Reputation matters—even to economy hotels
 
Reputation matters—even to economy hotels
15 FEBRUARY 2013 7:17 AM

Budget hoteliers who believe there’s a direct correlation between online reputation and rates outline their best practices.

REPORT FROM THE U.S.—If Red Roof Inns CEO Andy Alexander can read all the TripAdvisor reviews generated at the brand’s 350 U.S. properties on a daily basis, he doesn’t feel it’s asking too much for the individual properties to monitor their own. In fact, he thinks it’s imperative that his general managers read and respond on a daily basis, because those reviews are critical to customers booking economy hotels.

“We encourage a hands-on approach,” said Alexander, who estimates the brand gets 15 to 20 reviews a day that he reads in a daily email from TripAdvisor. “We take it very seriously.”

Columbus, Ohio-based Red Roof isn’t alone. Wyndham Hotel Group has partnered with Revinate to provide an online reputation management tool free to all its franchisees, from economy brands such as Knights Inn, Days Inn and Super 8 all the way up to the upscale Wyndham Hotels & Resorts chain. Both companies also include TripAdvisor reviews on their booking sites.

Even independent budget properties without corporate training, prodding or tools are making it a priority to manage their online reputation.

“Our high ranking in [TripAdvisor] is one of the most important factors for our business since it is basically free marketing,” said Rosalyn Martin, co-GM of Jerry’s Motel in Los Angeles, which at press time ranked 11th of 301 hotels in the city. Rates are approximately $75, hundreds less than the 10 hotels above Jerry’s in the rankings. “These high rankings drive more interest, which leads to more reservations, and the opportunity to increase our [average daily rate] thanks to higher occupancy levels.”

Reputation matters
Alexander believes there’s a direct correlation between a hotel’s online reputation and the rates it’s able to achieve, especially at economy properties. He cited a recent report from The Cornell Center for Hospitality Research that showed there’s a .96% increase in revenue per available room for every 1% increase in reputation score.

The study did not include the economy segment, but showed revenue grew by chain scale from the top down: A 1% boost in reputation led to a .49% increase in RevPAR at luxury hotels, .74% at upper upscale, .83% at upscale, 1.13% at upper midscale and 1.42% at midscale.

“I would posit it even more important for the economy product,” Alexander said. “People want to know their basic needs are going to be met—cleanliness and good service. They don’t always know if they’ll get it at economy hotels, but at the luxury level, those basic needs are rarely not met.”

Martin, of Jerry’s Motel, said she and her husband and co-GM, Sumit Vanmali, spend a few hours a week monitoring TripAdvisor, Yelp and “scouring the Internet for any chatter about us.”

They’re doing a less sophisticated version of what technology vendors can provide, minus the overall grade and analysis of online reputation. Revinate estimated 20% of its clients are select-service hotels, while Munich-based TrustYou said 20% to 25% of its customers are economy hotels, including the Paris-based brand ibis, which has nearly 1,000 hotels worldwide.

Jerry’s Motel, with rates at approximately $75, ranks near the top of 301 hotels in Los Angeles.
 

Ignoring social media and online reputation isn’t an option anymore, said Chris Dix, VP of marketing for LivInn Hotels, a chain of four economy and extended-stay hotels in the midwestern U.S.

“I’ve been to seminars, training and heard from people, even from [big hotel companies], who say, ‘No, we don’t want to get involved in that,’” said Dix. “What they don’t understand is they’re already involved. People are talking about them and it’s not going to stop.”

Best practices
Wyndham Hotel Group has embraced online reputation management strategies, not only spending significant money to provide a tool at no cost to its franchisees, but also encouraging even more online reviews through a partnership with TripAdvisor. The company has more than 7,300 hotels in its global portfolio.

Last spring, Wyndham began displaying TripAdvisor ratings and reviews across all 17 of the company’s brand.com booking sites. In April at its global conference, Wyndham unveiled WynReview, a comprehensive online reputation management to help franchisees monitor, measure and manage ratings and reviews from numerous sites.

“We want to do anything we can for the small operator to save them time,” said Diane Barr, Wyndham Hotel Group’s VP of customer experience and brand standards. “This takes the burden off the owner/operator of a Super 8 or Days Inn, who may also be acting as director of operations and engineering, and gives them a one-stop shop with an alert functionality.”

Later in the year, Wyndham partnered with TripAdvisor to replace its more traditional guest-satisfaction survey provider. Now, guests receive a post-stay email asking for ratings on a one-through-five scale across the basic TripAdvisor categories and for comment in a free-form text box. Each brand can also include up to 20 additional questions. Properties receive all the feedback, and guests can opt to have their responses published on TripAdvisor.

As a result, Barr said Wyndham is getting three times more reviews than previously received, and the training and WynReview tool have led to higher ratings across all brands. Barr said franchisees are coached to read and respond to reviews on a daily basis, assess the overall online reputation scorecard from WynReview on a weekly basis and react by improving any problem areas. Wyndham provides guidelines on effective responses to good and bad reviews, which should come within 48 hours of the posting.

Like Wyndham, Red Roof also includes TripAdvisor ratings on its booking site, but it does not utilize a software provider for help. Instead, Red Roof directs its corporate and franchised GMs on how to handle social media, and specifically TripAdvisor. A GM or assistant GM must reply to all reviews within 48 hours, and to negative ones within 24 hours, Alexander said.

“We require a name and title with the response, so when a customer visits the property or calls, it’s a real person they can identify with leading the property,” he added.

At Jerry’s Motel, Martin and her husband, whose family has owned the hotel for 40 years, take a similar approach. They embed free widgets from TripAdvisor on their website so recent reviews are posted there. They also aim to respond to every review, good and bad, and ask customers to post positive feedback if they’re happy with their stay.

“[TripAdvisor] and other review sites are great if owners and managers are serious about running a successful business,” Martin said. “It really helps bring other places like us that might go unnoticed to the forefront and gives us an opportunity to compete against other businesses that might have more name recognition, a larger staff and larger marketing budget.”

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