The International Network of Hospitality Consulting Professionals

Take Your Guest Reservations Back Offline

 

Remember 20+ years ago, when your hotel guests could only book direct via phone, your brand’s 1-800 number, the brand website and your own website. Ahhhh…The good old days when you got to keep 100% of the rate.  (Except when a Travel Agent booked for the guest and then you simply had to a pay a bargain 10% commission.)

Then, the OTA’s came into the picture around 1996-97 claiming anywhere from 15-30% commissions.

Allow me to run through the brief history of how the marriage or shall I say dysfunctional marriage between hoteliers and OTA’s has transpired.  In my many years of hotel sales and marketing experience, I have personally observed this landscape change and continually transform.

In the beginning, I remember being a Front Office Manager and being fined by my brand franchisor for violations of lowest rate guarantee.  It was a learning curve as we Hoteliers were trying to navigate around this new technology of its time.  Rate Parity Policies and its related processes have certainly become more streamlined.  Online Travel Agencies have come and gone, yet most have been merged to form a few powerhouses.

There is really no need to look back on additional historic points as to how we arrived on the scene today; both OTA’s and Hotels are here to stay.  The real question is how we can co-exist and how can we as hoteliers drive more guests to book direct which is our most profitable booking channel.  The OTA’s of the world are becoming ever so much more clever at grabbing the attention of the guests we eventually host.  OTA Loyalty programs are just one example.  Another would be the Millions of Dollars spent on advertising to lure our potential guests into using their services.

One strategy that absolutely confuses consumers is Google AdWords Campaigns that populate an OTA over a Branded Website.  Here is one example:  A guest googles “Brand X in City Y” and a listing pulls up in the #1 spot.  They proceed to call the 1-800 attached, or book direct online thinking they are working directly with the property when in fact they are booking through an OTA.

In my hotel operations experience, I have seen this happening several times each week.  Guests will swear that they called the hotel direct and booked their room.  Now why can’t they cancel with the hotel directly?  Why did they not get the specific room type they thought they would get?

There are three specific strategies that I think we as Hoteliers should implement in order to pull our guests back offline and back to booking with us direct:

  1. Re-train our front desk staff or reservation agents to become more inquisitive when speaking with an incoming caller.  Prior to calling your hotel, a guest has most likely been searching various OTA’s regarding your hotel and some are online at the time they call your hotel.  With specific training, your agents can book those guests right then and there and avoid a customer booking on an OTA.
  2. We need to advocate that our National and International Brands run a joint and entire industry campaign to educate consumers as to the benefits and pitfalls of booking with an OTA versus Booking Direct.  A campaign that is not brand specific, yet more of like a Public Service Announcement in form.  Note, I did say there are some benefits for some consumers with booking with an OTA.  i.e. convenience of booking hotel, air and car is one of them.
  3. Continue to educate our customers who booked on an OTA, that upon their return visit to book direct.  Inform them that they can get the best rate by calling direct and they also have more control over reservation changes and/or cancellations.

The relationship that we as Hoteliers and OTA’s have isn’t the perfect marriage made in heaven, but we can make the best of it by taking even a small percentage of our guests back Offline and back to booking with us direct.  It is time that us hoteliers put more money back into our own pockets! Figure out how many rooms you should dedicate to OTA’s.

If you have any questions or concerns, feel free to contact us!


About the Author:

Jay HartzJay Hartz, CHA is Owner of Next Generation Revenue Per Available Room, LLC which is a sales and marketing Training and Consulting Firm. He has a proven track record in Sales & Marketing with his main focus on direct sales training and development, social media platforms, leveraging technology, and customized marketing plans.

Obstacles in Restaurant Performance and the Transition of Responsibility

Obstacles in Restaurant Performance and the Transition of Responsibility

Obstacles can be a significant constraint to restaurant performance and can create reasons for employees to resign, customers to leave, and profits to diminish, with owners and managers contrarily disregarding the constant remedy opportunities employees offer them. Although my focus of profession is hospitality consulting, the fact of the matter is that obstacles are in every company. It does not matter the type of business you own or manage, as obstacles are present and can even hinder your culture if they are not recognized as limiting the service abilities of your staff.

