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–––––––––––– Converging on Success ––––––––––––

Best Practices for Managing Convergence in Hospitality Sales, Marketing, and Revenue Optimization

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© 2012 Hospitality Sales & Marketing Association International

In partnership with Sabre Hospitality Solutions

Contents

Introduction ................................................................................................................................................ 2

Keys to Success ........................................................................................................................................... 3

Technology Platforms ................................................................................................................................. 4

Roles & Responsibilities .............................................................................................................................. 5

Channels on Mobile Devices ....................................................................................................................... 6

Social Networking & Marketing .................................................................................................................. 7

Social Media & Revenue Management ...................................................................................................... 8

Content Across Channels ............................................................................................................................ 9

Content on Search Engines ......................................................................................................................... 9

Acknowledgements ................................................................................................................................... 11



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Introduction Convergence is a powerful force that is impacting the design of hospitality sales and marketing. Driven by a new breed of travel consumer who has an insatiable thirst for engagement and control, and fueled by emerging technology platforms, new channels, endless touchpoints, the dominance of mobile devices and the social movement, the move toward convergence requires a new mindset and set of strategies that demand collaboration and connectivity.

As digital marketing practices and the distribution landscape continue to evolve, there is an overall convergence of disciplines that defies traditional sales and marketing structures and challenges traditional thinking. It requires hoteliers to take a holistic approach to demand generation, digital distribution and revenue optimization.

Convergence addresses the ways that systems, practices and individuals need to collaborate and share for optimum results. And it’s happening all along the travelscape. Channels are converging due to new technology and a shift in consumer behavior. Hotel reservation technology is converging with behavioral marketing customer relationship management (CRM) solutions. CRM solutions are converging with eCommerce to support the multi-touchpoint customer experience. Information is converging with advanced analytics to generate demand when a hotel needs it. And so on.

Convergence can quickly become chaos without a systematic plan that addresses the pinch points, overlap and redundancy between job roles. It can be likened to a sold out stadium emptying out of the parking lot into the side roads and transportation systems. Without ample preparation, and guidance by professionals, this convergence can quickly amount to disorder and strain on the system.

According to Forrester, “Organizations need to reconfigure resources and capabilities to stay ahead of the rate of change as consumer technology adoption and behaviors change. The customer is now at the center, and delivering relevant content, commerce and service is the key to delivering on the new reality. That means identifying how to optimize processes, people and technology to engage and satisfy today’s empowered, 24/7, on the go and in control customers across the rapidly evolving set of customer touchpoints.”

To improve the customer experience, it’s not just about offering the best products and services but the quality of the customer interaction at every opportunity. The brilliance of convergence is that different technologies, platforms, channels and disciplines are combined to create powerful solutions that when merged are so much greater than the sum of their individual parts.



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Today’s consumer is sophisticated, demanding and informed, they are in control, and as a result of their wants and needs, they will force conversion. They operate around the clock via social networks and mobile devices, and want a relationship to cross every channel and device in their life. They want interaction, instant gratification, convenience and control over their experiences. In this customer-centered environment, you need to meet them where they are, be highly personal and give them what they’re looking for.

With that understanding, the opportunity is to take what you can learn about the customer and converge the platforms, tools and channels to capture their engagement and gain their loyalty and trust. The following best practices can serve as your guide to navigate the cluttered streets of convergence.

Keys to Success 1. Deep customer engagement requires the right technology framework. The ideal approach is a

converged enterprise platform with a single data model and point of management that will support all requirements for an hotelier including distribution, marketing, rate and inventory control, guest management and property operations.

2. With the customer now at the center, content and relevancy are paramount. Delivering dynamic and personalized content, consistent over all channels, will help you convert visitors into bookings. Your Content Management System (CMS) should be able to push content not only to the hotel website but simultaneously to social media channels, the mobile web and your email lists. In the ideal scenario, your CMS would be one and the same as your enterprise platform. In other words, your CMS would no longer be siloed but would push content beyond your marketing channels and into your call center, front desk, OTAs, and in-room TV as well.

3. The mobile mindset needs to go beyond that of a device or provider of content but a platform where distribution channels, social networking, marketing services and customer relations converge.

4. One of the most powerful ways to create meaningful experiences with target customers comes from the convergence of social, local and mobile (SoLoMo). Use this opportunity to deliver more personalized, relevant content and engage existing guests and potential customers like never before.

