hotels own website and reservations office. They understand that a professional strategic approach in terms of revenue management, online distribution and internet marketing is fundamental.

Patrick - Xotels

For more information click here: hotel management company

How serious do hotels take Guest Feedback?

patrick@xotels.com (Patrick Landman - Xotels) — Thu, 17 Mar 2011 23:00:00 +0000

Having travelled a lot in the last month I have been observing some great differences in the levels with which hotels are looking for feedback from their guests. Some hotels simply do not seem to care, others have it a review score card implemented as a systematic part of their operations, few however really ask me for my opinion and make me feel they really care…

With the trend of online reviews I was pleasantly surprised to find out that some hotels still really care about my feedback. Over the past month I have travelled all over the USA and Europe, and most hotels did not provide me with a guest comment card, not even at check-out so I could put it in the mail and send it back to them for free.

Most of the hotels that did provide a guest feedback form, had one of those tic tac toe form. They simply want me to degrade my opinion of their service to a number, a score… They do have an option for additional comments below each section, but must not realize by the time I get to that, I am kind of worn out already.

I am sure that the management of the hotel will also receive very interesting stats and graphs based on these bingo cards. They will be able to analyze which department scores what % of guest satisfaction, and follow trends over time.

This last week though a hotel really surprised me. They asked me their opinion not at check-out, but continuously during my stay. Every day there was a comment card on the bed, posing the following question; ‘How did we do today?'.

But not only did housekeeping put it on the bed after cleaning my room, they also provided it when I order room service, and it was again on the breakfast table. They are constantly looking for feedback on the services used in the hotel.

I did not mind filling in the form several times, as they asked me open questions, really showing their interest in my opinion. The questions on this ‘How did we do today?’ form were so simple really,

Your Feedback
How you evaluate our services?
Small details. Big differences. Are there any small details that you particularly valued (or any new ones that you think we should be look at)?

The fact that they focused on real input instead of scores I really liked. If hotels want to improve their services, it is not about a number, it is about the actions they take. Suggestions and comments from guests will be very useful...

Patrick - Xotels

For more information click here: hotel marketing

A penny for each time I have heard “Revenue is great, but can’t be applied in my hotel”

patrick@xotels.com (Patrick Landman - Xotels) — Fri, 25 Feb 2011 23:00:00 +0000

I would be rich by now if each time an hotelier told me “Revenue Management is great, but can’t be applied in my hotel”, I would have received a penny! I am heavily disappointed when I meet an hotelier and I hear this sentence, because it is absolutely wrong!

Revenue Management is applicable to all kind of hotels: small, big, city, resort, independent, chain hotels, business or leisure hotels… As long as every single day a hotel needs to get the most of its fixed capacity depending of the level of demand expected, you would leave money on the table not implementing some degree of revenue management.

In our daily environment we face lots of service companies that are applying their own revenue management: train companies, car rentals, cinemas, theaters, spas, golf clubs… Once with one of my colleagues, which likes playing Bowling, we‘ve start thinking on how to implement Revenue Management for a Bowling center. As there is more demand on Friday night, Saturday and Sunday we need to put some restrictions on the number of players to increase the turnover. Wednesday is also a busy period but for teens and students, so we have to do a special pricing for them as well as for holiday periods. A bowling center has also its low demand period, and the issue is to displace the demand to Monday or Tuesday night with some bowling classes or bowling competitions… We went very creative…

So if a bowling center can apply Revenue Management, why can’t it be done in your hotel?

Or do you simply not care about losing out on potential revenue

Revenue Management does not have to be complicated. Start with the Basics! First analyze your market and identify what’s going on. Identify for the next 12 months, periods or days with strong and weak demand, this will be the first step of forecasting. As soon as you know what will be the level of demand you can expect, build your rate strategy and work on your distribution. When all has been planned correctly the daily management of your rates and inventory becomes easier.

Revenue Management will help hotels to work on the long run; it’s where the money is. Stop working at 2 or 3 weeks time. Working 12 months ahead will make you more competitive with regards to your competitors and get clients that are booking in advance for your hotel. Did you already start loading the appropriate rates on all OTA for 2012? Did you already built your net rate grid for 2012 for Tour Operators?

I hope that hoteliers that still think revenue management can’t be applied to their own business will take into consideration for a change how much they can increase their results by.

From our experience your REVPAR can be increased easily with 20%. But let’s take it easy, I am sure you would be happy with 5% more sales...

Good luck and please never tell me again that Revenue Management can’t be applied to your hotel!

Patrick Landman @ Xotels

Read more on our revenue management blog

FaceBook, the New Hotel Search Engine …

patrick@xotels.com (Patrick Landman - Xotels) — Mon, 14 Feb 2011 23:00:00 +0000

Everyone is focused on the integration of prices by Google in their maps and universal search results, and on how this will impact the hotel and travel distribution landscape. And they are right as it will have an important impact on direct sales for hotels. But there is something else going on that you need to be aware of for your hotel internet marketing strategy. FaceBook is becoming a hotel search engine!.

Social media marketing has been getting a lot of attention in the hotel and travel industry over the last two years. But now more than ever it is vital for hotels to have a presence in FaceBook with a company page for their hotel. Your hotel listing needs to contain relevant, usefull and recent information for your guests and potential clients.

Why? OTA and aggregator websites are moving in on your turf.

Take look at the search below for the Qbic Hotel in Amsterdam. Besides TripAdvisor it includes results from Booking, HotelChatter and FourSquare.

Yes it is not limited to only your page, but distributors, travel communities and review websites are listed, potentially diverting traffic away from you.

In a search for Hotel San Sebastian Playa in Sitges we encountered HolidayWatchDog, TripAdvisor, VirtualTourist and Frommers

You have to make sure your hotel page comes out on top in FaceBook and offers interesting information for travelers. Otherwise they will simply move on, and you will be losing out on some direct business.

A search for Booking.com confirms that they are indeed listing hotels in FaceBook. We have see it before, but it seems the list of properties has grown.

In order not too loose out on direct business it is extremely important you have a well developed page for your hotel listed in FaceBook. You need to provide attractive, relevant and recent information to capture the interest of potential bookers. Remember images speak more than a 1000 words.

Hotels cannot afford to be left behind and need to make sure they have a structural social media marketing strategy in place!

Patrick - Xotels

For more information click here: hotel marketing

Hotel Brand Hijacking by OTA, it should be banned …

patrick@xotels.com (Patrick Landman - Xotels) — Tue, 08 Feb 2011 23:00:00 +0000

If OTA claim to bring incremental business, why do they advertise on hotel brand names? Shouldn’t they focus on destination searches instead? It seems the larger chains have convinced the OTA to refrain from this practice. However to independent hotels or hotel management groups they are not showing much consideration. This SEM hijacking or brand keyword robbery needs to stop.

Consumers search for a hotel name, because of a recommendation from a friend or a review they read online, or better even because of offline advertising by the hotel itself. Through advertising on the hotel’s name in the search engines, the OTA intent to convert this direct client into an OTA client for that hotel or worse, re-direct them to another hotel.

It seems Marriott and Hilton have successfully managed to clean up the advertising on their trademarsk, according to a recent study done by HEBS, Max Starkov informed me last week. ‘When searching Marriott Hotel + destination you will not see Priceline, Expedia, Orbitz or any other large OTA. The same goes for Hilton’ he stated.’ These chains have convinced Expedia and other leading OTAs to focus on bringing in incremental revenue.

However if we dig a bit deeper, we see that the affiliate websites of these distributors are still advertising on the chains brands. So there is still work to be done to clean up SEM Hijacking as Max calls it …

The OTA aren’t really paying consideration to their promise to generate incremental bookings when it comes to independent hotels. They blatantly advertise on brand keywords on Google, Yahoo and Bing. How can they allow their own sales pitch to hotels to become so obviously hollow? Stick to your promise!

It almost looks like the OTA are becoming just like the flawed franchise model with which hotels have become so disgruntled over the last decade. This game is so old, sign up more hotels so we can use their clients to steer business to other hotels.

In the case of running offline advertising, you run the risk of paying twice for the same client. Firstly for your newspaper add and secondly an OTA commission on top. Here an example of advertising on independent hotels by OTA;

What are search engines like Google, Yahoo and Bing doing to help protect the brand and trademark of independent hotels? Not much, as they are generating large revenues from the advertising of course. Instead of a lengthy appeal option, they should provide a ‘flag’ system through Google Places allowing businesses to mark unauthorized advertising to be deleted.

The OTA aren’t the only ones at fault. Hoteliers have to take a good look in the mirror, and take responsibility for their own actions. In the end they have allowed this to happen, by signing distributor contracts without sufficient understanding of the landscape and market dynamics out there.

We are now getting to the constructive part of this article. As a solution we recommend hotels to include clauses in their contracts with OTA to prevent such brand hijacking practices. It is a very important step in controlling your distribution cost and production.

For the various independent hotels we have in our own management portfolio we have opened the discussion with the OTA on this topic. Initially we were getting some standard evasive answers. OTA will always try to justify this practice. A funny explanation was that they are able to bring us bookings from far away countries like china which we can’t reach with our hotel marketing efforts. They have websites in local language etc. This excuse was easily overthrown by explaining that this should be done through natural SEO, and not SEM keyword bidding.

Once the OTA sees you know what you are talking about as an hotelier, they will shift gears. We informed all our distributors we will only work with partners that respect the brand and trademarks of our hotels. Clauses and addendums were added to the contracts outlining in which we want to work together with them and their affiliate websites, creating a win-win situation.

We have gotten a very positive response from many IDS, including Bookings, Lastminute, HotelBeds, Transhotel, etc.

