Impact of social media: Is your RM effort ready?
 
Impact of social media: Is your RM effort ready?
27 JULY 2010 7:58 AM

Now is the time to assess your current revenue-management situation and integrate it with online and social media marketing.

I recently attended two conferences in Orlando—HSMAI’s Revenue Management & Internet Marketing Strategy Conference and HFTP’s annual HITEC. At both events, a plethora of interesting topics was offered in the programming. But of all the subjects explored and all the new technology innovations revealed, I was struck by the extent to which social media commanded center stage. Even breakout sessions that weren’t about social media seem to veer in that direction, as if a strong, invisible magnet was pulling the conversations along. So how do we translate this seemingly boundless dialogue into sage advice? What is the consumer telling us that we need to act upon now?

In any given week, I can read any number of newspapers, magazines, trade publications and online newsletters and witness the astonishing pace of social media and its growing impact on the hospitality industry. And like many profound transformations (dare I say … sea-change?), it’s difficult to step back from our daily, warp-speed pace and figure out how and what to do about all this. It’s like trying to shoe a horse on a dead run. Nevertheless, we have no choice but to move as rapidly and judiciously as we can because the “horse” is not slowing down to wait for us.

Although I was duly impressed by the many social media success stories I heard in Orlando, I’m not seeing this engagement at the property level. Regardless of how well revenue management is being practiced at the corporate level, optimal results are achieved by how well it’s being practiced at the property level. And property-level efforts are still overwhelmingly tactical. For example, with absolutely no time to spare, we still take time to whine about online travel agencies and rate parity.

So what should we be doing to get our revenue-management effort ready for social media? Here’s my take on it:

1. Accept that this change in consumer buying behavior is monumental and create (or outsource) a position at the property level to deal with social media. Enlist helping hands from the front desk or reservations or wherever to assist in the workload. To make a comparison, revenue management as a distinct discipline in hospitality has been around roughly 15 years and some hoteliers still question the need for the role. Arguably, social media has skyrocketed in the past three years, so there’s no time to lose contemplating the need for this role.

2. Re-examine the strengths and weaknesses of your current revenue manager. Is he or she a glorified reservations manager? A tactical revenue manager? Or an Excel guru? Does he or she have a keen interest in Internet marketing or at least a genuine willingness to increase his or her knowledge base? Don’t make the mistake many made when creating revenue manager positions. Many hotels simply gave reservations managers or supervisors the RM title with little regard to the ideal traits and skills of a good revenue manager.
 
3. Assess the revenue manager’s workload. What exactly is consuming his or her time on a day-to-day basis? Is he or she creating reports that fall into the “nice to have” versus “need to have” category? Ask him or her what his or her top three time wasters are. Streamline tasks to include only essential activities. Often senior management’s addiction to “pet” reports is an obstacle to necessary change.

4. Evaluate the effectiveness and efficiency of your technology. Even in the most connected hotels, the RM effort can still be inefficient. And in less sophisticated hotel environments, the effort is often archaic. Think of it this way: if your room attendant productivity dropped by a credit, you would do something about it.
 
5. Don’t get hung up on the return on investment. Social media is about engaging the customer; it’s about authentic conversations. Definitive ROI’s may not yet be visible and quantifiable. But then again, what is the ROI on your J.D. Power scores?

6. Be willing to pay for sound advice. There are all kinds of reliable companies to help you get a handle on social media. For most of us this is new territory and revenue managers can’t be expected to know how social media impacts revenue-management decisions. But in the same breath there is no time to waste. We don’t have the luxury of months or years to examine the playing field and come up with a strategy. Whether your hotel is branded or independent, large or small, city-center or resort, now is the time to assess your current revenue-management situation and develop a strategy to transition the effort to dovetail with Internet and social media marketing. The consumer isn’t waiting, nor should you.

