INTRODUCTION HOSPITALITY MARKETING

TOPIC - I

In 1950s, hotels in US began to change, driven by changes in the society around them: 1. Population growth

2. Longer life span

Not only did the population grow, it became older and these new families started relocating.

3. Improved incomes

Family incomes improved.

4. Increased leisure time

Additional legal holidays were given to workers.

5. Expanded highway system

Soon became an important factor in the no: of Americans traveling, both for business and leisure. It also helped the local travel simple.

Vehicle registration grew phenomenally and Americans

took to the roads in great nos.

6. Development of suburbs
As a result, new residential neighborhoods were established in the suburbs which were followed by retail shopping centers, office buildings, and

recreational and entertainment facilities, all of which

attracted increased traffic and the need for

accommodations and meeting space.

7. Increased air travel

Air travel also became a commonplace part of the American business and leisure scene.

8. Convention center expansion

The 1950s and 1960s ushered in a booming US economy. As businesses grew, business people needed facilities for convention and meetings.

8. Convention center expansion

As businesses expanded into the suburbs or outgrew the limited facilities of the smaller convention centers, there was a boom in the construction of convention hotels, both in the cities and in regional

and resort destinations.

What does these factors have to do with hospitality Sales & Marketing?

The answer is simple :

everything !

Changing times had a great impact on the hospitality industry, and the industry had to evolve tremendously to meet the new challenges posed by a changing society.

To meet the demands of road travelers in the 1950s, the industry responded with development of a no: of chain properties: Holiday Inns, Ramada Inns, Howard

Johnsons, and Travelodge were among the lodging

pioneers along interstate highways.

Each of these chains introduced its own standardized designs, amenities, services, and referral networks; each became easily recognizable (both in terms of

service and market image) in the eyes of the

traveling public.

The growth of these and other chains coupled with developing technology ushered in the first toll-free reservation systems in the 1960s, a decade that also

introduced the first budget hotels.

These back to basics budget properties did not come into great prominence until the 1970s, when runaway inflation, fuel shortages, and budget

cutbacks on the part of many companies resulted in

an unprecedented belt-tightening among travelers.

1980s have also changed the face of the hotel industry, a no: of large convention hotels such as the Las Vegas Hilton, the New York Marriott Marquis, the Hyatt Regency Maui.

Even small hotels are catering to the business traveler

with executive floors, business services, and fitness

amenities that were virtually non-existent ten years

ago.

Todays Hospitality Trends

Current and emerging economic, social, and political trends can greatly affect future demand for hospitality services, and must be identified before a

property can position itself competitively in the

market place.

TRENDS
It includes;

1. Computers
2. Distribution method

3. Media planning

TRENDS

4. Competition 5. Guest preferences 6. Product segmentation

1. Computers
Use of computers has revolutionized central reservations systems and has provided direct link to travel agents and airline reservations systems for

instantaneous verification of room arrangements.

1. Computers
It plays an important role in areas as diverse as generating marketing data bases (both for current and future guests), following up on sales efforts, and

sending personalized sales letters.

1. Computers

It is also an indispensable tool for managing research information, generating monthly reports, and planning sales & marketing efforts.

2. Distribution method
New distribution technology will not be limited to third-party suppliers. Direct-to-the-consumer technology is now being developed that will permit a

potential guest to buy flight and room packages in

the comfort of his or her home through internet.

3. Media planning

Media planning plays an important role hospitality sales & marketing. Earlier we had only few media options. Today its wide open print and broadcast media, internet !!

3. Media planning

With wide range of media choices, audiences have become smaller, it has become necessary to narrowcast advertising. Marketers must develop advertising and promotions that appeal to specific

markets.

4. Competition
The changing competition is another important consideration in todays marketplace. More hotels are seeking affiliations in order to compete with large

chains, who have the budgets and the clout to

command a large share of the hospitality business.

5. Guest preferences

Todays guests are more sophisticated, more informed, and know exactly what they are looking for. These experienced traveler wants value, but services and amenities are important too.

5. Guest preferences
Because of changing guest preferences and the addition of new market segments (SLT Single Lady Travelers), properties have had to re-evaluate their

target markets and reposition themselves to be more

competitive.

5. Guest preferences

This has led to perhaps the most important trend in todays marketplace: product segmentation or product categories.

PRODUCT SEGMENTATION

It is designing, building, and/or marketing hospitality properties for a specific market segment.

Hospitality Product Segment

1. Luxury
2. Mid-priced 3. Budget

Now there are segments within these segments, and hotels are creating brand images and names to distinguish their properties from competing properties.

Today, product segmentation has taken three basic forms: 1. Tier or niche marketing 2. Hotels within hotels

3. All-suite hotels

1. Tier or niche marketing

Tier marketing was established as properties became aware that there was an increasing no: of market segments with varying preferences and budgets.