Obstacles can be anything, but in restaurant performance they can be preparation limitations in a poorly designed kitchen, a coffee machine that has only one working heating element, an ice machine that continually breaks down, or a walk-in refrigerator that has no room to even walk in. Add them all up in your business and then look at performance issues.

These common types of obstacles prevent employees from being effective in their role to the owner or manager, but are not always considered when an employee is being charged with poor performance. The obstacles that are occurring in your business may transition to interference’s against your employees, conceivably resulting in a complaining employee, poor service, and unhappy customers.

Time after time the expectations we place on employees are jammed by obstacles that encumber their role in service. In almost all instances the burden of poor service falls on the employee when in fact the owner or manager can be directly at fault for these instances. How often has an employee informed an employer that a door causing concern needs fixing, or there is not enough silverware in stock to accommodate a party, or shelving is not sufficient to properly manage inventory, or a piece of equipment is in disrepair but everyone must use it. Many employers just say deal with it, and go on with their misunderstanding of why their business has slowed, or staff has left. Address these circumstances and perhaps a different outcome can prevail.

My contentions that employers do not consider conditions that may prevent an employee from performing to the level of expectations is real and common, and in my view a direct reflection on the performance of the manager or owner. When employees decide to leave for reasons like poor working conditions, management must consider the obstacles in their business that if addressed, could have prevented these failures. Eliminating obstacles that directly affect employee performance can result in better service, gratified staff, and reduced turnover.

Solutions to obstacle are not always easy, and there is generally a monetary value to result an obstacle. However, when your business thrives on service and you have areas in your shop that are preventing your team in their performance, fixing obstacles becomes more valuable to your bottom line then the commonplace action of inaction.

Today I want you to walk through your business and observe, and accordingly, ask a question to your employee’s specific to what is preventing them from doing their work. If you can, really pay attention to what you see or hear, and perhaps fix your obstacles. While this may not be the only reason for restaurant performance issues, it goes a long way with employee appreciation.

If you have any questions, feel free to contact us!


About the Author:

Jim LopolitoJim is president of Lopolito Hospitality Consultants and a veteran of the restaurant, country club and catering industries offering expert operational review, club management consulting, foodservice training, and team development. His consulting services include his proprietary “Expense Loss Review” program. The ELR program reviews variances between money that is currently unsystematically expensed on product, services, or equipment and the amount expensed upon our review and implementation of practical methods of spending behavior. Jim has worked in virtually every position in foodservice, from executive chef to general manager in restaurants, country clubs, and catering in well-known organizations throughout New York. His background includes 12 years in restaurants, 19 years in private clubs, and 10 years in high-end catering and concert production.

Why Do You Need a Hotel Quality Assurance Audit?

Why Hire a Hotel Quality Assurance Consultant?

The first question is why? Why do we need a Hotel Quality Assurance Audit? Don’t we know how our hotel operation is performing? Our customers complete our guest satisfaction reviews and we compile the data. We speak to our customers every day and they aren’t shy about telling us what works and what doesn’t. TripAdvisor and other social media sites provide us with daily feedback.

All this is true, but it isn’t always a good idea to grade your own paper – especially if you want the real answer. Often guest satisfaction reviews, social media posts and direct customer feedback is like listening to the loud voices and missing the overall opinion.

Customers who fill in your surveys or take the time to give you direct feedback are often the customers who had a particularly bad or good experience. Of course this allows you to address a specific customer issue, solve a problem and/or reward your staff for a job well done. But are you really getting the feedback you need from your everyday customer?

An objective, non-biased third party perspective will provide the candor you need to take your operation to the next level. Or the competitive environment is changing and you need to adapt. Or you may be launching a new product or service and you want to focus on specific issues.

