Imagine this scenario. As the general manager or revenue manager of a luxury destination hotel, you are checking your occupancy and you still have significant room availability for the week ahead. What do you do –
announce a flash sale? Send a
last minute email to your database?
Here at Aró Digital Strategy, our advice to clients would be not to get into that situation in the first place. Of course, that’s easy for us to say, however we have the strategies to minimise this scenario from happening. Let’s take a look at those strategies and also investigate why flash sales and last minute emails are not only unlikely to be effective but may also be counter productive.
As I write this, it is early June and if I was the aforementioned manager, I would expect by now that my rooms for July and August are largely sold. At Aró, the planning for this is done earlier in the year in conjunction with an account manager and using a rolling content calendar for the upcoming 12 months.
It is essential to be clear about
what segments you are targeting to fill your rooms. Think about tours, weddings, MICE, FITs, corporate and then consider for each of those segments what channels they can book via e.g. direct, OTA, GDS etc. Throughout the year this is likely to change so it is important to be flexible, and be able to pivot your organic and paid content to suit.
In whatever way the year pans out, with careful planning and a relentless focus on the numbers, the aim is not to be left panicking that occupancy is low with a week to go. This can lead to bad decisions which can be counterproductive.
If you lower the rate suddenly, existing bookers will cancel and rebook at the lower rate. The OTAs will pick up on the reduction and highlight it so you are then
not only getting a lower rate but high OTA commission too. Worse, you risk diluting your brand long term if you become synonymous with sending out serial ‘last minute offer’ emails to your database.
What happens if a tour group does cancel at the last minute leaving you with multiple rooms to fill? This is where not having overused your email subscriber list repays you.
Email your guest database first to give loyal past customers first refusal (filtering out any booked guests for that month in case they cancel and rebook). Then go out to general subscribers (who may not have stayed previously) and also put it on social media if need be.
An email to guests who have booked for one night in the period of the group cancellation, offering them a special offer to
extend their stay to two nights, can also be effective.
Achieving occupancy targets is never going to be easy so all the more reason not to make it any harder. You do not have to do this in isolation. A great website, careful planning and a proactive digital agency with targeted strategies will help plot your way to smashing your goals.
Here are our top five recommended long-term strategies to avoid last-minute panic selling of rooms is crucial for maintaining profitability and brand integrity.
1. Dynamic Pricing and Revenue Management
Implement Advanced Revenue Management Systems: Use sophisticated revenue management systems (RMS) that analyse market demand, competitor pricing, and booking patterns to optimise room rates dynamically. This helps in adjusting prices well in advance to maximise occupancy and revenue without last-minute discounts.
2. Foster Loyalty
3. Focus on Direct Bookings
4. Effective Marketing and Promotions
Targeted Marketing Campaigns:
Use data analytics to understand customer segments and tailor marketing campaigns accordingly. Seasonal promotions, holiday packages, and special events can attract guests during low-demand periods, spreading bookings more evenly throughout the year. An effective strategy needs to have a strong focus on
non-paid organic content as well as paid. Our Digital Marketing team work on both on and off-page SEO for our clients which focusses on evergreen content that pays off over the long term. This is coupled with
tactical paid promotions to support each clients growth strategy.
Early Promotions: Offer incentives for early bookings, such as discounted rates or additional perks, to encourage guests to book in advance when you know there are likely to be excess rooms available. This helps in predicting occupancy levels and reduces the need for last-minute discounts.
5. Enhanced Customer Experience
Personalised Guest Experience: Use Customer Relationship Management (CRM) systems to gather data on guest preferences and provide personalised experiences. This can enhance guest satisfaction and encourage repeat visits. You can also set up email automation to keep in regular touch with targeted offers and relevant messaging to your market segments.
By implementing these strategies, hotels can better manage their inventory, optimise pricing, and reduce the need for last-minute room discounts, thereby maintaining steady revenue and a strong market position. At Aró Digital Strategy, we partner with independent hoteliers to assist them with their long term sales & marketing strategy with the ultimate aim of getting our partner clients oversubscribed, so they are always a step ahead and strategically managing their growth.