When The Big Guys Go After the Small Fries.
By Madigan Pratt
Friday, 15th October 2010
There was a time, not so long ago, when large hotels focused marketing and sales efforts on meetings and conventions and the business traveler. Not any more – and this is not good news for small luxury hotels.

As a result of the recession and changes in the corporate travel environment, larger hotels have started to rethink their customer mix. They have begun to place greater emphasis on the leisure traveler, once the primary domain of small hotels. This move was highlighted in a recent meeting of the Meridian Club according to World Travel Market.

The reasons for this shift in focus toward leisure travelers is based on economics.
  • Corporate travel budgets have been cut – drastically
  • No relief anytime soon – T&E budgets are always slow to recover following a recession
  • Corporate mandates – oftentimes preclude staying in a five-star hotel
  • Corporate procurement offices are tough negotiators demanding many concessions from hotels
One hotelier in the meeting concluded -

It is possible that leisure travelers might now be more profitable than corporate guests.

Not good news for small hotels who can expect increased competition from the Big Guys.  So when the Big Guys go after the Small Fries what should you do? Here are six areas you should be integrating into your marketing planning now:

1. Product – make sure you are providing good value for the money. That's what every guest is looking for today.
  • A good way to check your value proposition is by monitoring TripAdvisor.
  • If you have a problem – fix it! There is no place to hide your shortcomings anymore.
2. Marketing – see that your website, internet strategies and SEO are the best they can be.
  • Money invested in creating a dominant web presence is well spent. It's where travelers shop.
  • The Big Guys know this and are investing heavily.
  • Join the social media conversation if you haven't already. Make it better if you have.
3. Loyalty - loyal guests are the most profitable . Communicate with past guests and build loyalty.
  • Use direct marketing best practices to communicate regularly offering relationship-building messages. Create a dialog – that's what relationships are all about.
  • Don't just repeatedly "e-blast" guests with Specials. That's equivalent to SPAM.
  • Let them know what's going on at your hotel and your destination. Give them something to look forward to and a reason to return.
  • Make your gold standard that they recommend you to a friend.
4. Distribution – check with your wholesaler and Online Travel Agencies and make sure your product is fully inventoried and attractively priced and packaged.

5. Public Relations – one of the most effective ways to increase awareness of your hotel.
  • Remember travel writers are concerned about their readers and giving them something new, exciting, different, unique.
  • Make your press releases interesting and exciting.
6. Measurement -  measure the effectiveness of every marketing effort.
  • This will allow you to spend your budget on initiatives that produce the greatest return on investment (ROI).
  • Continue to refine your marketing to maximize effectiveness.
Although the recession was reported to have ended in June 2009, I don't know of very many hotel marketing professionals who have broken out the Champagne. We are in a weak recovery and there are still many challenges ahead for small luxury hotels.

Don't let the Big Guys move into your leisure traveler territory without putting up a fight.  Keep up the marketing. And make sure it works for you.

Madigan Pratt is Managing Director of Madigan Pratt & Associates, Inc., an innovative CRM company dedicated to acquiring and retaining profitable customers for luxury hotels. Prior to founding MP&A in New York two decades ago he held senior management positions overseeing marketing communications for several Fortune 500 companies.

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