5. Social networking has had the most profound effect on the digital marketing landscape and engaging customers through social marketing is a must. Hoteliers need to dominate the total travel experience by anticipating the traveling consumers’ desires along their journey, from planning to post stay.

6. Adjust your mindset. Ad dollars, marketing messages, distribution channels and revenue management tactics can all benefit from the added insight and data points new technology has afforded the travel landscape.



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7. Revenue management has transitioned to being highly customer-centric and driven by distribution and competitive pricing strategies. Take control over price, marketing and market share by having a distribution strategy with consistent pricing and branding across all search engine channels, and understanding how it impacts revenue management.

8. As social media channels are increasingly used as an extension of a rewards program, incorporate preferences that consumers want in social networks into those offerings. Use that intelligence to create better promotion and pricing decisions to generate short-term revenue.

9. Marketing to the on-demand consumer requires a multi-channel marketing approach. Follow the path your customer takes and know which channels they use, when they use them, and how they use them so you can have a presence and create personalized transactions and guest experiences. In the digital age, every marketing touchpoint, formal or informal, has the capability of becoming a point of sale, so treat it as such with easily digestible nuggets of content and contextually relevant cross selling.

10. As each discipline become more dependent on the other, it’s important to understand how roles and responsibilities have evolved and identify the right organizational structure to achieve a holistic, collaborative environment. There needs to be a collaborative relationship between revenue management, distribution, marketing and sales that allows accountability, communication and cooperation. Take down the walls and understand each other’s roles, talk the same language, identify collaborative tools, hold hands and use the same set of metrics.

Technology Platforms Convergence at the technology level has a profound effect across the industry. It changes the way of thinking from systematic to strategic. It invites endless opportunities for innovation across devices, channels and strategies.

As you move towards deep customer engagement, there must be the right technology framework to enable this shift. In the ideal scenario, it operates from a cloud-based, single source data entry system where technologies talk to each other and supports all requirements for a hotelier including distribution, marketing, rate and inventory control, guest management and operations.

The convergence of property management (PMS), customer relationship management (CRM), revenue management (RMS) and central reservations (CRS) systems will provide better channel and revenue management, pricing and inventory control, and can deliver untapped customer and revenue management capabilities. It encompasses everything from content distribution, social engagement, online presence, how a product is considered, assessed, booked and reviewed across the travel landscape. It also delivers a complete picture of each individual consumer that can be applied to every single initiative from marketing initiatives and CRM to distribution management, rate and inventory control and guest management.



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“Let’s just think about hospitality technology for a moment,” asserts Mike Kennedy, Vice President, Business Development at Sabre Hospitality Solutions. “From CRS to PMS, RMS and beyond, behind each acronym is a solution that relies upon interfaces and integration with one or many other third party systems. At the center is the growing cost to maintain and coordinate redundant functionality (70 – 80 percent), business logic, data and processes in these solutions. If the customer is indeed at the center, hoteliers need a solution that can converge the common activities around rate management, distribution, profiles and content. It simply defies logic to undertake these activities in multiple systems across each of the internal disciplines and yet the industry continues to absorb both the pain and cost associated with doing just that.”

With the evolution of the cloud and affordable bandwidth, it is possible to imagine a world where the marketing, revenue and sales team all use the same enterprise management platform. Imagine a platform providing a single view of the customer and a single point of management for rates, availability and inventory across the hotel estate or description and rich content, whether it is on a hotel website, channels, social media or in room TV.

With distribution being the major force in a hotel’s ability to drive demand and maximize its revenue and profitability, there needs to be an understanding of how to distribute the right product over the right channels at the right price at the right time to the right customer. Revenue management holds demand forecasts and marketing knows the customers, their buying behavior and product preferences. They need to converge to reach guests wherever they are via whatever means or device they choose.

To the user, content and relevancy are paramount, and so dynamically delivered personalized content, consistent over all channels, will help hotels to convert visitors into bookings. Your CMS should be able to push content not only to the hotel website but simultaneously to social media channels, the mobile web and your opt-in email database.

Distribution is so much more than rate and inventory. It requires converging technology that provides a holistic view of inventory and customer that transcends to marketing initiatives, distribution management, rate and inventory control and guest management. Achieving the optimal channel mix and effectively penetrating hundreds of distribution channels takes the convergence of relative content, consumer intelligence, brand imaging and promotional messaging along with the technology platform that can deliver that knowledge at the right time across multiple channels. By monitoring and measuring traffic from every channel to uncover your customer’s preferences and stay patterns, you can apply it to every touchpoint to optimize bookings, branding and loyalty.