One OTA stands out though in their response. Expedia across Europe has basically stated, that they do and not work this way with independent hotels. Having discussed this matter with their team in different countries, the message in essence is that they are not capable of controlling their keyword bidding by their various points of sales, especially not for independent hotels. We have an easy solution for this, simply don’t advertise on hotel brand names, and be a partner as you yourself advertise to hoteliers.

Last week I came across an article online, titled The Benefits of Using OTA, in which Melissa Maher, VP of global strategic accounts and industry relations @ Expedia on stated “Why wouldn’t you use an online travel agent?” she asked. “My pitch would be, why exclude them, because there are significant revenue opportunities?” (read here). It seems she is answering her own question here. Hotels are looking for a benefit in working with OTA, a win-win situation in their relationship with distributors. You claim to bring incremental business in your sales to hotels, but your actions contradict this.

TripAdvisor, Expedia’s sister company, also seems unwilling to respect the hotels trademark in this sense. They simply are not willing to cooperate with independent hotels when this issue is addressed with them.

It is time OTAs accept that hotels have woken up and it is time for change. If they don’t stop this advertising on hotels’ brand names and trademarks, they will stand to lose their product. As the economic outlook improves hotels will gain the upper hand in this partnership and look for alternatives. Hotels will find out that direct distribution through effective internet marketing is less costly and new supplier friendly OTAs will arise and challenge the status quo. In the end the hotels have the rooms, which are the real key to this distribution market, and the power of negotiation …

Compare it to an Egyptian or Tunisian revolution. Desperately clamping on to power will only lead to a downfall of the regime.

The days of SEM Hijacking or Brand Keyword Robbery are numbered ...

Patrick - Xotels

For more information click here: hotel marketing

Xotels Management Group adds Hip Hotel St Martenslane to its portfolio

patrick@xotels.com (Patrick Landman - Xotels) — Tue, 01 Feb 2011 23:00:00 +0000

Yet another hotel has been added to the Xotels group of independent hotels. Upon exceeding the budget with 26% in 2010 for the newly opened Townhouse design hotel in Maastricht, the Netherlands, the la Bergere Group decided to also outsource revenue management and distribution of the Hip Hotel St. Martenslane to the Xotels’ Hotel Management Group.

This funky hotel is a great addition to our management portfolio in the Netherlands. It is our second hotel in Maastricht, allowing us to quickly implement the local market knowledge we have already required. Every city is different, and Maastricht for instance is a destination with mainly a drive market with a hour radius. It is important to understand this as it affects the booking window.

As it also part of the La Bergere Group, it allows us to cross sell and penetrate different levels of market segments. We expect great results at the Hip Hotel St Martenslane, and are excited to have taken over the revenue management and distribution of this budget hotel.

With our hotel management services we give support to independent hotels in terms of outsourcing or coaching of revenue management, online distribution and internet marketing. In 2010 we managed to grow and outperform RevPAR targets for our hotels between 12% - 26%. For this year we are off to a good start already with tremendous year over year growth in January already.

In 2011 we expect to add quite a few more hotels to our portfolio. Currently we are in talks with hotels in Amsterdam, Brussels, Prague and various destinations in Spain. We would also like to explore opportunities in France, Germany, Italy, UK and Ireland as well as the USA and Asia of course.

Patrick - Xotels

For more information click here: hotel management company

a Year of Flash Sales and Price Wars in Hotels

patrick@xotels.com (Patrick Landman - Xotels) — Thu, 27 Jan 2011 23:00:00 +0000

2011 will become the year of flash sales in travel. But not the way you think. Of course websites like SniqueAway, Group, VoyagePrive and Jetsetter will catch on. But after a while hoteliers will figure out these websites will only erode their value proposition and average room rate even further than OTA’s have done supposedly in the past. No flash sales will take a different route in hotel marketing.

Statistics from emarketer.com below clearly show flash sales websites gaining in popularity with consumers. Their traffic has increased significantly in the last year..

Besides these retail discount shopping websites, new start-ups have been launched for the hotel and travel industry. New websites that we have seen enter into the flash sales model for travel include; SniqueAway, JetSetter, VoyagePrivé, LivingSocial and RueLaLa.com. They are a kind of copy of what TravelZoo has been doing for years already, emailing out travel offers and hotel deals to a subscriber base.

These websites work on a membership-only basis, creating the notion that the rates are not published to the greater public. We dare to differ on that opinion. As it is so easy to join these websites it will not be long before the opaque-ness will disappear. Once they have created momentum and consumers are catching on, your guests will understand that besides offering €200 on your own websites, they can get better deals by subscribing to these online discount stores. They just have to wait and sit back for an offer to come out.

Hotels are all jumping on board of the Flash and Private Sales train, as they lack creativity, insight and willingness to invest in direct sales. Once again they are supporting and building a model which in a few years they will start complaining about. Yes it amazes me to hear hotels complain about the so called high commissions of the OTA, but at the same time support new models which will erode average room rate even further and will leave you with a lower net ARR.

Websites like Groupon and Guestmob are teaming up consumers to drive down prices at hotels by the so called value of volume. Well let’s do some math before going down this road. A 50% discount of your BAR, with a 50% revenue share leads to a 25% net ARR from the public rate you are selling your hotel at. Let alone the ARR erosion, would this kind of room rate actually deliver margin to your bottom line?

All these types of ecommerce start-ups are useful for the retail and electronic markets which need to offload unsold stock from their shelves as new models come out or the next season line is launched. For these types of products discounting is a method to get rid of otherwise unsellable inventory.

This is not the case in hotels. Heavy discounting as experienced with OTA’s over the past years will only lead to the erosion of value perception by the potential client. We will be trading down our product value once more, making it harder to demand and convert the rates we need and should sell our hotels at. You should not allow yourself to be lured in for short term gains which will have long term ramifications, without thinking it through properly.

So it is once again time for a wake-up call for hoteliers. You should focus and use the tools out there to promote your hotel and website directly. There are lots of free tools out there. Have you considered a 10% early bird discount through the offer coupons of Google Places? Put a tagline as well in Google places to make your hotel stand out a bit more. Guess what, this one is for free.

Are you investing the same amount in SEO as you are paying in OTA commissions? Why not? Don’t you want your hotel website to produce? From experience we have seen that SEO can run at a 10% cost in terms of ROI. If my math still works correctly, this is a lot better than 15% - 25% OTA commission.

Then there are websites which through loyalty programs and rebates lower your rate. They cut their commission to be more competitive. We have noticed Otel.com is doing this. They take net rates from distributors with which you have sell rate and rate parity agreements and publish your hotel rates at 15% instead of 20% margin. Hotels have to wage a war on these cash back or rebate systems to stay in control of their rates.

Yes 2011 will become a year of rate war. But not so much between hotel competitors, instead we are foreseeing a war between the hotels and their distributors. Hotels will become tougher on OTA to respect rate parity.

Once we have got these basics under control, it is time for guerilla war fare. We have to outsmart and outperform our competition. How can we do this? We can learn a lot from all these new websites. Hotels will drop rates for particular dates out of parity to pick up a few extra occupancy points. They will do so not structurally, but only for a time span of 1 or 2 hours.

They will do so on OTA with a lower % commission to attract more volume through meta-search sites like Kayak and HotelsCombined. It would not make sense to do so with your most costly distribution channels.

Most importantly hotels will do so through their own website. They will launch rate offers for a short time which does not allow for the competition to monitor this. Think about this, lowering your rate at 7pm and raise it again at 7am to sell to overseas markets while your competition is at sleep. Also your local and loyal guest base won’t see it…

Hotels will get more creative and break rate parity where and when needed for their own good. In 2011 Flash Sales will grow initially through the new ecommerce initiatives. But hotels will wake up and try to shift this principle to drive direct sales through their own hotel website and reservation’s office. They will start to understand how to convert consumers from looking to booking by promoting urgency and exclusivity themselves…

Patrick - Xotels

For more information click here: hotel marketing

REVPAR up 12% - 26% in 2010 @ hotels of Xotels

patrick@xotels.com (Patrick Landman - Xotels) — Sun, 16 Jan 2011 23:00:00 +0000

Our hotels have fared very well on the economic recovery last year. As part of our hotel management strategy we monitor the loading factors of the air travel markets closely which give us clear indications of overall travel trends. It allowed us to be well geared up and prepared to ride at the front of the wave. REVPAR increased as much as 26%.

The biggest challenge we faced in 2010 along with fellow hoteliers on the European continent was caused by the eruption of the Eyjafjallajokull volcano in Iceland. Especially our resort and beach hotels were impacted by the large number of cancelations of flights due to the ash clouds.

Overall we have seen very positive results with notable REVPAR and GOPPAR increases in our hotel management portfolio. Here our results;

Qbic Hotel WTC Amsterdam, 0* - www.qbichotels.com
This is quite an exceptional hotel. Being a modular concept, we increased the inventory of this property by 46% mid 2009. Yes you read it right; we added more rooms, which is easy with this flexible real estate model. We simply rented another floor and put in more units. We managed to increase REVPAR by 12,7% (€7,66) over the second half of the year and 4% overall in 2010. Occupancy is trending above 95%.

TownHouse Hotel Maastricht, 3* - www.townhousehotels.com
This newly opened trend setting hospitality concept showed an impressive performance in its first year. REVPAR targets were outperformed by 6.6% or €4,30. The first part of the year, while ramping up corporate demand, was not as strong as the second half of the year where REVPAR expectations were exceeded by 26% or €17,00. Occupancy was consistently above 90% allowing for operations and costs to be effectively controlled.