 Quality Inns was the first chain to adopt a multi

tiered marketing strategy ,and introduced Comfort

Inns (budget properties) Quality Royale (upscale

properties) to compliment its mid-priced Quality Inns product.

 The other chains quickly followed this, some by developing different brand names to attract new market segments, others by buying existing chains

(as in the case of Holiday Inns, which purchased

Granada Royale Hometels )

What were the reasons for this sudden diversification of hospitality properties?

 The recognition on the part of some chains that additional markets needed to be targeted in order to meet the goals of aggressive growth plans.

 The need to identify the variations in facilities, price and service between properties within a chain.

 The chains attempt to instill brand loyalty in their guests, a strategy that has long been used in the sale of consumer goods.

 The trend toward upscale and economy properties

The fact that many mid-priced properties were finding it difficult to compete because of their age and condition.

With so many hotel chains the diversifying to reach as many market segments as possible, it is important that a chain make the distinctions among its properties clear.

The Radisson hotel chain, for example, uses different names to distinguish its properties:

 Radisson Plazas are deluxe facilities featuring a minimum of 250 guestrooms and 40-50 square feet of meeting and function space per guestroom.

 Radisson Hotels feature a minimum of 200 guestrooms and 50-70 square feet of meeting and function space per guestroom

 Radisson Inns cater to the roadside traveler, and have a minimum 150 guestrooms and 3040 square feet of meeting and function space per guestroom .

 Radisson Resorts are designed to serve incentive groups and high-class meetings with a minimum of 200 guestrooms and 45-50 square feet of meeting and function space per guestroom.

These properties are promoted differently, but are promoted to generate a brand loyalty in this case, a brand loyalty to Radisson properties.

Brand loyalty has been used in other industries, such as automobile industry, for years, and involves capturing the consumer and moving him or her

up to the next product tier as wants and desires

change.

In the case of automobile industry, for example, a young man might purchase a Ford Escort for his first new car, then later graduate to a Ford Taurus as his family grows.

As his career and salary rise, he will, if he remains loyal to the Ford brand, choose another Ford product a Lincoln or Thunderbird over other luxury cars.

Hotels Within Hotels

Product segmentation is not limited to chains acquiring or building different types of properties.

The hotel within a hotel concept has proved popular, especially with upscale guests who appreciate having a club or floor reserved exclusively for their use.

Sheraton and Hilton hotels offer Tower sections, Hyatt promotes a Regency Club, and Marriott offers a Concierge (care-taker) level. Other properties also promote business clubs, floors, and/or services.

All-Suite Hotels
This has become an integral part of the hospitality industry, and appeals to value-conscious travelers who do not want to pay for extra amenities they

would not use at a traditional hotel (a lounge,

swimming pool, health club, and so on), as well as

travelers who enjoy the extra comfort a suite can

provide during extended business or pleasure stays.

THE NEED FOR PROPERTY/HOTEL MARKETING

For years the hospitality industry focused on selling guestrooms and other services and facilities. In todays sophisticated marketplace, however marketing has become the buzzword;

Properties have shifted from a strictly sales orientation to marketing in order to understand and manage the relationship they have with the client or guest.

What is the difference between marketing and

sales ?

Marketing is basically the study and management of the exchange process.

It involves those things that the property will do to select a target market and to stimulate or alter the

demand for the propertys services.

While marketing includes sales, it also involves a no: of other factors: research, action strategies, advertising, publicity, and sales promotion, as well as a means to monitor the effectiveness of the marketing program.

Sales consists of direct efforts to sell the property by personal contact, telephone, and mailings. It is important to note that the sales process has been

changed considerably by new marketing concepts

that focus on what consumers want rather than on

what the property has to sell.

Example : the establishment of no-smoking rooms in response to requests from health-conscious guests. Because of marketing research, more properties are

developing features for sales people to sell, rather

than just trying to sell existing features.

Marketing Focuses Vs Sales Focuses

M Market analysis, planning and control.

S Field work & desk work to sell to consumers.

Marketing Focuses Vs Sales Focuses

M Long term trends, how to translate problems and new opportunities into new products, markets, and strategies for long term growth.

S Short term considerations, such as todays

products, markets, consumers, and strategies.

Marketing Focuses Vs Sales Focuses

M Profit planning, such as determining the appropriate mix of business from individual market segments.

S Volumes and quotas, current sales, bonuses, and

commissions.

Marketing, then, focuses on the researching of trends and the development of successful sales techniques and efforts.

Successful sales of the property depend on effective strategies, which can only be developed by focusing on market variables the environment

(uncontrollable or external variables), and

controllable variables inherent in the property (the

marketing mix)

THANK YOU

difference between hotel and resort,

hotel as a product,

elements of marketing,

market segmentation,

benefits and needs of segmentation,

types of segmentation,

basic operations and functions of a hotel and a resort,

Market segmentation in the hospitality industry and how it differs from product segmentation