There are many challenges in the hospitality industry in Australia – fluctuating demand, technology integration, customer experience management – but perhaps the most challenging for many is attracting and retaining top talent. The aftermath of the COVID-19 pandemic has only intensified this challenge, necessitating a nuanced strategy to bridge the talent gap.

Here, we outline a multifaceted approach required to not only allure but also retain professionals crucial for the sustained success of the industry. In a field as diverse and ever-evolving as hospitality, securing and nurturing skilled individuals is not just a necessity; it’s the cornerstone of lasting prosperity.

Importance of Talent Retention in the Hospitality Industry

Though the doors have thankfully closed on the infamous 2020 lockdown era, the hospitality industry still faces difficulties in its wake.

Experienced hospitality workers shift careers, and international students, a key workforce, hesitate to return to Australia. This dual departure has created a substantial talent gap, posing a threat to the industry’s long-term viability.

Beyond numerical concerns, talent acquisition and retention are crucial for maintaining service standards and operational efficiency. The departure of seasoned professionals leaves an experiential void, while the absence of international students exacerbates the shortage of diverse and adaptable skill sets.

To navigate these challenges, a robust talent retention strategy is essential, not only to address immediate staffing shortfalls but also to fortify the industry against future uncertainties, ensuring sustained success and resilience.

Strategies for Attracting and Retaining Top Talent

Develop a Strong Employer Brand

Creating a positive reputation for your business and emphasising what sets you apart from competitors is crucial in attracting and retaining talent.

Consider factors like company culture, employee benefits, training and development opportunities, and work-life balance. By doing so, you can create a unique identity that resonates with potential employees and sets you apart from other businesses in the industry.

Offer Competitive Compensation and Benefits

Offering competitive pay and benefits packages can help to ensure that your business is attractive to candidates. It is essential to stay up to date with industry standards and to regularly review and adjust your compensation and benefits packages.

This can help to ensure that your business remains competitive and that you can attract and retain top talent.

Provide Opportunities for Growth and Development

Providing opportunities for employees to learn new skills and advance in their careers can help to increase job satisfaction and reduce turnover rates. Think about training programs, mentoring opportunities, and career development paths.

These initiatives help to create a culture of learning and development that encourages employees to stay with your business long-term.

Foster a Positive Work Environment

Fostering a positive work environment is essential for talent retention. Provide a safe and comfortable work environment, promote teamwork and collaboration, and recognise and reward employees for their hard work and contributions.

By doing so, you can create a workplace culture that is supportive, engaging, and fulfilling. This requires a clearly defined business vision and strategy that creates alignment with key stakeholders; employees being one such stakeholder.

Embrace Diversity and Inclusion

It’s essential to show that you value and respect individuals from all backgrounds and create a workplace that is welcoming to all.

Encouraging diversity and inclusion, especially within the hospitality industry in Australia, can help to create a more innovative and creative workforce that is better equipped to meet the needs of a diverse customer base.

Utilise Technology

Technology can be particularly helpful in talent acquisition. Consider using online job boards and social media platforms to advertise job openings and reach a wider audience.

Additionally, using technology to streamline recruitment and hiring processes can help to improve efficiency and reduce time-to-hire.

Assist With Cost of Living

Many hotels and resorts in regional areas face the added challenges of higher costs of living and lack of rental accommodation. This can make it difficult to attract and retain talent, especially in areas that are heavily reliant on transient workers, backpackers, and working holiday visa workers.

To address this challenge, consider offering housing assistance or partnering with local real estate agents to provide affordable rental options for employees.

Offer Flexible Work Schedules

Finally, flexible work arrangements are now just as important to employees as company benefits. Can you offer flexible start and finish times, a nine-day fortnight, or even a four-day work week?

There are plenty of good options being used more and more by competitor companies in the hospitality industry in Australia, so we recommend thinking about what you can offer.

Talent Retention in Regional Areas

In regional areas or untapped suburban markets, it’s common practice to employ hospitality workers from the working holiday visa pool.

These employees will always be with you for a short time, so you need to ensure you have strategies in place to get them productive as quickly as possible and ensure there is little impact when they exit.

Here are some strategies that can help you get the most out of your working holiday visa employees:

• Provide clear job descriptions to ensure that your working holiday visa employees understand their roles and responsibilities. This can help to reduce confusion and ensure that they are productive from day one.
• Offer training and development opportunities to increase the skills, knowledge, and productivity of your working holiday visa employees while reducing the impact when they exit.

Provide feedback and recognition to motivate your international employees and increase their job satisfaction, which in turn can reduce turnover rates.

• Create a supportive work environment to ensure staff feel valued and respected. This can include providing a safe and comfortable work environment, promoting teamwork and collaboration, and rewarding employees for their hard work and contributions.
• Partner with local organisations like universities to offer internships and apprenticeships, local real estate agents to provide affordable rental options, or local businesses to offer discounts and other incentives.

Gain Strategic Success With Axsia

As the hospitality landscape undergoes dynamic growth, Axsia stands ready to collaborate with you in navigating the evolving challenges of talent acquisition and retention.