Pantone Hotel Brussels, 3* - www.pantonehotel.com
This colorful design hotel in the heart of Brussels opened its doors on April 12th,. The new Pantone hotel concept proved its potential, and within a few months profitability was reached. In the first year REVPAR surpassed budget by 24,5%. or € 14.00.

Theater Hotel Brussels, 2* www.theaterhotelbrussels.com
This cozy boutique hotel in Brussels is a test case for a larger hotel concept. Since Xotels took over revenue management for this property, REVPAR increased by a little over €20.00. Through more efficient distribution occupancy was pushed up with 24% and ARR with €2.00. The hotel is currently outperforming its revenue budgets by 23%.

Es Moli Mallorca, 4* - www.esmoli.com
Joining us in August of this year we turned around this luxury resort property from a 15% REVPAR decrease in the first half of 2010 to a 9% or €11.00 or REVPAR increase in the second half of the year.

Hotel San Sebastian Playa Sitges, 4* - www.sitges-hoteles.com
Managing this hotel since September the Xotels Hotel Management Group increased REVPAR by 14% or € 6,50 for the fall of 2010. Our efforts were also focused on the 2011 strategy, for which a shift in distribution mix has been planned. Reducing the dependency on tour operators will add another 20% of revenue to the hotels’ income statement, forecasting a €16.00 REVPAR increase in 2011.

Dynastic Hotel Benidorm, 4* - www.hoteldynastic.com
Unfortunately Benidorm was heavily impacted by the ash cloud crisis. We estimate the lost revenues in the months of April, May and June to exceed €150.000. Taking this into consideration, we are pleased with a flat Year Over Year REVPAR result. REVPAR in the other months increased with approximately €17.00 as a result of a more effective mix of Occupancy and Average Rate.

Hotel Gala Placidia Benidorm, 3* - www.hotel-gala-placidia.com
Also located in Benidorm, Xotels managed to increase REVPAR by €2.00 irrespective of the volcano challenges from Iceland. We smartly traded occupancy for a substantial increase in average room rate, driving up revenues and profit in peak season. Next year Xotels revenue management specialists will continue this upward trend and build additional occupancy at higher room rates.

Overall 2010 has brought very positive results in terms of REVPAR and GOPPAR. Our revenue management outsourcing clients have all decided to sign up for another year of Xotels hotel management services. We are also in negotiation with some to add more properties to our portfolio in 2011.

For more information click here: hotel management

Online Reputation Management Tool for Hotels

patrick@xotels.com (Patrick Landman - Xotels) — Wed, 12 Jan 2011 23:00:00 +0000

Reviews have become an important key performance indicator for hotels. Consumers are writing about their travel experience on online travel agency websites, travel communities and independent review websites. The new social media culture of sharing online requires follow up by hoteliers. To manage your hotel’s online reputation, Rate Tiger launched RT Review .....

This new Hotel Review Management Tool allows you to monitor your brand’s reputation across various websites. Additionally can you respond directly to these guest reviews from RT Review, making it both a social media monitoring and communication tool.

So what can you do with it exactly?

Be alerted when you get new guest reviews
See your review score trend over a period of time (last 7 days, 30 days, 12 months)
See how you perform in different review websites
View your score in different review categories (F&B, rooms, cleanliness, customer service, etc.)
Compare your results vs. competitor hotels
Analyze score result details by website
Read the individual reviews
Respond directly to the reviews

As to be expected, Rate Tiger has made an easy to use dashboard allowing any hotelier to use RTReview with only a brief online training. The screenshots below will give you an idea of the user interface:

Websites that have been intergrated into RT Review include: booking, boo.com, expedia, fastbooking, globalhotelreview, holidaycheck, holiday-truth, holidays-uncovered.co.uk, holidaywatchdog, hotel.info, hotels.com, igougo, mytravelguide, orbitz, priceline, qype.co.uk, reviewcentre, travelpost, travel.yahoo.com, tripadvisor, trivago, venere, zoover, travelocity.com, reisen.de ...

Online social media reviews are becoming more influential in the decision process of today’s consumer. Hotels can no longer afford not to monitor and respond to them. Ignoring reviews is like saying to consumers browsing the internet that you simply do not care.

RT Review allows you to incorporate reviews like a pre and post stay marketing tactic as a part of your over hotel internet marketing strategy. To understand what active review management can do for you, take a look at this hotel on a well known review website, TownHouse Hotel Maastricht. It is number the 1 hotel in its destination, driving more and more direct sales.

For more info, email us at ratetiger@xotels.com

Rudolf and Elfie break away from Santa this Xmas

patrick@xotels.com (Patrick Landman - Xotels) — Wed, 22 Dec 2010 23:00:00 +0000

Rudolf and Elfie decide to hang out with the Penguins in Antarctica this Christmas instead of handing out our free hotel revenue management tools.

Guess you have to wait till next year to get your Xotels gift :)..

Happy Holidays!

The Xotels Team

How to Distribute your Hotel Online to Capture Groups

patrick@xotels.com (Patrick Landman - Xotels) — Sun, 19 Dec 2010 23:00:00 +0000

We should not stop at building our group demand calendar and pricing strategy. Nor should we depend on our conventional sales manager to fill our meeting space and bring groups to fully fill the hotel at all times. Hotel revenue managers should embrace online distribution and hotel internet marketing beyond transient room sales. There are a lot of online travel agencies that target groups ....

Over the year we talked a few times about niche marketing and how to target specific unique mini segments. We can do the same when it comes to groups. Going onto the search engines and typing in keywords like ‘group travel’, ‘group hotel rates’, ‘group hotel booking’, ‘group accommodation’ we run into a great variety of websites that can help us distribute our rooms to groups.

The group segment is a growing part of the online travel ecommerce. Below a few examples of websites we have encountered:

There are even group itinerary planning sites like www.triporama.com.

This growing segment can no longer be ignored by revenue managers. We must fight to gain market share across the board. By the way did you notice Booking.com has launched group bookings in their website? See below how they combine you inventory to book a group:

Besides room only sales, there are also websites dedicated to distribution meeting space online. A few examples are:

We could on and on with these list, but I think the point is clear. We need to do more to penetrate segments, like groups, meetings, incentives, celebrations, etc.

Surprisingly enough it seems the hostel world is doing a better a job at this than then the hotels. In all the searched we have done, hostel websites come up more that online travel agencies and hotel websites.

Two hotel chains that did have their SEO for groups in order were Marriott and Choice. They returned for various searches related to this segment on Google. We particularly liked the page below by Choice Hotels targeting sports travel.

Have you thought about targeting sub-segments and niche markets of groups on your hotel website? Are you attracting them through effective SEO? Remember the SEO long tail of niche marketing is very effective!

For more information click here: hotel internet marketing

Patrick Landman - Xotels

Group Pricing Strategies for Hotels

patrick@xotels.com (Patrick Landman - Xotels) — Wed, 15 Dec 2010 23:00:00 +0000

Besides setting out strategies for the Transient, Corporate and Wholesale segments, we also have an opportunity to generate more revenue by preparing and planning for group business. Revenue management strategies have to be applied to groups as well.

So what should we be looking at? Where to start? First of all if we have made an overall demand calendar for the year as well as a forecast per segment, we will be able to determine how much of our hotel room capacity we can sell to groups.

Or taking it a step further, using a displacement calculation, how much we should charge to displace forecasted sales from other segment to generate additional income and profit for the hotel.

But let’s go back a step and work on the foundation of our group strategy. We should make a group demand calendar which will serve as a guideline for the sales team on how and what to quote exactly, with confidence.

For this we will have to log for which peridos we get group requests, when we get these requests, at which prices we do or do not convert. We need to track the regrets and denials of our groups.

This will help you to develop a group demand calendar which can look something like this :

Based on the OTB and Forecast we can give a group rate and ceiling in terms of room capacity. Remember, such a tool is to be dynamic and gets adjusted as we analyze the pick-up from the various segments.

Knowing the lead time and conversion of your hotel’s group business will give you more confidence in quoting. The Historical data below would tell us to be confident with quoting groups in January and February for March and April, as we still expect many requests which will also convert well. So no need to negotiate or move on rates here...

Last but not least, as mentioned earlier, a displacement calculation should be performed if a group would take away capacity from other forecasted segments. The group should generate more revenue and profit which we would be able to generate with the potentially displaced business. You will have to take into consideration not only room revenue but all spending, revenue sources, including meeting rooms, food and beverage, etc...

For more information click here: revenue management blog

Patrick Landman - Xotels

Revenue Management Tips - Video 1

patrick@xotels.com (Patrick Landman - Xotels) — Sun, 05 Dec 2010 23:00:00 +0000

We are continuing the virtual tour of our office with some hotel revenue management and yield tips. Take look at this video with some ideas and best practices in Revenue Management.

Take a look at the video below, a virtual tour of the Xotels office with some practical hotel revenue management tips:

For more ideas click here: hotel blog

Patrick Landman - Xotels

Revenue Management Outsourcing is the New Trend

patrick@xotels.com (Patrick Landman - Xotels) — Mon, 29 Nov 2010 23:00:00 +0000

Just over a year ago we wrote an article announcing the increase in outsourcing specialist areas in hotels like revenue management. In the aftermath and recovery from the global economic crisis the eyes of real estate investors and hotel owners should have been opened acknowledging the need for structural change. We would like to benchmark our insight from last year against a recently published survey of Cornell University by Sheryl Kimes titled the Future of Revenue Management.

It seems this survey of 500 professionals in fields related to revenue management for the hotel and travel industry share our outlook from 1 year ago. The articles I am referring to is ‘The Time for Outsourcing is Now’.

