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Property Level Impacts - Sales, Marketing & Revenue Management

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Presentation at HSMAI Greater China Asia Connect 2011. Results from a study done of hotel sales, marketing and revenue managers in Greater China

Presentation at HSMAI Greater China Asia Connect 2011. Results from a study done of hotel sales, marketing and revenue managers in Greater China

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  • 1. Current Impacts on Sales, Marketing and RevenueManagement in Greater China Hong Kong Polytechnic UniversitySchool of Hotel and Tourism Management & HSMAI Greater China Chapter 1
  • 2. Whatever It Was That Got YouWhere You Are Today Is NOT Sufficient To Keep You There
  • 3. Presentation• Question asked• Background for study – Thought Leaders Study 2009 – Development of questions• Survey method & participants• Top 5 impacts by discipline – Comparison to Thought Leaders Study• What didn’t make it• Putting you to work – How should we address the impacts• Summary
  • 4. Question Asked“Now that more than 2 years havepassed since the onset of the globalfinancial crisis, what do you feel arethe key impacts it has had on (sales,marketing or revenue management)in the hospitality industry within theGreater China region?”
  • 5. Thought Leaders Survey 2009• Impacts of economic downturn – Sales & Sales Management, Marketing and Revenue Management – Generate Top 5 Impacts in each discipline• Delphi Method – Multiple Rounds (3)• Panelist - 37• Roundtable discussion
  • 6. Property/Corporate Impacts• Development of questions – Top 5 impacts by discipline from Thought Leaders – Industry publication trends• Discipline Specific Impacts – Sales and Sales Management (13 items) – Marketing (25 items) – Revenue Management (27 items)
  • 7. Survey Method• HSMAI Members distributed through senior level sales, marketing and revenue management executives to the property level – Global chains – Mainland China domestic hotel groups – Independents• Online survey
  • 8. Total Participants – 140• Location – Mainland (85%) • Type of hotel – HK (13%) – Global chain (71%) – Taiwan (2%) – Mainland domestic (25%) – Independent (4%)• Function area – Sales (43%) • Experience – Marketing (38%) – Less than 2 years (11%) – RM (13%) – 2-5 years (19%) – Others (6%) – 6-10 years (17%) – 11-15 years (17%)• Organization Level – More than 15 years (34%) – Corporate office (13%) – Regional office (10%) • Position – Property level (77%) – GM (2%) – DOS or DOM (28%) – DRM (2%) – Sales Manager ( 19%) – RM ( 10%) – Marketing Manager (11%) – Other (27%)
  • 9. Results of Top 5 Impacts
  • 10. Sales and Sales ManagementThought Leaders Impact Property/Corporate Level Impact1. Hire for attitude and train for 1. Keeping the sales team motivated skills 2. Sales team has to be more focused2. Understand that relationship/lead on closing the deal and should be selling is often more successful fast in hunting for new than cold calling business/prospects3. Sales team has to be more 3. Training to help sales team focused on closing the deal and members negotiate with confidence should be fast in hunting for new business/prospects 4. Update of market information,4. Keeping the sales team motivated tactics, and strategies for all markets as the focus and to follow5. Helping the sales team to focus on up on meeting every customer’s closing business needs 5. Understand that relationship/lead selling is often more successful than cold calling
  • 11. Analysis of Results• Motivation is #1• Information and training emphasis• Didn’t indicate need for support in closing
  • 12. Question to Contemplate• Does motivation mean the same thing to Thought Leaders as it does to property level manager?• What do you train? Closing? Negotiation?
  • 13. Thought Leaders Roundtable Action Feedback• Training leadership of sales is key• Know individuals and motivate to their goals• Relationship selling closes the deal• Need sales training to close the gaps in skills
  • 14. MarketingThought Leaders Impact Property/Corporate Level Impact1. Clearly knowing the target 1. Customer retention is most critical; market[s] is essential and to do not compromise on standard and tailor the product/campaign to services just because guests are that paying promotional or TA rate2. Greater use of CRM to enhance 2. Clearly knowing the target market[s] loyalty and customer retention is essential and to tailor the product/campaign to that3. Competitive pricing strategy 3. Creating a strong and unique marketing message4. Customer retention is most 4. Competition and cooperation will critical; do not compromise on become fierce and imperative among standard and services just destinations within Greater China because guests are paying promotional or TA rate 5. Hotel marketing will be more focused on chasing Mainland Chinese5. Creating a strong and unique customers, because Mainland China marketing message has generated tremendous volumes of domestic, inbound and outbound tourism activities