Our expertise in crafting tailored strategic plans aligns with the unique demands of the hospitality industry in Australia.

By partnering with Axsia, you unlock the potential for not just attracting and retaining top talent but also fostering a collaborative and cohesive industry environment. From cross-functional teams to facilitating communication between corporate offices and local teams, we offer comprehensive solutions.

Speak with our team today to shape a sustainable and thriving future for your business in the ever-changing hospitality landscape.

Embarking on the journey of hotel renovations is more than just a facelift—it’s a strategic investment that can elevate guest satisfaction and drive substantial return on investment (ROI).

In this blog, we explore the transformative power of strategic hotel renovations, delving into how thoughtful upgrades can not only enhance the overall guest experience but also serve as a catalyst for maximising profitability.

Join us as we unravel the key considerations and effective strategies for ensuring that your hotel renovation meets aesthetic expectations while aligning seamlessly with your business goals.

The Importance of a Robust Business Plan

A business plan is not merely a document; it’s the bedrock upon which any renovation project is built. It meticulously delineates the owner’s vision, objectives, and strategies for the renovation, serving as a roadmap that guides every decision and action.

A well-crafted business plan is a powerful tool that can unearth opportunities to explore new, underserved markets and establish a competitive edge against key rivals. It can illuminate paths to growth and diversification that may otherwise remain hidden.

Hotel business plan example

A hotel strategically situated near a convention centre could contemplate refurbishing its conference rooms. This move would cater to business travellers and event organisers while effectively enhancing its appeal as a premier meeting venue.

Moreover, the same hotel might weigh the benefits of incorporating leisure facilities, such as a swimming pool or spa. These additions could serve dual purposes: they could be used for events, thereby expanding the hotel’s service offerings, and they could attract a new demographic – the leisure market.

Short Term vs Long Term Hotel Business Plans

Hotel operators typically formulate annual business plans. These short-term action blueprints detail the specific tasks, milestones, and steps that your business intends to undertake over the forthcoming twelve months or so, driving your business forward with precision and purpose.

Conversely, long-term strategic plans cast an eye on the distant horizon, outlining your broad strategies for growth. They provide a panoramic view of how the business will reach its objectives, typically spanning a 3–5-year timeline, and occasionally even longer.

Longer-term plans can be bigger, bolder, and more fruitful for your hotel business. You can develop a clear, deep strategic vision, optimise capital expenditure through an asset manager, and unlock real potential with investment growth.

Market Analysis: Components of an Effective Plan

A comprehensive business plan should also analyse key options and scenarios, as well as the current market. This analysis is crucial as it informs decisions, guides the renovation process, and helps ensure that the renovated property meets the needs and preferences of its target customers.

Consider the Owner’s Investment Strategy

Before any market analyses or renovation plans happen, we need to consider the owner’s investment strategy to create an effective business plan. This includes the required ROI and investment horizon.

An owner with a short-term investment horizon might focus on quick, cosmetic upgrades that can boost the property’s appeal and value, while an owner with a long-term investment horizon might invest in extensive renovations that can drive sustained growth over time.

Identify Target Customers

Now it’s time to identify the key target customers. These are the individuals who are most likely to stay at the hotel after the renovation. For instance, if a hotel is located near a convention centre, the key target customers might be business travellers and event organisers.

Understanding who your customers are, their needs, preferences, and behaviours, is crucial for making informed decisions about renovations. This information can be gathered through market research, customer surveys, and data analysis.

Assess the Current Market Position

The next step is to assess whether the hotel currently serves its target market effectively. This involves analysing customer feedback, occupancy rates, and other relevant data. Identify any gaps in customer experience satisfaction and address them in the renovation plan.

For example, if the target market is business travellers, does the hotel offer high-speed internet, comfortable workspaces, and convenient business services? On a larger scale, if the target customers are couples and empty-nesters, a spa or wellness centre could be considered.

Explore New Market Opportunities

In addition to serving the current market, it’s important to explore new market opportunities. These could be under-serviced markets that the hotel can tap into with a new or revitalised product.

For example, if there is a growing demand for eco-friendly accommodations in the area, the hotel might consider incorporating green technologies and practices in the renovation. This could involve identifying underserved markets, emerging trends, or changes in customer behaviour.

Evaluate Hotel Class

It’s beneficial to evaluate whether the hotel is in the right class or if it could be better after the renovation. This involves comparing the hotel with its competitors and assessing its unique selling points.

If the hotel has the potential to offer a superior product or service, the owner might consider elevating it into a higher-yielding class through renovation.

Conduct a Thorough Financial Analysis

Finally, and perhaps most importantly, is the financial analysis. This critical component of a hotel business plan provides a quantitative evaluation of the potential return on investment from different renovation scenarios. This could include:

• The ‘do nothing’ scenario: What happens to RevPAR and overall profitability if no renovations are made? This provides a baseline for comparison with other scenarios.
• Minimal capex scenario: What is the potential return if only minimal capital expenditures are made to maintain the asset for RevPAR growth?
• Significant capex scenario: What is the potential return if significant capital is invested to achieve structural re-positioning against the current competitive set or an elevated competitive set?