6.4% of the respondents feel revenue management would be outsourced. This is a higher number then we have seen before, and according to our estimates we will only see this level to continue to grow.

But why? What is at the basis for this trend of outsourcing hotel yield strategies?

The biggest challenges in revenue management identified by the group are the qualifications of revenue managers as well as owner pressure and senior management. We fundamentally share their belief that there is a disconnect between the level of expertise of revenue managers in general (read: many revenue managers lack basic skills) as well as true understanding by senior management of this strategic part of the hotel business.

Below you will find a graph that illustrates the main concerns we will be facing over the years to come:

Respondents feel the industry will become more strategy driven and we utilize more specialized technology to do so. The hotel industry is in need for a change to become more professional if we want to be able to foresee in the financial needs of investors and deliver appropriate ROI. Revenue management will be one of the main drivers of this fundamental change.

Below a graph illustrating what we expect revenue management to look like in the next 5 years:

Revenue management will expand its role within hotels from a focus on room revenue only and will also cover areas like F&B, meeting rooms, groups, catering, spa, golf, parking, mini bar, etc. Measurement of resutls will change from REVPAR to GOPPAR and TotRevPar. Revenue management will not only cover more revenue generating and operational departments, but will also become a driving force behind marketing, budgeting and property design.

The new role of revenue management requires a more sophisticated background and profile. We have noticed in 2010 that investors and owners are acknowledging the fact that more expertise is needed to generate a competitive level of ROI on their properties. The demand for revenue management outsourcing has clearly increased.

Outsourcing in itself might not be the right word. The part ‘OUT’ makes is it sound a bit negative, where in fact a management company you contract works together closely with your on site team.

For more information click here: hotel management

Patrick Landman - Xotels

Many Revenue Managers Lack Basic Skills

patrick@xotels.com (Patrick Landman - Xotels) — Sun, 21 Nov 2010 23:00:00 +0000

Last week Thursday I moderated an expert panel at the BTO conference in Florence, #bto2010, discussing the state of revenue management within the hotel industry. Confirming Xotels’ 4 years of revenue management training and consulting we have come to a rather sad conclusion though; many revenue managers still lack basic skills..

Before we get into detail on which skill they are apparently missing, let’s figure what the cause is, who is to blame?

Unfortunately too many hotels are still relying on internal promotion. Which in itself is not such a bad thing, but a good reservations manager, does not make a good revenue manager. The skill set and job scope is different. Reservations is a sales department, revenue management is business analytics. Not quite the same. This doesn’t mean a reservations manager cannot become a good revenue manager. He / she could, but there is the proper training required developing their skills to be able to do the new job.

So what skills do we at Xotels expect from a revenue manager;

Economical insight - No man or company is an island. They have to understand the world they operate in. How do currency exchange fluctuations affect cross-continental demand? Why are the dynamics of the market as they are? A good revenue manager reads up on economical news. The Financial Times and the Economist should be in theire briefcase for a quick update on the way to work.

Analytical skills - Revenue management is the equivalent of business analysis in other industries. Very good analytical skills therefore are an absolute basic requirement. One has to be able to cross analyze various date, detect trends and variations, grasp and understand complex data models.

Math magician - Math is at the basis of all analysis. Subjects like statistics with weighted average, standard deviation and variance are important to understand for a revenue manager. You have to be good with formulas and calculations. If you don’t, it will be very hard to develop and understand trend analysis tools.

Spreadsheet master - This is where it all happens for most revenue managers. Excel or any other spreadsheet application is used to recompile data into analyzable statistical overviews and legible graphs. A real revenue manager is at least capable, besides making basic formulas of developing; pivot tables or dynamic tables, macros, dynamic graphs, conditional formatting, lookup references, data filters.

Technically savvy - Hotel revenue management comprises of steering a great variety of distribution channels, online reservation systems and possibly a revenue management system. These systems have to be well understood and managed. So a hotel revenue manager should know a hell of lot more about systems and applications in general than your average hotelier. Managing a revenue management system is like racing. You won’t win by going 120 km/h. And for driving a formula 1 car you need skills. If not you will not be able to out smartly maneuver the other drivers, and possibly gravity will pull you off the track in a sharp curve and you crash.

Internet geek - Nowadays online sales represents a high of the hotels revenue mix. The influence of the internet is ever growing and other segments like meetings and incentives sales have also made their introduction into ecommerce. A revenue manager needs to know what is going on online, where is the market going, which channels and models are coming up, what are their implications for online travel distribution.

Readers digest - How many and which newsletters and blogs in your revenue manager subscribing too? Is he keeping up with not only hotel industry news, but also with global economical developments? Information is at your fingertips with the internet and there is no excuse to be well read anymore.

Communicative and Determined Strategist - Besides being analytical it is important that a revenue manager is capable of presenting and defend his model and decisions, based on calculation in front of the hotel’s executive management team and possibly owners. He should smoothly steer them away from emotional decisions based on experience and feelings, towards informed and calculated decisions based on statistics. He needs to be strong enough to say NO to the Sales department, and even general manager.

Explorer - Revenue management is business analysis and comes down to taking informed decisions based on statistical trends. Still there is a certain crystal ball part to the job as one never is truly sure about what the future has in mind for us. By using statistics we reduce the risk in our decisions. It will allow us to see the light and choose for a well founded and solid course of action. However, once in a while a revenue manager has to stray away from the common path, to be able to discover new opportunities. He needs to experiment and take risk, without fear, with new strategies and techniques to analyze the outcome. Samples dates need to be tested, decisions logged and outcome measured. A revenue manager who does not have the drive to explore new opportunities, and prefers the status quo, could very likely mean the decay and downfall of your hotel in the long run. We need to stay competitive by being ahead of the pack.

Winner - Maybe more a personality characteristic then a skill, but a good revenue manager has a drive to win. He must want to outperform the competition, and constantly looking to improve his score. Revenue management is like playing Pac Man, it is all about the adrenaline to beat your own maximum score.

As you can see revenue managers need quite some particular skills, which we do not find in the average hotelier. So when we think we would like to promote someone internally, we should really consider if they fit the profile and have the right skills, if not we should provide training or start looking outside our organization.

Various universities and hotels schools have started a revenue management curriculum. However we have found that the freshly trained ‘revenue managers’ lack much insight into the functioning of the hotels front office, reservations sales and marketing departments. As a revenue manager it is important to understand the dynamics and specifics of other departments. Hence such school trained revenue managers should also complete traineeships going through several operational departments.

Sadly we have found many revenue managers to lack these basic skills required to perform well in their job. We hope the industry will wake up and invest more resources and pay attention to get the right people into the right place. We need to pay better salaries and provide expert training programs if we want to achieve better results and regain control of our inventory…

For more information click here: hotel revenue management

Patrick Landman - Xotels

10 Reasons to lower your hotel internet marketing budget

remko@xotels.com (Remko West - Xotels) — Tue, 16 Nov 2010 23:00:00 +0000

I actually would like to rephrase this. I recommend to stop all online marketing spend. Just kick it out of your budget. Save some cost for a change. I simply would like to take back what I wrote in previous blog posts, and what I said during any of our seminars and workshops about hotel internet marketing and social media marketing. I now run a 100 room hotel and I have got it all figured out .

Here are 10 rock-solid reasons why you should never invest another Euro in online marketing:

I am saving a lot of money by not spending on online marketing. Seriously, I am talking about tons of money! You can reduce cost by not investing in lonline marketing.

Instead of investing upfront in online marketing, I figured out a solution. I am giving a bit more, actually all of my business to 3rd parties. My most important online provider only charges me about 300K a year. And my average commission percentage is only 19%. 560K a year…. Not bad for my 100 room hotel is it?

Impossible to analyze. Web analytics are complex, and they are hard to analyze. Website functionality is impossible to understand. How would I know where people are willing to click? Who cares if I lose them on the 4th or the 5th click? On top, consumers keep changing anyhow, they’re always on the hunt for this new thing. Why put in the effort?

Websites are hard to build, and I heard that you have to rebuild them every 2 years, because they get old-fashioned so fast. I have never been too much of a trend-follower anyhow. I can stick to what I know and do the same I’ve always done. It has always worked, there’s not a single reason why it wouldn’t work in the future.

Websites are extremely hard to control. How would I know what type of website design works well?? And I will never be a programmer, so forget about me managing a website or a blog. I have enough on my plate.

It’s fun to fill the pockets of big online players. Paying commission is good, and why try to do something myself what they can do so well already? They will be better in online marketing anyhow. And no way I can compete with these guys. At least I will pay them afterwards, not upfront. Less insecurity.

I’d rather spend on paper brochures. Paper is the future. We should stick to a traditional hotel franchise model. The huge declines in sales that newspapers have seen for the past 5 to 10 years are temporary. The paper-business is rebounding one of these days.

I’d be taking a huge risk by spending online. I do not know what happens to my money spent online, I can’t measure the ROI, nothing. They say online business has spin-off to offline business. I am not buying it. I never get phone calls from people who found me online.

Social Media are a fad. I don’t want to move where consumers are moving. And I also don’t want them to follow me all the time. I find that it scary idea that people can find and follow me whenever they decide. I should be in control, not the consumer. If I could stop them from opening their mouth on Tripadvisor, I would. I have always encouraged them fill in guest satisfaction surveys, and they can simply hand them back in to us. That way I’ll get a good understanding of how they experience my hotel.

Social media have nothing to do with business. It’s just a bunch of people, that probably don’t even know each other ,talking together. The information they’re exchanging is not trustworthy, so there are plenty of good reasons not to get involved.

