Investment
Vaccines for Hotel Sales

News from last week show that some countries in Asia are already recovering their direct bookings. What you do now will make a big difference when your Business goes back to normal.  An article by Rodrigo Mendonça Mergulhão (Digital Marketing Professional) and columnist for Jornal de Negócios. 

"Hoteliers are working seamlessly with daily cancellations and with new bookings dropping dramatically. In times of crisis, it is good to remain calm and look at the history that teaches us tremendously. We realized that, when it comes to crisis management, nothing else matters, and here are 3 examples that history has taught us.

One of those many teachings and hard times is undoubtedly World War II. At this point the whole economy stopped, there was a lack of products and services, rationing and pessimism in everything. One of the things that smart brands did was to continue advertising, even without selling the product or service. The message was to demonstrate optimism and announce everything that was being prepared and that would be made available in a post-war period. In the US, the state supported advertisers by giving incentives for the amount they invested. The brands were seen as patriots and gained a good reputation in the market. All these brands had good results in the post-war and ended up gaining market share to the competition that didn’t followed this approach.

More recently, a study by Cornell during the 2009 crisis, showed that hotels that invested in marketing had superior performances in the main indicators, revenue per available room (REVPAR), occupancy and profitability. See Cornell study ("Winners and Losers during the Great Recession: The Positive Impact of Marketing Expenditures ").

Considering the catastrophic impact of the COVID-19 by all industries, mainly in the Tourism industry, there are some measures that should be implemented as soon as possible by hoteliers:

  • “Stay Calm but active” strategy:

The best attitude is to always stay calm! Ensure that the prevention and control measures indicated by the Health Authorities are implemented. Treat employees and guests with the maximum attention and care.

 

Then, don't react by drastically cutting down rates or marketing efforts. Historical data show that hotels that have not cut marketing efforts in previous crises but selected carefully what marketing investment to do and focused on them, performed better than others. Conclusion: don't slow down, but don't ignore. Adapt and focus your investments and on your message. For example, "See what we have in store for you, post-covid!"

 

  • “Keep Cool and focused” Plan:
    A "Keep Cool" marketing plan must include targeted and smart campaigns and work to ensure the future. Ensure that we do not lose any notoriety in the markets and prepare ourselves in the best way for a strong comeback. Here are some points that can be worked during the following weeks:
    1. Focus on your customer database. This is a time to be close to those who have already stayed at the hotel, to be close to those who have had a good experience, with a message of optimism and an invitation to return when all is well.
    2. Focus on the leisure / local private segment. Even if individuals have postponed their holiday bookings or short breaks, in a month or two they will do it again. And if not by plane, why not travel by car? Local market, in our case Portugal and a good part of Spain (when the storm passes), may be a good alternative as a got-to-now target, as we have seen from the recovery and recent results of some countries in Asia. Take a vacation, within your country!
    3. Focus on making the cancellation policies more flexible. If there is a risk-free incentive for booking a vacation, then why not? #Flexible Cancellations
    4. Focus on preparing competitive offers. Not cutting the daily rates for comparison, be prepared to launch competitive offers with 30% discount or more, when booking packages (Stay Longer, spend less). If the competition forces you to do so, be prepared for powerful flash sales, as it is the only way to acquire the low demand that still exists. Always with a positive message, of hope and care for the population.
    5. Focus on improving direct channels, with greater profitability. Take the opportunity to work on your website’s SEO. Even in normal circumstances, this is a topic that takes time. Knowing what the correct keywords are and implementing them properly across the various pages of the website, to improve your website's position in the search engines is always a profitable investment. This is a good time to do so, all the SEO work can start now. Or if you are still at an early stage, improve your website with content that demonstrates your position and that sets you apart from the competition. Because, even if it is just another sale without paying commissions, now this sale worth’s so much.

 

3 – Capture the local market

News from last week show that some countries in Asia are already recovering their direct bookings. Hong Kong for example had a significative increase in their bookings by capturing the local market.  What you do now will make a big difference when your Business goes back to normality. After reaching a low in early February, in 30 days direct bookings increased by 270%, according to a Triptease report.

Therefore, if you are careful with what you do today, you will harvest all the benefits in the future, don't doubt that!"

Jornal de Negócios 

Contact us should you have any questions concerning investing in Portugal. 

 

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