Measuring and generating demand is always a question that prospective clients ask as it’s certainly a challenge many hoteliers face. In order to be successful, hotels must set up an efficient, effective and long-term demand generation strategy. In this blog series, we will take you through those steps from the most obvious to the less obvious.
The first step in understanding demand generation is to fully understand your product, customer(s) and value proposition. Take for example a 4-Star Hotel located in city center that has a good mix of both business and leisure travellers. Think about the target customers or target market segments and how you can create a unique value proposition to appeal to both.
For the typical business travellers, following are a few examples of value propositions that they’re looking for:
- Free & Fast Wifi
- Working Desk in the Room
- Laptop Safe in the room
- Business Center
- Healthy Breakfast Options
- Onsite gym
- Iron & Ironing Board in the room
- Laundry Service
On the other hand, a typical leisure guest may tend to look for the values such as:
- Location to local attractions and transportation
- Room size and comfort
- Positive online review scores
- Onsite facilities like swimming pool, spa and restaurant
Most leisure travellers are more price sensitive. Once you have nailed down your target product, customer(s) and value proposition the second step to creating an efficient, effective and long-term demand generation strategy is pricing.
An important part of correct pricing is tracking what your competitors and the market are doing. In order to correctly do this, you must invest in a reliable rate shopping tool that can help you to track your competitors pricing on a daily basis as well as provide an overview of the different rates & room types they are offering, when and how often they are changing rates, when they are sold out (market compression) as well as many other useful data analytics features and tools.
Once you have some intelligence on what the market is doing in terms of pricing then it’s time to create different pricing options that would appeal to the different types of customers you have identified as your target clients. The typical business guest may be willing to pay a bit more given they have more flexibility in the cancellations, whereas the typical leisure traveller may be looking for that deal so, paying less in advance with a no cancellation policy could be an attractive offer.
Try and create multiple price points and offers with the correct restrictions to appeal to a large variety of customers. Make sure you are clear with your price offering and on any given stay date, try not to have too many offers that could confuse but enough to attract different types of guests.
Lastly, be sure to review your offers and pricing strategies on a seasonal basis and make changes as necessary to market demands.