OK, OK, none of the above things said is true or close to correct. I am just giving you a heads-up on some serious challenges you might be facing. Things you’re stuck on. New developments that are heading your way, and you’re not so sure which direction to take.

I know, today’s hotel business environment is becoming increasingly complex.

Traditional hotel representation models no longer work.

The internet allows you to market to and interact with those people that are only waiting to find you. Even without a big representation brand on your front door.

Want to work on drastically improving your business? Have a chat with us.

Careful though! We just might ask you to change to way you look at things.

For more information click here: hotel internet marketing

Remko West - Xotels

Best Hotel Website Design

patrick@xotels.com (Patrick Landman - Xotels) — Thu, 04 Nov 2010 23:00:00 +0000

Following our latest blog release on our hotel seo success story, we would like to share with you some of our best hotel website design.

Over the last few years we have been working on optimizing our hotel website design templates. You can see here the results of some our best hotel websites:.

For more information click here: hotel internet marketing

Patrick Landman - Xotels

Rate Parity as a Revenue Management Tool

patrick@xotels.com (Patrick Landman - Xotels) — Mon, 01 Nov 2010 23:00:00 +0000

The objective of rate parity in hotels is to encourage consumers to book direct. They should not find any advantage of booking via a third party website over making a reservation on your own hotel website. Learn in this weeks article how to get organized and use rate parity as a hotel revenue management tool.

In order to implement rate parity properly in a hotel, and truly have the same price over all your distribution channels, you need to log and configure the taxes and margins of the 3rd party websites correctly.

Too often we still see hotels making calculation mistakes. Simple math is at the basis of this. And of course we need to know what the difference is between margin and mark-up. This occasionally still is a challenge.

Make an excel table with all the conditions of each portal, include;

Tax % (included / excluded)
Net / commissionable
Margin % / fees
Cancelation policies
Payment policies
Free sale / allotment
Release

It will help you better understand your hotel distribution mix.

Next step is to configure your channel management system with the correct margin and taxes so you can easily load the same sell rate for each extranet.

As surely you work with more than one room type per online travel agency website, you now have to configure a differential, variable per room type. For instance, set the difference between your superior room and deluxe room to €40.00. This way you will save time of rate loading a price for each single room type, and will only have to submit the BAR for one room type and your channel manager will update the rest.

As you can see, implementin rate parity in a hotel is quite easy. You just need to get organized. Having a channel management system surely helps.

Having the same rates on all public distribution channels will stimulate for more consumers to book directly with your hotel.

One final important question remains, can they find easily your website?

For more information clck here: hotel management tips

Patrick Landman - Xotels

Managing Price Sensitivity in Hotels: Lastminute Deals vs. Early Bird Offers

patrick@xotels.com (Patrick Landman - Xotels) — Mon, 25 Oct 2010 23:00:00 +0000

Don’t forget that the price is a Selling TOOL. Price lets us segment and attract different target markets with the objective of maximizing Revenue. But we have to be careful our revenue management strategies based on price sensitivity don’t turn against us.

Every week when talking to hoteliers we hear the comment that consumers are booking more last minute every year. The online travel agencies are the favorite scapegoat for causing this development.

Of course with the rising of the internet over the last 10 years it has become easier to book a hotel room online. It has become more readily accessible. I would like to argue though that this is merely an advantage to the worldwide hotel industry.

But the making of hotel reservations more last minute is partly caused by the social economic developments of our society. Consumers make more mini-trips to various destinations throughout the year, instead of extended vacations to one location. The shorter trips leave them more flexible in picking dates allowing them to search for the best experience and value.

Should we not also ask ourselves if we are not part to blame for this decrease in booking window. Many of you surely remember Biology class in the first years of high school. We were taught about a Russian scientist, Pavlov, studying the behavior of dogs. The conditioning of the behavior, called the Pavlov effect, is exactly what we are doing with consumers.

We are conditioning, or teaching, consumers to wait with booking by offering aggressive last minute hotel deals. We are not make slight adjustments to our prices, but significantly repositioning our rates when forecasts, or rather expectations, are not met.

A classic example of one day where this categorically applies is New Years Eve. Every year we hoteliers put out high rates, MLOS restrictions and non-refundable fences, and we wait. But so do the consumers, who usually win, as hotels have to open up the gates with no solid base business on the books.

We have found it much more effective to accurately forecast the occupancy each day and plan in advance how many rooms we can and want to sell at each rate level. We start with offering the more moderate rates as an early bird offer, and systematically work our way up according to the booking pace, demand, we register.

Price sensitive client are incentivized to book early, outside of our regular booking window. By the time non-price sensitive consumers start shopping and making reservations, we already have built a healthy base.

We have to manage price sensitivity more effectively. And teach consumers to book early if they want a deal. Start selling from lower rates and keep increasing the rates until the arrival date, in order to reach a larger clientele base.

Of course we need to get our forecasts right, to be able to do this.

For more information clck here: hotel management tips

Patrick Landman - Xotels

Hotels Wanted, Dead or Alive

patrick@xotels.com (Patrick Landman - Xotels) — Mon, 18 Oct 2010 23:00:00 +0000

Xotels is looking for hotels, which want to improve RevPAR, reduce travel agency commission costs, increase direct sales, increase GOPPAR and generate more profit through effective hotel management. Does your hotel fit the profile?

Over the last year we have added 8 hotels to our hotel management portfolio and it is time to brag a bit about the results. On average the hotels where we are responsible for the revenue management we have increased revenues anywhere from 10% to 30% and we are trending 20% ahead of budget on average.

We have increased direct sales through optimized hotel website design, SEO and SMM. Traffic of the hotel websites we developed increased anywhere from 50% to beyond 300%. Our simple and smooth booking process also increased conversion levels, generating yet again more revenue. The fact that we manage to get online reservations at a higher ARR (average room rate) through the hotel website than through OTA added to another increase of the hotels’ bottom line.

Even newly opened hotels have been turned profitable and into market leaders within months of their launch by our creative revenue management and hotel internet marketing strategies.

Here a selection of hotel companies where we are responsible for the revenue management and online marketing to give you an idea;

How did we increase their results?

Simple, we implemented a long term revenue management, pricing and distribution strategy. To that we added a proper hotel website design, fully optimized and supported with search engine optimization, social media marketing and blog management services.

Most important we brought in focus and structure. We set out a plan and follow it consistently. Not surprisingly our favorite song is by Toto, ‘hold the line…'

So now we are looking for more hotels to manage and increase the bottom line with our unconventional hotel management strategies. Do you want to make more money with your hotel?

For more information clck here: hotel management

Patrick Landman - Xotels

Hotel Pricing Matrix

patrick@xotels.com (Patrick Landman - Xotels) — Sun, 10 Oct 2010 23:00:00 +0000

Now that we have our demand calendar, how do we start with pricing? We have found it effective, before setting a base price for each day, to develop a pricing grid. Such a hotel pricing matrix is an essential revenue management tool.

Every hotel should have the tools to sell expensive or cheap when needed. Such tools we call price or BAR levels. In your pricing matrix you can include various BAR levels to offer at different levels of demand.

Below an example of a basic hotel rate grid:

When putting together your pricing matrix thake the following criteria into account:

Build your pricing points (BAR levels) as per expected level demand (High to distressed for each season)
Use a maximum of 12 BAR levels
Check the price compression from one BAR level to the next one

To determine what prices each BAR level should have it will help if you study at what rates you sell the most by channels, month and rate types. This way you will not miss out on any rate levels.

For example if we take a look at the past production per rate level below, we will notice that the hotel had a high production of room nights at BAR 6. It might be effective to move earlier to BAR 5 and sell at a slightly higher price, or if the demand does not sustain such pricing to implement a BAR of 85.00 to capture some of that demand.

We should also try to convert some of the demand for BAR 2 at 130.00. Some clear yielding opportunities that can only be analyzed if you work with BAR levels, instead of simply changing the rate in your PMS.

Below an example of a channel price production analysis for the GDS, in which we can see clearly that BAR 6 overproduced. This is yet another yield opportunity for your hotel.

Example of past production – GDS sales

Studying your historical pick-up for various demand levels, you will be able to develop a more advanced pricing grid for your hotel, and get a real powerful revenue management tool.

For more ideas click here: Revenue Management Blog

Patrick Landman - Xotels

On the Brink of Revolution: Dynamic Pricing in Hotels!

patrick@xotels.com (Patrick Landman - Xotels) — Sun, 03 Oct 2010 23:00:00 +0000

Sunday afternoon, a few clouds are setting over the terrace, a perfect time to put down on paper some thoughts on ‘dynamic pricing’ in hotels. Following the news lately I have come to think that we are on the brink of the dynamic pricing revolution in hotel revenue management ...

Even though dynamic pricing was first introduced in the hotel industry by chains like Marriott, Hilton and InterContinental in the early 2000’s, it seems we are only now starting to get onto the barricades in this hotel pricing revolution.

Just over one month ago IHG announced at the National Business Travel Association convention that following the success of a test with dynamic pricing in Asia-Pacific over the summer, it now seeks global adoption of dynamic pricing.

They implemented the strategy worldwide this spring, but have met some resistance. Upon inviting corporate clients in the APAC region to adopt the dynamic pricing model, over 1000 accounts signed up. Now they want move away from the hybrid model of offering both dynamic pricing in secondary and tertiary markets and fixed pricing in key markets and offer complete dynamic pricing to all corporate accounts worldwide.

The key to achieve this, as Stephen Powell, SVP of worldwide sales, put it, if good forecasting. If you can forecast your results accurately, you can show corporate travel managers what they will be paying, essentially allowing them to budget travel expenses more accurately.