A hotel quality assurance audit will provide a wealth of information you may only be guessing at or it may simply confirm your direction. Yes, there is a cost involved, but if you are truly open to candid feedback and willing to put the effort into the follow up it is worth the investment. Just remember it is your responsibility to use the information and get the return.

Determining Who To Hire to Perform Your Hotel Quality Audit

The next question is who? Who does this kind of work and how much will it cost me. If you Google hotel quality assurance audits you will get a list of providers who all have glowing things to say about themselves – “mystery shopping data delivers hotel operations with precise feedback”, “customer experience measurement that helps you identify and measure the moments of truth”, “we will be your eyes and ears to ensure your service delivery matches your brand promise”, “a concise audit consisting of over 1000 touch points”, and so forth.

These services provide an objective point in time front of house guest perspective that is typically data focused. You have the responsibility to analyze the data, develop appropriate action plans and execute your plan – similar to what you do every day, but now you have additional data. The typical price range for a one-time inspection of this type of service is from approximately $600 to $1800 depending on the size and complexity of your operation. However, the real value of this service is in frequent inspections that allow you to measure progress over time against an established baseline.

If the thought of analyzing data from over 1000 touch points seems a little daunting, there are also services that are conducted by hotel industry professionals that provide both a front of house guest perspective and a back of house employee perspective. In addition to the quality assurance review, these services typically include an operations analysis of your property’s operations strengths and opportunities, probable root cause and recommended solutions. In other words, rather than provide a data-focused checklist that requires your analysis, these services take it a step further assisting with the analysis and defining solutions.

This is possible because a hotel industry professional is conducting the review and analysis rather than “Joe Guest” completing the Mystery Shopping Checklist. Obviously, this alternative is more expensive and pricing is dependent on the size and complexity of your operation and the scope of the review you agree to. Pricing can be more reasonable if you agree up front to contract with the firm to assist you with the ongoing execution of your improvement plan.

Thoroughly confused? It isn’t really as complicated as it may sound. A little time on the various provider websites and some phone calls will clear things up. Most providers will want to thoroughly qualify your needs and expectations before proposing a service and pricing. The services are typically customizable and providers have an interest in delivering what you want the first time in hopes of developing a longer term relationship. The key is to determine what works best for your property and your current situation.

If you’re considering hiring a hotel quality audit consultant, contact Cayuga Hospitality Consultants today. We can answer any questions that you may have!


About the Author:

Chuck KelleyChuck Kelley is a Partner with Cayuga Hospitality Consultants a network of independent consultants specializing in hospitality/lodging. He spent 32 years with Marriott International, beginning as an Assistant Restaurant Manager and worked his way up to Executive Vice President responsible for Marriott’s Caribbean/Latin America Region. Along the way he held positions as Director of Restaurants, Director of Marketing, Regional Director of Sales and Marketing, General Manager and Country Manager Australia. A graduate of the University of Hawaii, with a BS in Travel and Tourism Management. He is an active member of the Baptist Health South International Advisory Board and previously served as Chairman of the Caribbean Hotel and Airline Forum for the Caribbean Hotel and Tourism Association. He served with distinction in the US Army in Vietnam having earned a Purple Heart and Bronze Star for valor in combat.

Brush & Co. Lodging Notes and Random Thoughts – March 2018

March is certainly coming in like a lion – weather “events”across the nation – although here in South Florida we seem to be enjoying an early Spring.cauldron_of_gold.jpg

Hopefully your positive expectations for 2018 will be fulfilled – and surpassed – and you will find a real pot o’gold!

 


More From The Not-Quite-Crystal-Clear Ball

” U.S. Hotel Industry to Sustain Modest Growth in 2018” according to Zacks Equity Research as reported in Zacks.com. Consistent with the projections from STR, CBRE and PwC, the article indicates that “Despite the prevailing challenges such as unfavorable government policies, uncertainty in specific markets and RevPAR pressure, economic fundamentals appear strong enough to support modest growth in the hotel space in the short-to-medium term, and without any additional stimulus.”

