By Larry Mogelonsky, MBA, P. Eng. (www.lma.ca)
Last year, I wrote a sensationalist article playing off the common religious story of the Four Horsemen of the Apocalypse. Giving each a hotel inference, the four became:
- PLAGUE (red horse) – The OTAs
- WAR (white horse) – Airbnb
- FAMINE (black horse) – Too Many Brands
- DEATH (pale horse) – Lack of Entrepreneurship
While there was some disagreement over what the four hospitality horsemen actually were, one truly insightful complaint was that I only identified and explained the issues without offering any clear and present solutions. Thus, this sequel article is what’s needed with a salient and actionable step to mitigate each potential problem.
1. The OTAs. While they can dilute your brand and drive customers away from booking direct, the OTAs do have a few pronounced advantages. Particularly for independent or small-chain properties, they allow hotels to gain exposure in territories and languages beyond the capacities of a typical marketing budget. My solution is to embrace the fact that the OTAs exist, and then find out how to best lever them for added revenues. Know their limits and understand their disadvantages. If you need help, the leading OTAs all have knowledgeable reps who can clue you in to missed opportunities. And note, there are changes afoot insofar as contractual agreement restrictions that often frustrate hoteliers. Net, evolution is underway here.
2. Airbnb. Yes, it’s a big threat to every property from big corporate monoliths to boutique B&Bs, but there’s still hope! If you aren’t already, petition your local and regional tourism agencies to appeal for proper (ie: equal) taxation enforcement and regulatory measures – even if we can’t make it go away, at least Airbnb can play fair. In other words, level the playing field! Next, ask yourself why this new hospitality giant has grown so quickly. You could argue for the flexibility of the sharing economy or the inherent demand for interesting lodgings, but at its core Airbnb grew because a sizeable number of hotel guests didn’t feel as though they were getting their money’s worth out of their guestrooms. Knowing that this is the fundamental issue, you can remedy it by promoting your hotel features that no freelanced Airbnb accommodation can ever match. It’s your amenities, your F&B, your property security team, your concierge service and every other brand standard guarantee that will sell your hotel to this new breed of traveler.
3. Too Many Brands. This is the trickiest one to solve as effective rebranding takes years to accomplish and you have to weigh the owners’ needs against those of the brand as well as the management company. Any sort of brand consolidation or new venture must be taken with the utmost prudence. The world is changing rapidly and so too are its consumers. New niches are presenting themselves every year and only the most observant and nimble brands will be able to design product that successfully targets these segments. Keep your ear to the street to stay in touch with the latest trends, and when the time is right for a change you’ll have the wherewithal to know which direction is best.
4. Lack of Entrepreneurship. While rebranding is a company-wide affair, developing your intrapreneurship is something that any manager can shepherd. Start by finding those employees who value hospitality as a career and not just as a job. Next, empower these individuals by giving them the space and freedom to operate projects autonomously. If you promote those team members who have a passion for the industry, they will not only take some of the food off your plate to make your job easier, but they will also identify areas in need of improvement and act to fix them before they become recurring issues.
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