By conducting a thorough financial analysis, owners can make informed decisions about the scale and scope of the renovations, ensuring they align with their overall investment strategy and business objectives.

Designers: Creating a Strategic Vision Alignment

A pivotal element in any hotel business plan for renovations must be to create and maintain clear strategic vision alignment between the owner and the designer. You want to aim for a collaborative approach to development for optimal success.

Designers bring invaluable expertise in aesthetics, functionality, and the latest trends, shaping the look and feel of the renovated property. Their input can transform a space, making it more appealing to guests and potentially driving revenue per available room (RevPAR) growth.

While designers of course bring valuable insights and ideas, hotel owners must maintain a clear focus on their strategic objectives throughout the renovation process. Design decisions should not be made in isolation but should align with the broader business strategy and vision.

For instance, designers might suggest improvements that could enhance the current product offering and achieve linear RevPAR growth. This could include updating room decor to reflect the latest trends, improving the layout of public spaces to enhance guest flow, or upgrading amenities to meet current guest expectations.

While these improvements can boost the hotel’s appeal and performance, they represent an evolution of the existing offering rather than a significant shift. This is what is meant by ‘linear RevPAR growth’ – it’s about making better what is already there.

By balancing the expertise of designers with a clear understanding of their strategic objectives and market opportunities, owners can make informed decisions that maximise the return on their renovation investment.

The Power of Branding and the Art of Rebranding

Renovations aren’t only about brick-and-mortar revamps. When we discuss hotel renovation strategies, and particularly when we give hotel business plan examples, one element that sometimes comes as a surprise is branding.

Branding (or rebranding, as we’ll get to soon) is another kind of renovation that can significantly affect guest experience and ROI. In the competitive landscape of the hotel industry, branding is not just a tool, but a potent weapon. A robust brand doesn’t merely draw in loyal customers; it also allows for commanding premium room rates.

How Can a Rebrand Improve a Hotel?

During a renovation, you should determine whether the existing branding resonates with the property’s target market and positioning. In certain scenarios, a rebrand might be the key to unlocking new customer segments and driving superior returns.

This could necessitate a comprehensive revamp of the hotel’s visual identity, encompassing elements like its logo, colour scheme, and interior decor. It could also mean redefining the hotel’s mission, values, and unique selling propositions.

While not easy to do, a successful hotel rebrand can infuse a fresh lease of life into a business, enhancing its appeal to its target customers and distinguishing it from its competitors. If you’re considering rebranding, whether it’s a subtle refresh or a radical overhaul, we recommend seeking the services and guidance of a marketing agency that specialises in the hospitality industry.

Unlock the Power of Strategic Planning With Axsia HTL

A well-crafted business plan is incredibly effective at honing the owner’s focus and narrowing down the brief for the designer, project manager, and potential lenders.

By adopting a strategic approach to planning and executing hotel renovations, owners can maximise their return on investment and pave the way for the long-term success of their property.

If you’re interested in elevating your hotel business plan and striking gold on your ROI with targeted renovations, reach out to us at Axsia. Our expert team can create a comprehensive business plan that ticks all the boxes and exceeds your expectations in a range of diverse areas.

Interested to see more? Check out our portfolio of major project developments to get a feel for how Axsia HTL can elevate your hotel business.

Navigating the dynamic terrain of the hotel industry requires a keen understanding of the pivotal areas that hold the key to success for your investment. In this ever-changing landscape, where competition is fierce and guest expectations are constantly evolving, orchestrating effective strategies becomes more critical than ever. Success is not merely a product of chance but rather the result of meticulous planning, foresight, and unwavering dedication.

For hotel owners and operators, the journey toward prosperity necessitates a collaborative approach, where the collective efforts of key stakeholders, including owners, asset managers, and brand operators, converge harmoniously. Together, they forge a path that defines objectives, nurtures potential, and steers the team towards the realisation of their shared vision.

In this article, we delve deep into the core aspects of how to run a hotel business successfully. We explore the pivotal success factors and strategies that have the potential to transform your hospitality venture into a thriving and enduring establishment. Join us as we unravel the roadmap to prosperity and discover how the amalgamation of these essential elements can lead your hotel business to new heights.

Effective Human Resource Planning

The hotel management landscape has seen significant expansion in recent years, with a surge in development and signings, yet without a proportional increase in corporate office resources. This growth imposes additional pressure on Hotel Executive Teams to devise and implement a unique strategy for their individual hotel.

Due to the rapid expansion of hotel companies, expertise and experience within hotels have become scarce commodities. It’s imperative for hotel owners and companies to invest in effective human resources to ensure the longevity and success of their business. Hotel operators should:

• Invest in on-site leadership: This includes making strategic appointments of a General Manager and Executive Committee Team with an emphasis on commercial expertise to drive performance.
• Offer mentoring and support: First-time General Managers and Executive Team members can benefit through “buddying up” with a senior colleague or with regular mentoring programs.

Asset Managers also play a crucial role in mentoring. For instance, Axsia HTL actively mentors General Managers and Executive Committees, which we consider key to the success of a hotel team’s performance.