Hotstats.com reports for ” January 2018: RevPAR Grows But Profit Slips for Hotels in the USA“. Profit per room dropped by 0.5% in spite of an increase in revenues as RevPAR grew by 0.6 percent due to increases in both occupancy and ADR.

” CBRE: Supply Growth to Peak in 2018” as reported in Hotel Business. In the recently released March 2018 edition of Hotel Horizons, CBRE Hotels’ Americas Research “is forecasting the net addition of approximately 101,000 rooms to the U.S. lodging supply inventory during 2018, an increase of 2% over 2017 average annual daily supply. This is the largest number of new rooms to enter the market since the 130,000 rooms that came on in 2009.”

Lodging Econometrics in an article in Hotel Business on the ” U.S. Hotel construction Pipeline – Present & Future ” says that 975 hotels/116,838 rooms opened in 2017, a supply growth rate of 2.3% and estimates that 1,145 projects/130,209 rooms will open in 2018, a supply growth rate of 2.5% and an increase of 17% in the number of projects.  Upper Midscale hotels represent 47% of the pipeline while Upscale represents another 32%.

” Nationalism is a threat to hotel industry says Marriott’s CEO “. In an interview with BBC journalist Tanya Beckett backstage at IHIF in Berlin, Arne Sorenson, referencing the Brexit vote, Donald Trump’s election and a swing in opinion against immigration in many countries, said: “The risk for us in the travel business is that even though travel is different than immigration, if people aren’t careful about the way they talk about it, they seem to be the same issue.”

Suzanne R. Mellen, Senior Managing Director and Practice Leader of HVS Consulting and Valuation, article ” Impact of Countervailing Forces on Hotel Values and Cap Rates “indicates that “After more than five years of relative stability, new factors are at play in the hotel investment market that will affect hotel capitalization rates and values in a changing economic landscape. Hotel sales transaction activity declined in 2017, while cap rates continue to rise modestly, and hotel values held stable. The outlook for 2018, while uncertain because of the changing political and economic landscape, is more positive than a year ago due to the tax reform’s favorable treatment of commercial real estate and a more optimistic business environment.”

Brookfield Asset Management Inc., Canada’s largest alternative asset manager (and the 2014 buyer of Thayer Lodging Group, Inc. which makes it a player in the hospitality industry) said in an article in Bloomberg – ” Brookfield Selling Assets to Build War Chest for Next Downturn” – that “We see no signs of underlying economic issues, despite the U.S. economy being nine years into this expansion. While this economic cycle shows no immediate signs of ending, it is clearly in its mid- to later-stages of an elongated expansion, and so we are being cautious, preparing for less robust times.” Cause for caution includes equity markets hitting record highs, government bonds historically expensive, corporate and high-yield spreads at record lows, and “bitcoinmania” taking hold, creating a market capitalization of $500 billion with “as far as we can tell, zero intrinsic value.”
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Branding/Un-branding/Collecting

Hotel Owners and Brands need to work together, but it’s not always a happy combination.  A lot depends on who holds the most “cards” in any relationship. An article based on comments at the IHIF in Berlin entitled ” Hotel owners increase demands on brands ” is a look at current thinking. “As costs increase and the price of assets rise, brands must work with owners to increase efficiency and productivity. And while hotel owners remained committed to the global flags, they are still insisting on more transparency and greater emphasis on the contribution of F&B and non-rooms income.”

