Magnuson: How hoteliers can compete in an uncertain world
February 26, 2016
You’re 30 years old and you saw 9/11 happen when you were 15. You did all the right things, studied hard, worked hard. Now half of your life has seen headlines of market crashes, unemployment and instability.
Or maybe you are 60 years old and you remember the good days back in your 30’s. When the amazing 1990’s dot-com era exploded, the economy was so great it seemed like trees would grow to the sky.
We all know the problems facing us; now what we want to know is what to do about them. For hoteliers, competing in an uncertain world comes down to a few basics.
Identifying the perceived problems, and whether or not they truly affect you.
- Instability and the fear that comes from it can be paralyzing. What North Dakota or Alberta town could foresee the blinding speed of the oil price crash?
- Much of what we see and hear does not affect us greatly. For example, if you are running a mid priced hotel in Gary Indiana, massive illogical stock market swings will not harm you unless you have all your money in the stock market. Consider shutting off TV news once in awhile and following your own instinct instead
Reduce risk with a few ‘sure-bet’ actions we can control.
- Increase your output by 12.5% just by getting to work an hour earlier
- Make five more calls each day to sell, prospect, or say ‘thank you for your business
- Be nicer to 5 more people each day. Acknowledge the efforts of a co-worker, provide a free room to a high-repeat guest, donate a room to a local charity. Many little actions in one direction can become life-changing momentum
Planning and executing.
- Knowing your position. What’s my market and my differentiation?
- In the mid 1990’s, I ran a small highway Best Western on the Montana/Idaho border. Business took a downturn when local silver mining dried up, and got even worse when a new highway bypassed the town and the hotel. One day at the local gas station we noticed a lot of snowmobilers coming into town. With some investigation we found out that our little old mining town was surrounded by 9000 miles of old mining and logging roads. With my wife Melissa, who had an advertising company, we teamed with the town, volunteers and the United States Forest Service to brand and market Silver Country, the world’s largest trail system for snowmobiles. We went from no differentiation to becoming the hub of a new major tourist attraction. In one month, our hotel was featured on the cover of the New York Times travel section, and we gained corporate sponsorships from Coca Cola, Southwest Airlines and AT&T. Business increased 35% in the slowest time of the year.
- If your hotel is in Tupelo, Mississippi, you could brand yourself as ‘the closest hotel to Elvis Presley’s birthplace.’ Maybe you could be voted best corporate hotel in Omaha
- Is primary demand growing and why? Is travel growing in your market for a specific reason, or are you just trading market share with your competitors? If there is a new hospital, government facility, stadium, you know there will truly be an increase to your area
- What are my performance metrics? How will I know if I’m really growing? Don’t get lost in too many reports. If you are selling more rooms than last year at a higher rate, and have managed to cut your costs, you are doing great!
- What are my goals? Don’t be afraid to go big and stand out. None of us can compete with the marketing spend of the giants, but you can set your own level by leveraging uniqueness to stand tall. Just like Silver Country, or the closest hotel to Elvis’ birthplace, you can define your own micro-market and then dominate it
No sailor controls the sea, but you can raise your income in an unstable economy by making some simple changes in areas you can control. Start today and you are on your way.