In the face of global competition for talent across all industries, effective human resource recruitment and retention strategies have become more critical than ever for companies.

Financial Planning for Profitability

As the annual budgeting cycle commences, hotels and hotel operating companies are tasked with preparing a business plan for the upcoming 12 months. While this is a requirement of Hotel Operators, it’s often seen that hotels merely go through the motions of preparing a budget or business plan.

These plans, by nature, focus on the short term (12 months) and are designed to meet the operator’s targets and appease the owner. However, owners typically have longer-term objectives for their assets. It’s incumbent upon Hotel Operators to develop a strategic plan that extends beyond the 12 months.

This plan should aim to grow EBITDA and increase the asset’s value over the long term, which may involve investing more in the short term for long-term financial returns. For instance, a new or renovated hotel might increase its investment in sales and marketing as it stabilises.

How Much Does It Cost To Run A Hotel?

When it comes to the intricate web of expenses in running a hotel, the numbers can be quite staggering. Beyond the initial investment, a hotel’s daily operations entail various costs that significantly impact its profitability and long-term viability. These expenses encompass a wide spectrum, ranging from employee salaries and utility bills to maintenance and marketing expenditures.

Salaries often constitute one of the most substantial portions of a hotel’s operational costs. From front-of-house staff like concierges and housekeeping personnel to back-of-house teams such as kitchen staff and administrative employees, the workforce is a cornerstone of any hotel’s service delivery. Employee compensation is not limited to basic wages; it extends to benefits, training, and, in some cases, incentive programs.

Utilities, including electricity, water, heating, and cooling, are another major cost category. Hotels consume significant quantities of these resources to maintain guest comfort, often leading to substantial utility bills. Moreover, hotels must adhere to sustainability practices to minimise their environmental footprint, necessitating investments in energy-efficient systems and practices.

Maintenance is yet another significant cost consideration. Ensuring the upkeep and aesthetics of a hotel property is paramount, from interior furnishings to exterior landscaping. Repairs, renovations, and preventive maintenance measures are essential to safeguard the property’s value and guest experience.

Marketing is a cost that no hotelier can afford to overlook. To attract guests, boost occupancy rates, and enhance their brand’s reputation, hotels need to invest in various marketing channels. These may include digital marketing efforts, advertising campaigns, and public relations strategies, among others.

Sustainable Resource Management

The hotel industry accounts for 1% of global carbon emissions, and research predicts that hotels must reduce carbon initiatives by 90% by 2050 to have any impact on their carbon footprint. Embracing sustainability can also result in financial benefits for hotels, and these days, it forms the basis of how to run a hotel effectively.

Sustainability initiatives in the hotel industry encompass a broad spectrum of practices aimed at reducing environmental impact. These include a concerted effort to minimise energy consumption through measures like the use of energy-efficient lighting, heating, ventilation, and air conditioning systems. Additionally, hotels can invest in renewable energy sources, such as solar panels, to further diminish their reliance on fossil fuels.

Addressing food and plastic waste is another crucial aspect of sustainability. Hotels can implement waste-reduction strategies, such as optimising food portion sizes, donating excess food to local charities, and incorporating composting practices. Reducing single-use plastics in guest amenities and replacing them with eco-friendly alternatives not only curbs plastic pollution but also elevates a hotel’s sustainable image.

Water conservation is paramount, given that the hotel industry consumes vast amounts of water in its daily operations. Implementing low-flow fixtures, regular maintenance checks to repair leaks, and utilising greywater systems for non-potable uses all contribute to significantly decreasing water consumption.

The digitalisation and automation of the customer experience also represent an essential element of sustainable resource management. By minimising paper use through digital check-in and check-out processes, automating lighting and climate control in guest rooms, and employing smart energy management systems, hotels can streamline operations while reducing their environmental footprint.

Streamlining Operations with Technology

The profound impact of the COVID-19 pandemic, along with the emergence of digital-first Gen Z travellers, has catalysed a digital revolution within the hotel industry. Automation and technology enhancements have swiftly transitioned from being optional to becoming indispensable tools for Customer Experience Management (CEM).

One of the most visible changes has been the implementation of contactless solutions, which include mobile check-in and QR codes for menus and ordering. These innovations have drastically reduced physical touchpoints and facilitated a seamless and secure guest experience. Mobile check-in, for instance, allows guests to bypass crowded front desks and head straight to their rooms, while QR codes minimise the need for physical menus and facilitate touchless dining.

Behind the scenes, back-of-house operations have also embraced automation. Functions such as rostering, payroll management, and purchasing processes have been optimised through the integration of technology. Rostering and workforce management software allow hoteliers to efficiently allocate labour resources while adhering to labour laws and regulations. Automated payroll systems simplify salary disbursements and tax reporting, reducing administrative overhead.

Moreover, technology has redefined the procurement and inventory management processes. Automated purchasing systems help hotels optimise their supply chains, monitor inventory levels, and secure the best possible prices for goods and services. This increased transparency within the supply chain ultimately translates to cost savings for the hotel.