Ok, so that is the hotel side of the story. What does the travel manager community have to say about it?

On September 6, in a publication of Business Travel News, I came across and article titled; ‘Dynamic Hotel Pricing Making Limited Inroads among Buyers’. It featured a survey of 221 travel buyers of which two-thirds said they did not use a dynamic pricing system. The dynamic pricing model has long been accepted on the airline side, it seems in the hotel industry we are still behind. The biggest challenge in gaining acceptance was accredited to the lack of transparency in hotel pricing. Hotels seem to have too much of a challenge controlling rates over the various distribution channels.

So it seems our earlier articles and discussions on rate parity and rate integrity are at the core of this dynamic pricing r-evolution.

Before we go any further with recent news, let’s look at the concept of dynamic pricing a bit closer. How does and should it really work. What are the up and downsides for all parties involved. Dynamic pricing simply means that you give your corporate clients a percentage discount of your BAR (best available rate) instead of a fixed (or seasonal) contracted rate. The corporate rates, and all other rate planes, basically adjust as yield is applied (up or down) to the pricing of the hotel.

Below a simple graph to visualize the mechanics of dynamic pricing.

The operational advantages of dynamic pricing for the hotel are quite obvious:

The time-consuming RFP (request for proposal) process is simplified, resulting in time and cost savings.
Rate loading into GDS (global distribution systems) becomes easier and more accurate.
Rate management is simplified as dynamic rates apply discount on the public BAR year round on all room types.
Tracking challenge of corporate accounts booking promotional rates will be eliminated.

From a strategic perspective, dynamic rates are ideal for revenue management, it truly allows you to perform the art of matching supply and demand at all levels. It makes me think of a famous quote of a pioneer in yield management, Robert L. Crandal, Ex-CEO - American Airlines;

‘If I have 2.000 clients in a given route and have 400 different prices, obviously I miss 1.600 prices’

For corporate clients there are important upsides as well:

Time and cost savings due to easier RFP process and faster negotiations. It will give travel managers more time to add greater choice in hotel product.
Chain negotiations are simplified.
Guaranteed lower rate than the public BAR (best available rate) and possibly even lower than negotiated flat rates on distressed days.
Increased availability and choice as no more black-out dates would apply and discount will be simply applied to all room types.
Last room availability becomes the new standard.
Ability to negotiate multiple year contracts.
No more need for re-negotiation like during the 2009 crisis. Rates are automatically adjusted according to economic trends. Another huge time and cost saver.

Despite these advantages, travel buyers seem to prefer flat-rate contracts, especially when we are talking about high production volumes with and individual hotel. CWT (Carlson Wagonlit Travel), published a brief back in July of 2008 (CWTVISION) stating;‘Overall resistance to dynamic pricing agreements stems from the fact that hotels have been slow to provide concrete evidence of fair or added value.’ Back then they advised travel buyers to continue to negotiate flat rates wherever possible.

One of the main points for advising travel managers to approach dynamic pricing with caution was that many hotels did not have the knowledge, skills and technical infrastructure to properly manage rates and availability; ‘ Although dynamic room pricing is said to mimic the sophisticated revenue management techniques used by airlines, few hotels, however, have access to the kind of revenue management technology employed in air pricing, as the investment is often too high for properties that function as individual cost centers.’

Those days are long gone. The hotel industry and technology has moved forward since, and is extremely capable to offer the right room at the right time at the right price to the right client through dynamic pricing.

So what do we need to do as hotels to finally unleash this revolution of dynamic pricing? We need to create trust, take away fear, and offer a feeling of security. We need to become a partner of our travel buyer and be able to tell him if he produces the same in 2011 as in 2010 what it will cost him.

It basically boils down to effective and efficient revenue management. If we can forecast accurately what our business will do in the year to come, we can tell our partners easily what the rooms will cost. We have to convince them with number, stats and graphs. By showing them what they will be spending on a monthly and annual basis, you will allow them to budget better their travel expenses, and become a valuable strategic partner.

Travel buyers tend to request a ceiling or cap rate, as they are afraid to dive into the unknown. A hybrid rate structure however is counter effective for the hotel. With ceiling rates nothing really changes from the old fashioned flat rate system actually. You would not save cost; actually it would signify a cost increase.

So you have to move to 100% dynamic contracts right away. To convince the travel buyer you need to be able to present detailed cost forecasts, and offer incentives like LRA (last room availability) and Best Rate Guarantee. Offer a long-term strategic relationship, possibly through a multiple year contract.

All talk and theory you might think. We actually tried with one of our client hotels that we manage. A large phone company was completely open to dynamic pricing when presented with credible numbers and a clear financial outlook.

We are on the brink of the Dynamic Pricing revolution. Let’s see who the real leaders of this rebellion will be…

Next step, dynamic rate for wholesalers, or are we moving too fast now?

For more ideas click here: Revenue Management Blog

Patrick Landman - Xotels

Hotel SEO Success Story

patrick@xotels.com (Patrick Landman - Xotels) — Sun, 19 Sep 2010 23:00:00 +0000

Besides consulting and executing revenue management for our hotel clients we have also been working on hotel internet marketing, search engine and website design with them. We wanted to share with you this week one of our hotel SEO success stories. The numbers and results speak for themselves …

Many hotel websites are developed without including proper keyword research and implementation of basic SEO (search engine optimization). Working on a hotel website design for an aparthotel company in Amsterdam, the Netherlands, we have followed a standard checklist and tips that can be found on the many blogs and internet marketing news websites.

Besides investing in a new functional website design this apart-hotel also invested strategically in a long term internet marketing strategy including continuous SEO, link building, online PR and social media marketing.

So what are the results?

A summary of this hotel seo case study:

Over 100% growth in traffic
Generic searches without the brand name have grown by 179%
The number of sources that generate traffic has increased substantially
ROI is beyond clear, making it a very worthwhile investment

Below you can see that in 2010 vs. 2009 the website has started to really grow since May, a few months after the implementation of the site.

In July, August and September growth has increased even further. Traffic is up 115% vs. last year. And the growth trend is continuing.

Non-branded keyword searches (generic searches not looking for a specific company) are up 179% vs last year. The website is being found on many more keywords…

How did we do this?

A clean, functional and easy to navigate hotel website design.
Keyword research and selection and the implementation of selective keywords and defined meta-tags per page.
Creation of themed landing pages with special offers.
Link building through online PR and Blog postings (no link farms!).
Implementation of a streamlined hotel booking engine and simplified reservation process.
Consumer oriented blog with expat tips.
Information sharing social media strategy on FaceBook, Twitter and Friendfeed.

And now the core question; How much revenue has this generated? ; How does it look in terms of return on investment?

The website has generated € 120.000 thus far. So the investment of the website has been paid for several times already. If we would continue at the level we would expect to generate €480.000 in a 12 month period. This puts the monthly internet marketing cost at 12.5%.

But of course the monthly internet activities are aimed at growth, which we did not yet take into consideration. We foresee the cost to drop below 10% in the near future.

All in all a more then healthy ROI case!

We see that hotels in general tend to be shy with investment in websites and online marketing. Getting something cheap will actually turn out expensive in the case of online marketing as you are leaving a lot of business on the table, needing more indirect business, paying more commission to online travel agencies.

Hope this will have give you an interesting perspective into the possibilities in hotel internet marketing and SEO. ROI is there if you are willing to invest in direct sales!

For more information on Xotels please click here: hotel marketing

Patrick Landman - Xotels

Hotel Sales Managers are too Weak

patrick@xotels.com (Patrick Landman - Xotels) — Tue, 31 Aug 2010 23:00:00 +0000

Over the last 4 years we have trained thousands of hoteliers around the world in revenue management and distribution. All have made the same remarks; the travel industry is too price driven, the competition is driving down the price of the market. My question; what are you doing about it?

It is so easy to point the finger at the competition isn’t it? It is always the hotel next door which is destroying the market by offering better corporate or wholesale rates. They undercut your rate in their negotiation to steel market share, and it just drives down the rate.

Many hotel sales managers have been attending our training courses and seminars on hotel revenue management, and the attitude above is what we experienced mainly. If asked what they would do to keep a corporate account from taking their business elsewhere, almost always price was the solution at hand.

Hotel sales managers are weak. They seem not to be trained in sales skills. Their only tool is price. They have no backbone when it comes to the bluff poker game of negotiations. They are ill prepared and have no data intelligence at hand to make the right decisions. They have only one fear: loosing the account.

Where is our industry going? How come these sales people who are supposed to make our hotels money do not have the right skills and attitude? Are they not trained right? Are we hiring under qualified staff, due to payroll restraints. We better get our act straight because we are eroding the value of our hotels from within.

Below our Xotels’ view of how sales in hotels should work;

Sales manager needs to have ‘balls’. He or she needs to have no fear of losing any account. Sales negotiations are like bluff poker; the other party will detect your fear and use it against you.
Based on budgets and targets revenue management strategies are defined. Corporate rates are based on this. Corporate rate buckets are created.
Accounts are analyzed on a monthly basis on production, stay patterns, commission costs, additional spending, and displacement.
Based on account production and preset parameters a corporate rate bucket is assigned as part of an overall strategy.
A thorough analysis of the strengths and weaknesses of competition has to be done. Sales managers need stay at competitor hotels to understand what they are up against. We need to copy the good from them and improve on our weaknesses.
We need to brainstorm on how we can deliver more unique service than the competition. The difference is in the little things. Personal service is highly valued by business travelers!
Just like with revenue management in corporate sales we have to add value instead of lowering rate. Free newspapers, office transfer, public transport ticket and free wifi are just a few of many options to package and add value to corporate offers.
Go into sales meetings with your numbers, just like your opponent. Show him where he fits in your budget. This way you position yourself as the stronger negotiation partner. The corporate travel manager will understand that if he wants in, it will only be possible at the price you offered.
Show no fear! If the corporate travel manager says he needs a better rate, simply reply that it does not fit in your budget. Saying no is the strongest strategy in a negotiation. Hold your ground!
Any corporate account that wants a lower price then has been budgeted, signifies a loss of revenue, and will need to be replaced by other business. Simply lowering the rate will set your hotel up for failure.