Brand Finance’s annual report on the most valuable hotel brands “Hotels 50 2018” lists Hilton as the most valuable hotel brand, but down 24% from last year while Marriott is listed second but up 8% while Hyatt, at third, dropped 13%. Top 5 largest positive changes in value include Jinjiang (+71%), Quality (+54%), Melia (+52%), Comfort Inn (+41%) and SpringHill (+40%). The bottom 5 value changes are: Hilton (-24%), Crown (-26%), Novotel (-26%), Four Points (-35%) and Sheraton (-50%). “The report goes on to also rank the 10 “Strongest” brands

Carlson Rezidor Hotel Group is now Radisson Hotel Group and John Kidd, the new CEO says “Carlson has a different future now as Radisson Hotel Group ” as reported in Hotel Management. At the same time Hotel Business reports that ” Radisson Ups the Ante With New Collection, Loyalty Refresh “. The Radisson Collection – which replaces “Quorvus Collection” – is “a premium collection of hotels in landmark locations” bringing together “the most distinctive hotels in the Radisson Hotel Group portfolio, with 14 hotels confirmed to join the collection following the launch” this summer. This collection joins the “Luxury Collection” (Starwood/Marriott), “Autograph Collection” (Marriott), “Ascend Collection” (Choice), Curio (a Collection by Hilton), and, I assume, forthcoming “collections” from all brands that don’t yet have one.

Collections are an attempt by chains to bring into the fold properties that really don’t fit their prototypes for existing brands. The other approach for some unique properties means going “independent” and associating with groups such as Preferred Hotels. Jena Tesse Fox reports in Hotel Management that ” Deflagged hotels a boon for Preferred Hotels & Resorts“. Growing numbers of independents are “a sign of the growing strength and acceptance of independent hotels by the traveling public, and their appeal to owners” according to Philipp Weghmann, EVP of Europe for Preferred.

HotelNewsNow in an article by Sean McCracken says “Independent hotels enjoying a strong transaction market” as more and more traditional lenders and hotel investors view them as viable and perhaps even desirable targets. Data from STR shows 125 independent properties were sold in the U.S. in 2017, including the $515 million Pacific Beach Hotel Waikiki (839 rooms at over $600,000 per room). On a per room basis was the 80-room Hotel Yountville at $1.2 million per key. “Through the course of the year, independent hotels should for an average per-room price of $202,000, which as more than the average for branded upper-upscale properties ($190,000) but less than half that seen for luxury branded hotels ($423,000)

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Airbnb

Airbnb continues to morph. Skift report that “ Airbnb is Set to Launch a New Tier of Select Properties “. Airbnb Select is a program in which selected hosts with high ratings and reviews can be part of a curated collection of listings that undergo an inspection and professional photography process as long as they meet a lengthy checklist of requirements for particular amenities and safety features. The listings will show up more prominently and they may be able to raise their rates. 

 

Getting closer to being hotels???? Another change – ” Airbnb does the inevitable: Invites more hotels to platform “. As reported in an article in Hotels, Airbnb’s announced independent-minded hotels that meet standards can list their rooms on the Airbnb platform. Add this to last year’s article in Skift “ Airbnb Experiments with Hotel-like Concept Outside Orlando “. Airbnd will partner with a real estate developer on an apartment building – “Niido powered by Airbnb” – that will allow residents to share their apartment for up to 180 days each year. 
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This n’ That