Perhaps the most profound impact of this digital transformation is the transition to paperless processes, leading to cost reductions and operational efficiencies. Many hotels are now operating in an environment where paper is replaced by digital counterparts, resulting in streamlined workflows and enhanced guest services.

Further, the data collected through these digital solutions offer an invaluable resource for hotels. The ability to collect, interpret, and analyse data opens new avenues for revenue management, operational optimisation, and sales and marketing strategies. With access to real-time data, hotels can make informed decisions, identify trends, and tailor their offerings to meet the evolving demands of guests.

Customer Relationship Management (CRM) in the Digital Age

In the age of digitalisation, customer relationship management (CRM) has become a crucial aspect of hotel management and forms a critical component of how to run a hotel.

With the help of CRM systems, hotels can gather and analyse customer data to understand their preferences and behaviours better. This information can be used to personalise the guest experience, leading to higher customer satisfaction and loyalty.

Moreover, CRM systems can automate various tasks such as sending out promotional emails or reminders for upcoming stays, freeing up staff time for other important tasks. However, it’s essential to ensure that the CRM system is integrated with other hotel systems for seamless operations and data flow.

Marketing and Branding

In an increasingly competitive market, the effective marketing and branding of a hotel are paramount to attracting guests and establishing a strong brand reputation. A well-structured marketing strategy can significantly impact a hotel’s visibility, customer engagement, and ultimately, its bottom line.

Digital marketing strategies play a pivotal role in modern hotel marketing efforts. These encompass a range of practices, including:

• Search Engine Optimisation (SEO)
• Social Media Marketing
• Content Marketing
• Paid Campaigns
• Search Engine Marketing (SEM)
• Influencer Marketing

Organic activity on social media platforms, such as Facebook, Instagram, and Twitter, provides an invaluable means of connecting with a wider audience. Hotels can leverage these platforms to create engaging content that fosters guest interaction and builds brand loyalty. Regular posts, stories, and live streams keep followers informed and engaged while reinforcing the hotel’s brand identity.

Reputation management is another critical aspect of maintaining a strong brand image, which is at the crux of how to run a hotel business successfully. Hotels should actively seek guest feedback, both positive and negative, to understand their experience and make improvements where necessary. Addressing guest concerns promptly and professionally demonstrates the hotel’s commitment to providing a high-quality guest experience.

Crisis Management and Resilience Planning

The hotel industry has weathered numerous crises in the past, including the Global Financial Crisis (GFC), SARS, 9/11, and most recently, COVID-19. These crises can disrupt the industry on multiple levels, be they global in nature or localised to an individual hotel.

Local crises can include safety and security breaches, loss of key personnel to labour strikes, technology failures, or reputational crises due to negative media coverage.

When it comes to how to run a hotel business successfully in the face of such crises, it’s crucial for hotels to have a comprehensive Crisis Management Plan in place. This plan should include robust procedures that identify potential risks, establish a chain of command, define roles and responsibilities, and set up a communication protocol.

The industry has adapted and learned from each crisis it has faced. A key takeaway is that the industry must be prepared, have robust processes in place, and most importantly, be nimble when a crisis arises. Some owners believe that their obligations as a director have been transferred to hotel operators under the terms of the contract, however this is not true, owners and directors still have the normal directors’ liabilities.

To ensure business continuity in the face of such situations, hotels need to have contingency plans in place. These could involve having insurance coverage, maintaining a crisis management team, and regularly updating and testing emergency response plans. In essence, resilience and adaptability are key to navigating the ever-changing landscape of the hotel industry.

How To Run A Hotel Business Successfully

Managing a successful hotel business involves careful planning and management of various resources. By focusing on these critical success factors, hotels can drive performance, increase profitability, reduce costs, enhance guest experience, ensure business continuity, and build a strong brand reputation.

Remember that success in the hotel industry is not achieved overnight but is the result of consistent efforts over time. Stay focused on your goals, be adaptable to changes in the market environment, and strive for continuous improvement in all areas of your business.

For tailored assistance and guidance in running your hotel successfully, contact Axsia HTL. We are here to help you navigate the ever-evolving hospitality landscape and achieve your goals.

In the dynamic world of the hospitality industry, the brand of a hotel stands as a formidable asset, capable of attracting and retaining customers. This allure becomes particularly potent within the fiercely competitive landscape of Australia.

Yet, as robust as the brand may be, it does not, in and of itself, guarantee the triumph of a hotel. In this ever-evolving market, where guest preferences and expectations are continually evolving, it’s the hotel management team that holds the key to success.

In this article, we delve into the pivotal role played by hotel management in crafting an exceptional guest experience. We’ll explore how the confluence of brand strength and adept customer experience management can elevate a hotel’s market standing, asset value, and overall financial performance.

The Revenue Contribution of Brand Companies

According to our expert asset and customer experience managers here at Axsia HTL, the brand company can contribute an impressive 30% to 50% of the hotel’s revenue per available room (RevPAR) through its strong distribution systems and brand promise.

These twin pillars empower the brand to attract and engage a substantial portion of the clientele, ensuring that rooms are occupied and revenue streams flow consistently. It’s this very strength that often draws hotels into partnerships with renowned brand companies.