Hope this will help to get your hotel sales process on the right track again.

For more information on Xotels please click here: hotel management company

Patrick Landman - Xotels

20 Questions to ask before redoing your website

remko@xotels.com (Remko West - Xotels) — Thu, 19 Aug 2010 23:00:00 +0000

Stuck on increasing the number of unique visitors to your website? Still facing conversion ratios below 1 percent on your own website? You r website needs a serious makeover? Looking to integrate a social media strategy and a blog into your website? Think before you start.

Here’s a list of 20 questions and tips that you should ask yourself before redoing your hotel website design:

What is the goal of the site? Is the goal to generate revenue? Is it to maximize conversion? Is it to attract new customers, retain customers? Under ideal circumstances, what will the outcome be of your website? If your website has multiple goals, make sure you put them in the right order.
Who are you trying to please? If it's the boss, what does he want? Is it a designer? Or maybe your representation company that wants all hotels within the chain to be equal, and therefore all fantastic brochures (yes offline, and therefore also online) should look the same? Is impressing a certain kind of person important? Which kind?
How many people on your team have to be involved? The GM, Director of Marketing, Sales Managers, F&B managers, C&B managers, all department heads?
Who are you trying to reach? Is it everyone? Potential customers? Returning customers? Other businesses? Leisure customers? Business customers? Groups?
That group that you’re trying to reach, are there other sites that they already enjoy visiting? Maybe there is something you can learn from these sites.
Are you trying to sell something online? How easy should it be to buy for your visitors? Make sure the buying functionality (i.e; booking engine) is simple to use.
Is there a story that you’d like to tell? Are you providing your customers the right experience with that story?
Do you gain permission to follow up with your client?
Do you hope that your customers will watch you, and keep watching (following) you?
Do you need people to talk about you using certain social media? Do you need to be marketed virally?
Do people find the site via word of mouth?
Is there ongoing news and updates that need to be presented to people?
Is the site part of a larger suite of places online where people can find out about us, or is there this website only?
Do you want people to call you? Keep in mind that offline conversion is and will always be much higher than online conversion.
How often would you like people to come by?
Who needs to update this site? How often? How often can you afford to (fully) revise this site? Google is continuously looking for fresh content, so you should be able to generate new content, easily, yourself, on your website.
Does showing up in the search engines matter? Is it maybe more important then some of the previous points? Are you willing to sacrifice any? If showing up in the search engines matters, which keywords matter? Are you aiming for short tail keywords, mid tail, or long tail? How much do we want to spend to be found on all these keywords? Calculate this carefully, and just for fun, compare your website SEO cost to the commission that you pay your 3rd party websites.
Will the site need to be universally accessible? Do languages or browsers play a role?
How much money do you have to spend? How much time can we afford to spend?
How much revenue do you want to generate? What if you don’t make target? What if you go over, far over?

For more information on how to build hotel websites and how to market your hotel better, click here: hotel website design

Remko West- Xotels

Hotel Es Moli Mallorca outsourcing Revenue Management to Xotels

patrick@xotels.com (Patrick Landman - Xotels) — Mon, 02 Aug 2010 23:00:00 +0000

Hotel Es Moli in Deia (Mallorca, Spain) has decided to turn the curve and start offering dynamic rates. To increase online sales as well as direct sales they are outsourcing their hotel revenue management to Xotels, a hotel management company specialized in yield and distribution.

Patrick Landman of Xotels starts of: ‘The hotel has seen an erosion of demand and production by tour operators and traditional feeder markets over the last several years. An independent market study and internal audit have demonstrated change of strategy is needed. Through our extensive network this beautiful resort property came in touch with us on our hotel revenue management services’.

Remko West adds ‘We are looking for unique properties in each market to take over the revenue management and online distribution. Xotels is currently expanding form managing mainly city hotels into resorts. The exceptional location and surroundings of www.esmoli.com made it a natural and perfect fit. ‘

Patrick Landman continues, ‘Es Moli is an amazing property. The resort has a unique loyal clientele with a guest repeat factor any hotel would be jealous of. It just needed to add more dynamics to its strategy. This is where Xotels comes in. With our international experience in revenue management and online distribution of hotels we will be able to raise REVPAR and GOPPAR quickly for them.’

Remko West finishes ‘It is yet another property addition in a short time in our vast growing hotel management portfolio of revenue management services and outsourcing. Our expansion in Europe is moving along quite rapidly. Additionally we are now getting hotel management requests for properties in Asia, Africa and the USA.’

For more information click here: Hotel Management Company

Cheers,

Patrick - Xotels

Rate Parity or Rate Disparity

patrick@xotels.com (Patrick Landman - Xotels) — Thu, 22 Jul 2010 23:00:00 +0000

Wake up! Stop dreaming… all this blah blah blah about rate parity… please, give me a break… it doesn’t exist!!! When will hotel finally get it and start understanding that as long as they do not become more professional in their revenue management they will not control their rate integrity…

Meta-search has destroyed the dream of many hoteliers. The sweet thought that we control our rates online has been crushed. Kind of naïve no?

How come? We control our rates no? We almost all use channel management systems and have revenue managers (aka glorified reservation supervisors). But still we can’t get it under control.

Or at least we thought we did till meta-search sites like Kayak, HotelsCombined and Trivago got big. These price comparison websites shop the hotel prices on many different websites. And the websites include tour operators and wholesalers. Yes your FIT rates can be found online.

But not only this creates the rate mess offered by hotels. We shopped the top 5 hotels on Kayak.com and HotelsCombined.com for New York, Las Vegas, London and Paris. Destinations where you would expect top hotels to have their house in order. Sorry, not even the glorious Intercontinental has it under control.

We have found rates to vary at least €20 / US$ 25 with some hotels. But many hotels show rates differences of up to € 100 / US$ 125. Amazing no? Below some slides to show the rate shop results…

Want to get it right, and increase REVPAR + GOPPAR? Check out hotel revenue management by Xotels

Cheers,

Patrick - Xotels

Xotels signs yet another Hotel Management Contract

patrick@xotels.com (Patrick Landman - Xotels) — Thu, 22 Jul 2010 23:00:00 +0000

Xotels has established itself as an entity among hotel management companies in Europe. It has signed yet another hotel management contract, taking on the revenue management, distribution and marketing of the Hotel San Sebastián Playa in Sitges.

Patrick Landman co-founder of Xotels states, ‘Besides managing city hotels we are now also moving into the resort hotel market. Our as a hotel management portfolio continues to grow. It is the 4th property we have signed up this year‘

Remko West, the other co-fouder of Xotels, adds: ‘With our strict systematic approach we are capable of delivering better results to hotels. In general we increase REVPAR between 10% - 25% for hotels within 2 months time. In the long run we work GOPPAR, and improve the overall bottom line of the hotel. Profit is the only thing you can carry to the bank’.

Patrick continues ‘The Hotel San Sebastian Playa in Sitges is a great addition to our hotel revenue management portfolio. Earlier this month we launched their new website, www.sitges-hoteles.com. It is already prepared to also list next week their new hotel, Avenida Sofia Hotel Spa, opening in the end 2011. As you can see we are planning far in advance. Proper strategic planning is the only way you to outperform the competition. ‘

Patrick Landman finishes, ‘We have a few more deals in the pipeline and expect to sign 2 to 4 more hotel revenue management contracts this year. We are in negotiations to take on properties in Greece, Spain and Belgium.‘

For more information please click here: hotel management services.

Cheers,

Patrick - Xotels

Evolution of Hotel Pricing

patrick@xotels.com (Patrick Landman - Xotels) — Tue, 13 Jul 2010 23:00:00 +0000

Today we decided to take a look back at the history and evolution of pricing in hotels and distribution. A lot, really a lot has changed in hotel revenue management over the last 10 years. It’s funny how quickly we have adapted to all new developments like it has been like this for ever…..

The growth of internet distribution has had the deepest impact on our rate strategies. With rates being distributed publicly on such a large scale, even corporate and consortia contracts are being pushed to become more dynamic and competitive. It is a pure natural development.

Of course this couple with the wide spread implementation of revenue management cultures and yield strategies in hotels. No longer are we working with static seasonal rates, even in many resorts.