  • As an industry, tourism in its many forms uses a large number of immigrant workers, some are illegal whether the employer knows it or not but most are currently legal under one form or another. Many of the legal workers may lose their status as TPS (Temporary Protected Status) is being revoked for some. There are currently 300,000 foreign nationals with the largest numbers from El Salvador (195,000), Honduras (57,000) and Haiti (55,000). The Center for Migration Studies of New York estimates 81 percent of the over 32,000 Haitians with TPS in Florida are in the state’s workforce and may need to be replaced. There is already upward pressure on wages and replacing the lowest level employees will only get more difficult/costly.
  • The AHLEF has launched a pilot program to offer degree programs that employees for ten hotel companies participating will be able to pursue higher education at no cost to the employee – certainly a “benefit” for many. I was originally drawn into the teaching by one of my college professors who was building a program to allow current industry employees to work toward their Bachelor’s degree while still working full time. Classes were held in various hotels here in South Florida and the hotel got a complimentary class for one by providing a classroom. I hope that the AHLEF program succeeds and grows.
  • The telephone department has already lost its status as a line item on the P&L summary and recently Robert Mandelbaum, Director of Research Information Services for CBRE Hotels’ Americas Research has penned an article “Other Operated Departments Become Even More Minor” He points out that guests’ use of their own devices has resulted (between 2010 and 2016) in a decline in revenues from both telecommunications and movie rentals of over 50 percent while profits dropped by over 60 percent. Guest laundry and valet revenue has declined by over 14 percent while profits dropped over 40 percent.
  • The prolific hospitality industry pundit Stanley Turkel has written the 192ndinstallment of his series “Nobody Asked Me, But . . . No. 192; Hotel History: The Negro Motorist Green Book” which was published from 1936 through 1966.  The article, in Hotel Online, explained that it enabled the black traveler to travel when “faced (with) a swamp of Jim Crow laws and racist attitudes which made travel difficult and sometimes dangerous.” I remember speaking with an older (older than me at least) gentleman who recalled (with embarrassment) a time in the 1950’s when as manager of a Howard Johnson’s restaurant in Savannah, he was required to refuse service to a black couple.  It is not that long ago.

About the Author:

Scott Brush is a former member of Cayuga Hospitality Consultants.

Cayuga Hospitality Consultants Announces New Services Division – Hotel Quality Assurance and Hotel Operations Analysis

With each of our consulting professionals possessing an average of 30 years of hands-on experience, Cayuga Hospitality Consultants excels in providing owners, operators and lenders expert insight and guidance through its new Hotel Quality Assurance and Hotel Operations Analysis programs.

The first question many will ask is simply “why do I need this type of service,” and the answer is for several reasons. You may think you gather all the customer satisfaction data from your internal surveys, from TripAdvisor and other social media. However, this information can be less than objective as the respondents may have personal reasons for completing the surveys or commenting in the public eye.

In addition, new competition may have recently entered the market, if so, the competitive environment has changed and you need an objective opinion on how this may have changed your position. You may be launching a new product or service and need a quick read on how it is perceived. And perhaps most importantly, the Hotel Operations Analysis will provide a professional opinion on service delivery from an employee or back of house perspective – something a standard quality assurance audit does not include.

Most Hotel Quality Assurance audits are performed using a standardized checklist and completed by hired hands often with little or no actual hotel experience. A guest centric view can be helpful, but operator results are presented in data format and usually just for public areas and guest rooms.

Using experienced hotel operations professionals in a mystery shopper role measures the entire landscape of customer service, employee performance, organizational perspectives, cleanliness, operational evaluation and post-stay engagement.

Cayuga’s Hotel Operations Analysis goes beyond a simple worksheet account of a single visit, our consultant’s focus identifies not just front-end issues and successes, it also explores back-end root causes to challenges and strategizes a plan to help owners and operators fix their breakdowns in service and facilities.

Division chair, Chuck Kelley, noted that, “A number of the calls that I receive looking for hotel operations evaluations are from owners and operators seeking help in figuring out what to do with a traditional data based report.” From there he determined that a void existed in the market, and working with several of the Cayuga Consultants created this new division that he says, “Offers an expert and thorough front- and back-of-house assessment, and also qualified recommendations that will make a difference.”

With a Cayuga Hospitality Consultant’s Hotel Quality Assurance findings report and Hotel Operations Analysis, our professionals complete their assignment with a webinar for clients to review their findings and recommendations and assist with developing next steps to promote sustainable improvement.

Cayuga’s consultants have performed in executive roles in all tiers within the hotel industry from select service to luxury full service. Every Hotel Quality Assurance and Hotel Operations Analysis assignment is tailored to meet the unique needs of each hotel and managed to work within a client’s specific budget requirements.

For more information on Hotel Quality Assurance and Hotel Operations Analysis or to present your complex challenge requiring an expert hospitality consultant or team of professionals, contact Chuck Kelley HERE or call 866.386.4020.