The rest of a hotel’s RevPAR depends on managing customer experience in a way that enhances guest satisfaction, loyalty, reputation, and demand through creating a “mini-brand” that resonates with its target market.

This “mini-brand” should mirror the aspirations, preferences, and expectations of the guests, acting as the bridge between brand promise and customer fulfilment. Here, every interaction, from the initial reservation to the final checkout, is a carefully orchestrated act, designed to leave an indelible impression. This is where a strong CEM strategy is essential when looking to enhance overall property asset value.

The Pitfalls of Cost-Cutting in Hotel Management

Unfortunately, many hotel managers resort to cost-cutting measures as a quick fix to maintain profitability, especially in the wake of the COVID-19 pandemic. This can have negative consequences for the quality of service, customer retention, and long-term value creation.

Instead, owners should actively engage with their hotel managers, posing critical questions about the strategy in place and how it aligns with the overarching brand vision and customer requirements. Hotel success is not just about numbers; it’s about creating a memorable and lasting experience for guests that keeps them coming back and recommending the establishment to others.

By taking a holistic approach and focusing on customer experience management, hotel owners can steer their properties towards sustainable success, even in challenging times.

Customer Experience Management (CEM) as a Solution

In the ever-evolving landscape of the hospitality industry, managing customer experience has emerged as a powerful solution to unleash the full potential of a hotel property. At Axsia HTL, we firmly believe that customer experience management (CEM) is the cornerstone upon which a hotel’s success is built.

CEM represents a comprehensive approach to crafting and optimising the interactions between customers and the hotel at every touchpoint of their journey, from the initial pre-arrival phase to the post-departure experience.

It’s more than just ensuring guests have a pleasant stay; it’s about orchestrating a symphony of experiences that resonate with guests on a personal level.

The essence of CEM lies in its dedication to understanding the guests’ unique identity, preferences, and desires. This in-depth comprehension is crucial in shaping the experiences that not only meet but exceed their expectations.

Every guest interaction, be it during the booking process, check-in, dining, or any other aspect of their stay, is seen as an opportunity to delight and create lasting memories.

Customer Experience Management Platforms

Pivotal tools in a hotel’s CEM arsenal are its customer experience management platforms, often referred to as customer experience technology (CET). There are plenty of tools available from the more basic CEM designs to advanced software for large chains.

The technology in these platforms empowers hotels to gather and analyse data from various sources to construct a detailed profile of their guests.

This profile, built upon demographics, behaviours, preferences, and feedback, serves as a blueprint for personalised experiences. From room preferences to dining choices and even recreational activities, a customer experience management platform allows hotels to tailor every aspect of a guest’s stay.

CET allows hotel management to better understand their guests’ behavioural psychology, allowing them to:

• See important customer information
• Track how customers interact with the hotel’s website and booking system
• Navigate the hotel’s website
• Automate better customer interactions with AI
• Identify guest pain points
• Gain valuable data from wider market pools

By integrating a preferred platform into their operations, hotels can ensure a seamless and consistent experience throughout a guest’s journey. This cohesiveness builds trust, enhances guest satisfaction, and ultimately fosters loyalty.

Benefits of Implementing CEM Principles

By applying CEM principles and practices, hotel managers can achieve several benefits, such as:

Increasing Customer Loyalty

Loyal customers are more likely to return, recommend, and spend more at a hotel. They also provide valuable feedback and insights that can help improve service quality and innovation.

Improving Online Reputation

Online reviews and ratings are influential factors for customers when choosing a hotel. Positive reviews can boost the hotel’s visibility, credibility, and attractiveness on online platforms and social media.

Generating More Demand

By creating a distinctive and consistent customer experience that matches the brand promise, hotel managers can differentiate themselves from competitors and attract more customers who are willing to pay a premium for their services.

Enhancing Profitability

By increasing customer loyalty, reputation, and demand, hotel managers can also increase their RevPAR and profit margins. Moreover, by investing in customer satisfaction through key areas like strategic property asset management, they can reduce customer acquisition costs, staff turnover, and operational inefficiencies. This, in the long run, is a much more viable option than cutting costs.

Strategic Approach to Effective CEM

A strategic approach to effective customer experience management (CEM) is the bedrock upon which hotels build enduring relationships with their guests and ensure long-term success in a highly competitive industry.

To successfully implement CEM, hotel managers must embrace a multifaceted strategy that is both proactive and deeply attuned to guest preferences. Here’s a closer look at the strategic approach that underpins effective CEM:

Conduct Comprehensive Customer Research

At the heart of CEM is a profound understanding of the guests. Hotel managers need to conduct extensive customer research to gain insights into their target audience. This research encompasses various dimensions, including demographics, preferences, behaviours, needs, and pain points.

Such in-depth knowledge provides a foundation for crafting experiences that truly resonate with guests. To gather this information, hotels can employ a variety of research methods:

• Surveys: Surveys are a traditional yet highly effective means of collecting feedback and data from guests.

They can be administered before, during, or after the guest’s stay to gain insights into their expectations and experiences.