Bonnie Buckhiester (bonnie@buckhiester.com), a member of the International Society of Hospitality Consultants (ishc.com) and president of Buckhiester Management USA. (Washington D.C., Seattle, Vancouver)

The opinions expressed in this column do not necessarily reflect the opinions of HotelNewsNow.com or its parent company, Smith Travel Research and its affiliated companies. Columnists published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to comment or contact an editor with any questions or concerns.

No Comments

  • KlausKohlmayr July 27, 2010 4:44 AM

    Great articel Bonnie as usual. We just had a series of Webinars on Optimizing Your Hotel’s Revenue through Social Media: Dream or Reality? and it turns out 80% or more of the participants indicated increases in revenue through social media, while ROI might be still difficult to prove, many Hotel seem to understand how to effectively use these new channels to impact their top and bottom line.

  • whatnow July 27, 2010 9:38 AM

    We have been following Social Media for over a year. The statistic that is missing is what Market Segment is reaping the benefits? Our property is in the Upscale Market and we spent over $70K last year with almost no return and we do track the source of business very closely.

  • HeadStand July 27, 2010 10:56 AM

    I believe the "difficulty" a lot of hotels (and even their parent companies) are having with Social Media boils down to 2 very basic dilemnas:
    1. How do you get your arms around the new 900lb. gorilla on the block? Social media arrives at our hotels with so many different origins, rates, codes, etc - we are mostly guessing as to the empirical ROI.
    2. How do I "convert" allegiance to my own hotel/brand, thus making my initial ROI expectations more realistic...more "for the long haul".

    All of social media is about "groupings". I belong to a certain group because others in that group have a similar job, hobby, ideaology, etc. Also, the vast majority of vehicles - like Facebook and Linkedin - are about interacting OUTSIDE of "the ultimate social network"...which always has been and always will be - FACE-to-FACE!!

    As hoteliers, we have seen the evolution of "market segmentation"...all the way back from the 50's with the first Holiday Inns and HoJo's simply "picking them off" the new interstate highway ramps...to the beginning of Holidomes and "Convention Hotels" - becoming a "Destination unto Themselves". We literally "invented" and pro-actively built what is now 30% of total business in all hotels - "Group Business".

    Let's get creative and aggressive and make the same pioneer efforts as we head into the next generation - Let's literally "FACILITATE the Face-to-Face"!!

    I've recently seen a small group of hotels/resorts in the SouthWest - Heritage Hotels and Resorts - make the first move in this direction. They have teamed with a new Travel website - www.GOBirdsOfaFeather.com and are "creating Groups" from what would have been single travelers all staying at different hotels. And the coolest part of all - they didn't pull them together with what has forever been the ONLY three criteria for a hotel decision - location/price/amenities. They harnassed the inherent and HUGE power that already drives ALL social/professional networks - the need to "get together"...and simply made it convenient/easy to do at the same time these people were booking their "individual travel".

    Take a test drive at www.GOBirdOfaFeather.com/hhandr and see how to both CAPTURE and TRACK the real impact of social media.

  • Anonymous July 29, 2010 10:28 AM

    Wise words, Bonnie. You have a knack for making the complex seem painfully simple. Thanks for sharing.

  • Anonymous August 23, 2010 6:44 AM

    Great article! We already know most individual hotels do not have resources for a dedicated social media guru. And yet, when told they need to get involved with social media, the first thoughts are "I need a blog site" or "I need to tweet" or "I need a Facebook page." They forget to pay attention to the basics practice of Listening (or reading) what other people have to say. Have you ever responded to a TripAdvisor review? Statistics suggest the answer is probably No. This should be the first step for every hotel. Then expand to other sites like Expedia. Become a part of the conversations that are already taking place before trying to start your own.

Comments that include blatant advertisements or links to products or company websites will be removed to avoid instances of spam. Also, comments that include profanity, lewdness, personal attacks, solicitations or advertising, or other similarly inappropriate or offensive comments or material will be removed from the site. You are fully responsible for the content you post. The opinions expressed in comments do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Please report any violations to our editorial staff.