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EXCLUSIVE COLUMN: While Some Are In Recovery Mode, Others Are Still Waiting

Thursday, February 02, 2012
Mr. Steven J Belmonte - CHA
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Vimana Franchise Systems
Vimana Franchise Systems
Franchise-Friendly Brands

By Steve Belmonte

While the hospitality industry is supposedly in a recovery mode, many hoteliers out there are still not experiencing this recovery as strongly as they are in other markets. Instead of just enduring, hoteliers need to begin to find the tools in order to build a foundation to grow upon and need to be operating in a more prudent fashion.

Hoteliers should start taking a step back to take a better look at what their business missions and future projections are. When faced with a decrease in occupancy, average daily rate and revenue per room the most important thing to do is to make sure to outperform your competition while containing costs. The issue is that many hotels will play the rate game and you will see this happening again even though history has proven that we are all together losers when this occurs and in actuality, this does very little to generate new business. Hoteliers needs to begin to focus on literally stealing more business by using value added services and product amenities. It is at this point where hoteliers need to accept and embrace the mantra, “out of chaos grows creativity”. Here are a couple examples that hoteliers can use to maintain a status that is competitive:

Create a solid presence in the world of social media to keep yourself ahead of the marketing curve.

Having a presence on Facebook and Twitter shows the younger consumers that you are in the know about the modern technologies and communication tools. Hoteliers need to be promoting their properties and taking ownership of their local area by being known as the hotel of their city. For example, when a consumer searches your city’s name on Facebook, your hotel’s name should also show up. Remember that social media is FREE! So using it is a wonderful and inexpensive way to interact and reach out to your consumers.

Create a buzz over your property by coming up with contests that will excite consumers.

This can be easily done using social media sites like Facebook and Twitter. Not only will contests create buzz for your property but they will also help you gain a loyal following and fan-base on those sites. This is important because it helps provides your hotel with credibility and nowadays, everyone goes to the Internet to find hotels. As prizes, you can give away free night stays or if that seems like too much, even just giving out simple gift cards will do.

Make sure you research what your local competitors are presenting and one-up those promotions.

Don’t be afraid to act boldly and creatively. A great example is when Caribou Coffee showed up their competition, Starbucks, by announcing a promotion that coffee drinkers deserved a choice and offered a free decaffeinated coffee on certain days during a limited time window. The kicker? Starbucks had previously announced they were going to stop brewing decaffeinated coffee in the afternoon. Caribou won new consumers by taking advantage of the market’s affect on a direct competitor. I’m not saying that hoteliers should be offering free nights but they should absolutely be keeping their eyes open for unique attention grabbing opportunities.

It’s important to engage your guests in word-of-mouth grassroots marketing techniques via consumer rating sites such as Expedia, Trip Advisor, Travelocity, etc.

It’s clear that consumers turns to the Internet for the inside information about properties. They rely on the experiences of previous hotel-goers. Good reviews can be worth more than an expensive ad in a national magazine but bad reviews are a guaranteed business killer. Always make sure to respond to the negative reviews. Offer your apologizes and see what you can do to make it up to that guest. Most sites will allow properties to respond to a negative review so take advantage of that opportunity. Responding shows that you care and are wiling to make things right to win back their business. So every time a potential consumer sees a negative review, they will also see that you have addressed the matter and it will give them the confidence to book their next stay with you.

Fortify personalized service.

To ensure positive recommendations, your property needs to offer top-notch customer service to guests. Consider fun and interesting incentive programs for your staff. Also, make sure to reward them when they have done well. Never skimp on employee training and customer service focus. Consider them an investment. Creating a great working environment for your employees that makes them feel appreciated can make a huge difference in the standard of service that they provide to your guests.

Additionally, hoteliers need to make sure they are making the most of all the resources their franchise company has to offer. The solid franchise companies undoubtedly have the ability and wherewithal to help your property to reach it’s full potential by using regional marketing, share finding for regional advertising, IT tools, substantial discount with state travel guides, AAA and a host other programs that will guarantee your property receives it’s fair share of business. These tools are often overlooked and underutilized by property management.

Another big question that hoteliers should be asking themselves is whether or not they are in need of renovations or product upgrades. The truth is that regardless of whether we are in an economic downturn or a strong business environment, if your operating environment does not live up to guest expectations or is substandard in comparison to your competition then upgrades are absolutely going to be required. The consequence of failing to upgrade your hotel can result in a serious decline in guest satisfaction and loyalty. When there are upgrades needed you cannot make excuses. The reality is that your guests do not care and if they are dissatisfied then you can bet that they will not be back.

If you find yourself in a position where you are unable to make the necessary upgrades to your property then perhaps it’s time to consider repositioning yourself in the marketplace. There is no shame in doing this and there are in fact many great economy-based products that are available. This can help you to meet your guests’ expectations while eliminating the need to invest millions of dollars into the property. However, this is not a decision to be taken lightly as it will negatively affect your average daily rate. Remember that not all hotels need to be thinking about renovations right now. Properties that have their products in order and have remained competitive in their marketplace do not need to be considering any upgrades.

Conclusively, it’s easy to say that any decent property operator is going to watch and modify expenses wherever and whenever it is possible. All line item expenses on the P&L should be properly sent out for comparative bids which includes any long term vendors including food vendors, insurance companies, printers and uniform companies you may have had a relationship with. Good general managers will sit down and spend the time necessary to competitively shop all items. Hoteliers should especially take a look at that large check you write to your franchise company each month and consider whether or not there is an alternative franchise company with more affordable fees. It could surprise you how much money can actually be saved through this process in the marketplace today providing it is done correctly.

Regardless of the economy, we need to continue to be creative to stay afloat and drive competition. There are so many opportunities out there for us to make a difference in how consumers view our property. You may be talking about an expensive renovation or you may only be talking about utilizing some of the modern technologies that are available to everyone for FREE. I can’t stress enough how incredibly important it is to take advantage of those technologies. It only takes a little extra work and time but it will be well worth it in the end.


About Vimana Franchise Systems LLC
Vimana Franchise Systems LLC is a hotel franchise company owned by CEO Steve Belmonte, President Neal Jackson and Vice President Cory Jackson Jr. In May 2011, Vimana Franchise Systems launched the Centerstone brand as a three-segment franchise designed to create a fair and cost effective model for the hospitality industry. In November 2011, Key West Inns was re-launched under the Vimana Franchise ownership umbrella as a fun and uniquely themed leisure brand. For more information on Vimana Franchise Systems LLC, contact Steve Belmonte at (407) 654-5540 or steve@vimanafs.com. Visit Vimana Franchise Systems online at www.VimanaFS.com. Visit Centerstone online at www.centerstonehotels.com, on Twitter at @Centerstonehtls, or on Facebook at www.facebook.com/Centerstonehotels. Visit Key West Inns online at www.staykeywesthotels.com, on Twitter at @StayKeyWest, or on Facebook at http://www.facebook.com/staykeywest.




Credit
Steven Belmonte CHA    Mr. Steven J Belmonte - CHA
Chief Executive Officer / Owner
Owners, Principals, or Partners
Vimana Franchise Systems, LLC

Bio: Belmonte served a decade as President and CEO of Ramada Franchise Systems and Executive Vice President of Cendant hotel division from 1991-2001. In 2001 Belmonte founded Hospitality Solutions, LLC. Hospitality Solutions primarily negotiates the reduction of liquidated damages/termination fees for hotel owners who have been terminated or desire to cancel their existing franchise agreement. The company also negotiates fair franchise agreements for owners for all major brands. ...
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