• Focus groups: Focus groups bring together a select group of guests to explore their perspectives, delve into specific areas of interest, and brainstorm potential improvements.
• Observation: Observing guest interactions and behaviours within the hotel provides a wealth of information. From their choice of amenities to their dining preferences, every action offers insights.
• Online analytics and CET: Leveraging customer experience technology (CET), hotels can gather data from online interactions, booking histories, and website visits to create a more comprehensive view of their customers.

Advanced analytics tools provide real-time data that can be analysed to spot trends and patterns.

Segment and Target Customers

Building upon the insights garnered from customer research, hotel managers should focus on segmenting and targeting customers. Not all guests are the same, and recognising this diversity is key to delivering personalised experiences. The strategic approach involves:

• Identifying profitable and loyal segments: Not all customers are created equal. Some are more profitable and loyal than others.

By identifying these segments, hotel managers can allocate resources more efficiently and create tailored experiences for their most valuable guests.

• Defining value proposition and positioning: For each customer segment, hotels need to develop a unique value proposition and positioning strategy. This entails crafting a clear and compelling message that reflects what the hotel can offer to that specific segment.

Whether it’s a family-focused experience, a luxury getaway, or a business-oriented stay, the message should align with the needs and preferences of the targeted audience.

Discover Premium Customer Experience Management with Axsia HTL

Elevating your hotel’s customer experience can transform it from a place to stay into a cherished destination where guests return time and time again. At Axsia HTL, we understand the pivotal role of customer experience management in nurturing guest loyalty, enhancing your online reputation, driving demand, and ultimately boosting profitability.

Our strategic approach, grounded in comprehensive customer research and thoughtful segmentation, ensures that every guest’s journey is distinctive and memorable. By offering personalised experiences that align with the diverse needs and preferences of your guests, you can set your hotel apart in today’s competitive landscape.

Contact us today to embark on a journey towards customer-centric excellence. Our CEM services empower your hotel to offer the exceptional experiences that modern travellers crave. It’s time to go beyond traditional hospitality and embark on a path that nurtures long-term success.

The landscape of revenue management in the hospitality industry is undergoing a seismic shift. In an age defined by technology and changing customer preferences, the tried-and-true practices of revenue management have evolved, creating both challenges and opportunities for businesses.

With the emergence of innovative tech, shifts in customer expectations, and ever-changing market conditions, revenue management professionals are at the forefront of a dynamic industry.

In this article, we’ll explore some of the trends and developments that are shaping the future of revenue management in the hospitality industry, and how revenue managers can leverage them to optimise their revenue performance.

Definition of Revenue Management in Hospitality

Revenue management in the hospitality industry is the art of applying data-driven strategies to maximise revenue and profitability.

It encompasses everything from predicting demand, determining the best prices, managing inventory, and distributing products and services through various channels. It has played a pivotal role in the success and competitiveness of many hotels and resorts for decades.

At Axsia HTL, we have extensive experience in designing and optimising such strategies. One of our best examples of revenue management and asset management is our recent collaborative approach for a 5-star resort, which showcases how using data and trends can elevate success even during and after the turbulence of COVID-19.

Speaking of the pandemic, it’s clear that the hospitality industry has changed drastically over the last several years. Even before this abrupt change, however, we were seeing things beginning to shift in the hotel industry.

The Changing Landscape

It’s no secret that good revenue management strategies have been key factors in the success and competitiveness of many hotels, resorts, and other hospitality businesses in the past decades.

However, the hospitality industry is undergoing rapid and profound changes due to the emergence and evolution of new technologies, customer preferences, market conditions, and business models. Let’s take a closer look at the changing landscape of hotel revenue management strategies.

Technological Advancements

Advancements in technology have revolutionised revenue management practices, enabling revenue managers to collect, process, analyse, and act on large amounts of data from various sources. Think valuable and data-rich streams like customer behaviour, market trends, competitor actions, social media, online reviews, weather, events, you name it.

Technology also allows for the automation of many tasks that were previously manual and time-consuming, such as pricing, inventory management, distribution and reporting. Tech programs that streamline these administrative processes have been game-changers in the industry.

Despite these positive outcomes, we’re also seeing technology increase the complexity and dynamism of the market environment. This presents an interesting new landscape that poses some challenges, particularly in customer preferences.

Shift in Customer Preferences

Thanks to technological shifts and subsequent market changes, customers have more choices, information, and power than ever before.

They can easily compare prices, products, and services across different platforms and channels, such as online travel agencies (OTAs), metasearch engines, direct booking websites, and mobile apps. Customers can also switch between different providers and channels at any time, depending on their preferences.

It’s therefore crucial that revenue managers adopt a customer-centric approach to revenue management strategies in the hospitality industry. Managers can effectively use technology to:

• Understand the needs, preferences, expectations, and behaviours of their customers across different segments, markets, channels, and touchpoints.
• Segment their customers based on various criteria, such as demographics, psychographics, booking patterns, and loyalty status.
• Monitor and measure customer satisfaction and loyalty across different channels and touchpoints.
• Communicate and engage with their customers before, during, and after their stay.