Here an overview of some historical highlights in the evolution of hotel pricing:

1998 - Priceline introduces Opaque rates
2003 - Industry wide acceptance of the Rate Parity concept
2003 - Marriott and AMEX change fixed prices to dynamic pricing
2003 - Opaque rates grow, as Expedia scoops up Hotwire
2004 - Hilton and Intercontinental stop using fixed rates with Consortia
2004 - Wholesalers and FIT’s start publishing offline rates online
2004 - Introduction of Dynamic Rate Rules (stay 4 pay 3 discounts) by OTA in order to get more competitive rates, and break rate parity
2005 - Accor moves to dynamic pricing model and reduces allotments
2005 - Hyatt and Starwood introduce flexible pricing models to selected corporate accounts
2006 - Introduction of B.A.R (Best Available Rate)
2006 - Introduction of Non-Refundable and Pre-Paid rates on hotel’s own websites
2007 - LRA - Last Room Availability on corporate contracts being questioned
2008 - More acceptance by corporate accounts of rate derived from a Floating BAR
2008 - Meta-search websites like Kayak and HotelsCombined offer price transparency across the web.
2008 - OTA’s launch hidden or secret hotel program to compete with Opaque rates
2009 - Resort Hotels moving more and more away from seasonal into dynamic pricing
2009 - OTA add value added promotion packages, at preset rates. By adding value and masking the rate, hotels feel that their price integrity stays intact
2009 - Direct PMS interfaces make OTA give up guaranteed allotment for Last Room Availability
2009 - Wide spread publication of Opaque and Wholesale / FIT rates, breaking the Rate Parity strategies of hotels.
2010 - Flash Sales introduced by OTA's = temporary discount, even for just one hour to pick up a few extra occupancy points.
2010 - Google is testing to display rates in hotel listing on Google Maps

I am not sure if we got all the years exactly right, but that is beside the point. Important fact is that in a few years time decades of hotel pricing strategies became outdated.

Don’t be surprised if overnight new developments come about. The OTA and Travel Websites continue looking for creative ways to obtain more competitive offers than their competition. Best Rate is still the name of the game in online sales.

With the move of Google into meta-search this month, the rate parity struggle by hotels and competitive battle between OTA will only intensify. And with the social media and networks changing consumer internet behavior we certainly have interesting times ahead of us.

If you want to learn more about revenue management click here: revenue management courses

Patrick - Xotels

Hotel San Sebastián Sitges launches new 2.0 Website

patrick@xotels.com (Patrick Landman - Xotels) — Tue, 06 Jul 2010 23:00:00 +0000

Hotel San Sebastian Playa has launched a new hotel website design. Following the trends of social media, online reviews and content sharing, a new web 2.0 platform has been created that connects effectively with the need of their guests.

Fabian Sanchez of Sitges Gastronomico comments, ‘A makeover for our website has been long overdue. We have been looking to implement a new website that is more aligned with the wishes of our guests.’

Patrick Landman of Xotels adds, ‘We have introduced some great new web 2.0 features in the first version of the website. We included the CoolIris piclens to image display much more interactive. The weather, date and time, Skype call and chat, Facebook and Twitter follow options are some of the basic web 2.0 modules. Another cool thing is the Google Street View Spin, as well the Google Directions in the hotel location page. We are putting the finishing touches on the integration of our hotel review page, which will be pulled directly from TripAdvisor. This is all functionality that adds to the stickiness of the hotel website.’

Below some ideas of the web 2.0 modules:

Cool Iris Pic Lens

Google Streetview Spin

Fabian continues, ‘We are extremely pleased with the first release of the new website. The location page is really cool. Next step will be to add more information on our new hotel, the Avenida Sofia, which will be a boutique design hotel. We are also expanding our hotel SEO and social media marketing efforts with the services of Xotels. We are working together on a long term strategic plan to become market leaders in Sitges and the Costa del Garraf of Catalonia, Spain’.

‘We will also add a concierge blog the website to bring the guests up to date with events that take place in Sitges, restaurant and nightlife recommendations, and talk about activities that can be done during the vacation. Sitges is a very active and happening destination, so there will be lots to write about. We also plan to report on the progress of the construction of the new design hotel Avenida Sofia.’ Patrick finishes.

For more information on how to market your hotel in this social media era click here: hotel marketing

Patrick - Xotels

When will hoteliers wake up?

remko@xotels.com (Remko West - Xotels) — Wed, 30 Jun 2010 23:00:00 +0000

Jean delivers my newspaper. He comes by on his bicycle early in the morning to drop off his papers. He’s a pleasant guy. He always waves at me in the morning when he sees me. Sometimes he even stops for a chat. I used to get ‘Le Soir’ and ‘De Standaard’. I stopped ‘Le Soir’ last year, trying to save some money.

I am going to do the same with ‘De Standaard’. I now subscribe electronically to various news platforms and receive my news directly into my Netvibes account. I only receive information about stuff that holds my interest. And it’s free.

I will admit that it was hard to stop ‘Le Soir’, I have been reading it for years. But I never read longer than 5 or 10 minutes, over breakfast. Internet, and thus my new way of getting the news, is always accessible. So in the end the conclusion was logical. When I cancelled they started a program of calling me with increasing discounts to get me back as a paying customer. No way am I ever going to pay for something that I can easily get for free.

A year later, I am now trying to screen their calls so that I can ignore them.

Now Jean is getting involved as well. Every now and then he drops ‘Le Soir’ off with a note, saying that it’s free. He doesn’t get it. His business is changing. A paper loaded with advertising is no longer welcome with me, electronic information is. Electronic delivery saves trees, it saves time, it’s more accessible and it works. I have exactly what I want. Someday Jean and I can meet early in the morning at my doorstep, and I'll explain that to him, if he wants.

Unfortunately, he will eventually be one of the casualties of the digital age. Possibly ‘Le Soir’ will be too. Their management clearly doesn't get it. They are trying a digital edition that as far as I am concerned turns out to be nothing. It has too much advertising, little valuable content, way too many annoying pop-ups, and therefore it is disfunctional.

It strikes me that only few people have a clear view of what is really going on. Are there really so few to understand that newspapers will disappear now that information, from trusted sources, is available for free? That customers are changing, that they have moved online? That this impacts businesses?
Brochures, paper advertising. It no longer works, it’s about to disappear.

For hoteliers the world is changing rapidly as well. Advertising in brochures and with offline travel agents is dying fast. Some hoteliers understand that downturn will hit them again if they do not change fast. They do the right thing to recover from 2009 and do not rely on traditional methods, steep price discounts to attract old business.

Instead they invest online in their website, in SEO and optimize new channels in order to find new customers. They rebuild a brand via social media strategies, and they are finding new ways to create and maintain relations with customers. These hoteliers are now in the middle of the upturn, and are turning into market leaders. These guys clearly get it.

The other managers? They're a bit like Jean and the publishers of ‘Le Soir’. They're trying to use price discounts and brochures in an attempt to bring back customers who are permanently gone. Using price discounts to stimulate customers who temporarily don't need or want a product just reduces their perceptions of value and loyalty. When they come back, they'll expect the same lower prices, and the sellers will wonder what hit them–where have all the profits gone? They just don't get it.

For more information on how to market your hotel better during this new digital era click here: hotel marketing

Remko - Xotels

Hotel Blog and Management Tips - Ideas for Hoteliers - by Xotels

2011 Top 10 Revenue Management Blog Posts

Xotels Reports 20% REVPAR Growth in 2011

Order Takers vs. Personalized Sales. How Effective is Your Hotel Selling over the Phone?

2012 Hotel Industry Outlook : A Distribution Shuffle

Spa Revenue Management Techniques : Dynamic Pricing, Dynamic Availability & Menu Engineering

Hotel Asset Management has Changed Forever

Xotels expands into Canary Islands with 2 Resorts in Lanzarote

Revenue Management Does Not Apply for Resort Hotels

Are your 2012 Hotel Targets, Budget and Marketing Plan Ready?

Strong Q3 REVPAR Results for Hotels across Europe

KPI for Spa Revenue Management: SUR, ATR, REVPATH, SREVPOR

1. Spa Utilization Ratio (SUR)

2. Average Treatment Rate (ATR)

3. REVPATH

4. SREVPOR

How to use QR Codes as a Hotel Marketing or Guest Service Tool

How to Market a Hotel? in 10 Steps

1 - A Story Worth Telling

2 - Regional and National Press

3 - GDS + Consortia

4 - OTA

5 - DMC

6 - Tourist Office + Convention Buro

7 - Sales Rep

8 - Website + SEO

9 - Social Media + Review Website

10 - Mobile

Top 10 Social Media Marketing Tips for Hotels

15% REVPAR Increase for Independent Hotels in Europe

How to become number 1 on Tripadvisor

Why Hotels must apply Revenue Management to their Spa

How to Run a Professional Hotel Blog

Xotels adds Flagship Property to its Hotel Management Portfolio

How serious do hotels take Guest Feedback?

A penny for each time I have heard “Revenue is great, but can’t be applied in my hotel”

FaceBook, the New Hotel Search Engine …

Hotel Brand Hijacking by OTA, it should be banned …

Xotels Management Group adds Hip Hotel St Martenslane to its portfolio

a Year of Flash Sales and Price Wars in Hotels

REVPAR up 12% - 26% in 2010 @ hotels of Xotels

Online Reputation Management Tool for Hotels

Top 10 Revenue Management Blog Posts of 2010

Rudolf and Elfie break away from Santa this Xmas

How to Distribute your Hotel Online to Capture Groups

Group Pricing Strategies for Hotels

Revenue Management Tips - Video 1

Revenue Management Outsourcing is the New Trend

Many Revenue Managers Lack Basic Skills

10 Reasons to lower your hotel internet marketing budget

Best Hotel Website Design

Rate Parity as a Revenue Management Tool

Managing Price Sensitivity in Hotels: Lastminute Deals vs. Early Bird Offers

Hotels Wanted, Dead or Alive

Hotel Pricing Matrix

On the Brink of Revolution: Dynamic Pricing in Hotels!

Hotel SEO Success Story

Hotel Sales Managers are too Weak

20 Questions to ask before redoing your website

Hotel Es Moli Mallorca outsourcing Revenue Management to Xotels

Rate Parity or Rate Disparity

Xotels signs yet another Hotel Management Contract

Evolution of Hotel Pricing

Hotel San Sebastián Sitges launches new 2.0 Website

When will hoteliers wake up?