  • 15. Analysis of Results• More emphasis on the Mainland China and the resulting competitiveness• Knowing market and having strong, unique message in common for both
  • 16. Question to ContemplateDoes tailoring market to Mainlandand the resulting competitivenessmean a need for a pricing strategy?
  • 17. Thought Leaders Roundtable Action Feedback• Customer retention key to convince owners of need to provide same levels of service• Marketing initiatives depend on GM support• Look at expectations versus perceptions of guest not just satisfaction• Need tools to know customers in each channel
  • 18. Revenue ManagementThought Leaders Impact Property/Corporate Level Impact1. Though the focus has shifted to 1. Future revenue managers will “closing the deal now” or “taking it principally need analytical skills. A first then yield later”, revenue formal RM education and negotiation management can contribute greatly skills would also be useful to a hotel’s positioning through pricing 2. RevPAR continues to be the most2. Forecasting becomes critical to relevant way of measuring RM effectively staff and manage costs in efficacy a downturn3. Revenue Management is very 3. OTA’s cannot be ignored, but need important when it comes to selecting to be managed just like any other the right piece of business that will source of business contribute positively to the hotel bottom line 4. Dynamic pricing would be the most4. Focus on total revenue management effective way of increasing RevPAR across all revenue streams as owners and management concentrate on 5. Technology will play a strong role bottom line in future developments within RM5. Effective distribution in emerging market (e.g., China , India)
  • 19. Analysis of Results• Everything is different• Skills and technology needed• Distribution and dynamic pricing are keys• RevPAR is the measurement• Thought leaders more focused on recognition of RM and forecasting
  • 20. Question to Contemplate• What skills & technology does revenue management have to work with? Forecasting?• Is RevPAR the benchmark for making distribution and dynamic pricing decisions?• Is property thinking too narrow
  • 21. Overall Differences by Category• By Function – Marketing more important than Sales • Sales team has to be more focused on closing the deal and should be fast in hunting for new business/prospects* – Revenue Management more important than either Sales or Marketing • Dynamic pricing would be the most effective way of increasing RevPAR • Forecasting becomes critical to effectively staff and manage costs in a downturn* • The revenue management function will become more central to hotel operations, and will quite likely be a separate department that is under the general manager’s supervision** • Hiring and training a qualified RM will be the prime challenge facing revenue management **• By Level of Responsibility – Regional office more important than property on sales impacts • Keeping the sales team motivated • Training to help sales team members negotiate with confidence • Helping the sales team to focus on closing business* – No difference between corporate and either level *Thought Leaders Top 5 **Neither Top 5
  • 22. Thought Leaders Roundtable Action Feedback• Understand enterprise value/lifetime value of customer with new technologies• VP of revenue generation?
  • 23. What Didn’t Make the List• Sales – Stop giving away room upgrades – Serious price war amongst competitors• Marketing – Business travel will recover from the recent recession but business class/executive floors may face changes – Richer, older and going somewhere - demographic changes will alter Western and Asian travel• Revenue Management – Hotels will be working with fewer third party intermediaries – The out-sourcing of hotel revenue management will increase
  • 24. Summary• Rightness is the Theme – Right approach to selling/training – Right information – Right customer - Mainland – Right price – Right message – Right tools and technology• Treat RM with respect• Right person in regional office?
  • 25. What Do You Think?• How do we address these impacts?• What actions to address issues in each discipline?
  • 26. Thank You Xie Xie 谢谢!