Evolving Market Conditions

Alongside these fast-moving tech advancements, the hospitality industry is constantly evolving, with unforeseen disruptions and changing customer preferences driving shifts in market conditions.

To remain competitive, businesses must adapt and innovate. Revenue managers are essential in helping companies navigate these dynamic changes, such as:

• Global events and uncertainties like the COVID-19 pandemic: Revenue managers play a crucial role in adjusting pricing models, assessing trends, and handling uncertainties, ensuring businesses can thrive during such disruptions.
• Intensifying competition: With increased competition, businesses need to innovate continually. Revenue managers offer valuable insights into pricing, distribution, and market trends, enabling businesses to identify growth opportunities and enhance revenue performance.

Embracing Innovation

With so much rapid change in the hospitality industry at the moment, it can be easy to feel overwhelmed. Our core piece of advice when devising new revenue management strategies is to embrace innovation.

Businesses who dare to push the envelope with bold ideas and new technologies will not only stay afloat in times of change, but will rise above the competition to new and exciting heights.

The Need for Creativity and Flexibility

In the ever-changing world of revenue management, adaptability and innovation are non-negotiable. It’s no longer enough to rely solely on traditional methodologies.

Creative solutions and flexible strategies are key to thriving in this dynamic landscape. Revenue managers must go beyond the numbers and embrace a holistic perspective. They need to craft inventive pricing structures, leverage advanced data analytics, and embrace innovative technology to stay ahead.

These imaginative approaches help set new industry standards and create a clear path towards enhanced profitability.

The Role of Revenue Managers

In the current hospitality landscape, revenue managers have evolved into customer-centric strategists. Their role extends far beyond mere number-crunching.

By understanding and segmenting customers based on a myriad of criteria, revenue managers can tailor experiences to meet specific needs and preferences. They employ cutting-edge technology to track satisfaction and foster loyalty throughout the customer journey.

These managers act as conduits between data and guest expectations, ensuring that each visitor’s experience aligns seamlessly with the brand’s vision and market positioning. Their customer-focused approach leads to not only increased revenue but also enriched brand loyalty, setting the stage for continued success in a competitive market.

Trends Shaping the Future

When looking ahead, we’re seeing several clear trends emerging in effective hotel revenue management strategies.

While it’s always important to tailor your own strategies to the needs and circumstances of your business, we recommend looking out for these areas and implementing them as core ways to expand and improve your planning.

Personalisation and Customisation

Personalisation and customisation can increase the revenue and profitability of a hospitality business in a few key ways. It can:

• Enhance customer satisfaction and loyalty, as customers feel more valued and appreciated by the hospitality provider.
• Increase customer willingness to pay, as customers perceive more value and differentiation from the hospitality product or service.
• Create more cross-selling and up-selling opportunities, as customers are more likely to purchase additional products or services that match their needs or preferences.

So, what are some examples of revenue management personalisation strategies?

• Revenue managers who effectively use technology to collect and analyse data about their customers across different segments, markets, channels, and touchpoints.
• Customer profiles and personas created from this data that capture the needs, preferences, expectations, and behaviours of the target demographics.
• Customised products or services offered to customers across different channels and platforms.
• Revenue managers who monitor the impact of personalisation and customisation on customer satisfaction, loyalty, revenue, and profitability.

Benefits of Integrated Systems

Integrating different revenue management systems is vital to overcoming inefficiencies and errors in the process, such as incomplete data, analyses based on faulty models, inaccurate forecasting due to insufficient data, or inconsistent pricing across different platforms.

To overcome these issues, integrated systems are starting to be operated by different departments or functions within many hospitality businesses, such as sales, marketing, operations, and finance.

We’re also seeing them being used by different external partners or providers, such as OTAs, metasearch engines, and revenue management software vendors.

An integrated system enables revenue managers to:

• Access and consolidate data from various sources in a single platform.
• Apply consistent and comprehensive analysis and forecasting across multiple services.
• Implement optimal and dynamic pricing strategies.
• Manage inventory effectively and efficiently.
• Distribute products or services optimally and strategically.
• Generate timely and clear reports on revenue performance and outcomes.

Expanding Beyond Room Rates

The final trend that’s making waves is expanding beyond room rates. While room rates remain the main source of revenue for most hotels, it’s important to remember that they’re not the only source – far from it.

Customers are more and more seeking a holistic experience from their accommodations that extends beyond their rooms. Expanding revenue management to include other products and services, such as F&B, spa, events, and parking, increases total revenue per available room (RevPAR). This KPI plays a major role in enhancing profitability and customer satisfaction.

Adapt to the Future of Revenue Management With Axsia HTL

As revenue management transforms, revenue managers must embrace innovation, flexibility, and customer-centric practices to optimise revenue performance and drive success in the evolving hospitality industry.

By leveraging trends and developments, revenue managers can also optimise their revenue performance and create more value for their customers and stakeholders.

If you’d like assistance with creating your revenue management strategies, the team at Axsia HTL is here for you. Our extensive experience in hotel asset management and advisory services, and with a keen eye on the market and latest trends, we know what makes things tick when it comes to hotel management.

Get in touch with us to talk about your revenue management strategy today.