Roles & Responsibilities The human factor is an area where convergence is a critical driver. As each discipline become more interdependent, it’s important to understand how roles and responsibilities have evolved and identify the right organizational structure to achieve a holistic, collaborative environment. In a recent qualitative study performed by Transparency, a leading market research firm, every respondent in an audience of nearly two dozen, noted seeing convergence between job roles in their company.



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“Convergence brings about a paradigm shift that requires hoteliers to rethink internal processes and methodology,” remarks Kristie Goshow, Vice President, Marketing at Sabre Hospitality. “As technology merges and consumers converge in channels, so do disciplines. The increasingly complex nature of the travel landscape has facilitated the need for a collaborative relationship between revenue management, distribution, marketing, and sales that allows accountability, communication, and cooperation.”

As platforms and processes become increasingly complex, and disciplines become intertwined, the sharing of information is critical, and data intelligence needs to be accurate, timely and accessible. The disciplines and efforts need to converge. That means taking down the walls to understand each other’s roles, talk the same language, identify collaborative tools, hold hands and use the same set of metrics. Teams need to be well orchestrated to handle a customer’s needs from a centralized place.

What may have once been the responsibility of one department, may very well be better managed by another, or collaboratively. As social media sites such as Facebook and Twitter become places of true engagement, who is the responder? Does that differ when it’s a question about a room versus a complaint about a stay or a query about a rate? How is that structured to provide immediate feedback whether it’s in the interest of selling, engaging or managing your reputation? Consider how customers are using the channels and restructure internally to answer that or retrain to meet those changes.

And with that lies the question, who steers the ship? Can it be done collaboratively through a task force approach or does there need to be a “chief convergence officer” at the helm? Each organization must find the right solution that shifts the structure from independent silos to collaboration. At the same time, recruitment and training must emphasize the cross pollination of knowledge between the groups and ensure everyone is embracing the end goal of providing a higher, more personalized level of service to your guests.

When thinking about your organizational structure, consider the cycles of the well-connected traveling consumer: they dream, they share; they shop, they share; they book, they share; and they travel and they share. Imagine the possibilities if you can figure out the precise degrees of convergence to meet and influence them at every one of those steps along the way. It paves the way for new and innovative ways to reach, influence and engage at all times.

Channels on Mobile Devices Expected to have the most dramatic influence on distribution, mobile is an absolute game changer. Every digital distribution channel will have a mobile presence and will be at the very center of all consumer online activity, making it a powerful platform of channel convergence. The mobile mindset needs to go beyond that of a device or provider of content but a platform where distribution channels, social networking, marketing services and customer relations converge.

As smartphone adoption approaches 50% of the mobile populationi, hotels need to tap into that with a mobile optimized website and a mobile-specific plan that embraces the notion of travel planning and engaging from anywhere. Consumers make at least $2.6 billion of travel bookings on their mobile



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devices aloneii. Your mobile site should be optimized with fresh, relevant, content, have local optimized listings on mobile directories, and offer geo-location services that reward guests for “checking in.” Encourage engagement with contests and sweepstakes via SMS and social sites, use mobile SEM and SEO, and facilitate mobile opt-ins from all of your marketing initiatives.

Designing a mobile strategy necessitates a “mobile first” perspective that considers what happens in social media across devices at any point in a consumer’s day. It should embrace a new design thinking driven by convergence to enhance the customer experience.

Mobile devices, coupled with social media, create a powerful shift in consumer behavior. With location-enabled phone in hand, social media enthusiasts share their experiences in real time and want instant and accurate access to information regardless of where they are. One of the most powerful ways to create meaningful experiences with target customers comes from the convergence of social, local and mobile (SoLoMo). It is an opportunity to deliver more personalized, relevant content and engage existing guests and potential customers like never before.

What makes SoLoMo so effective is the convergence of three key areas of a travel consumer’s psyche. Social satisfies the need to share travel memories and experiences, local taps into their expectation of relevant information from wherever they are, and mobile fulfills their need to be on the move. When in sync, the ability to satisfy their need for connection and engagement is at peak performance.

“The emergence of SoLoMo has allowed hoteliers to connect with their guests on a deeper, more meaningful level,” commented Amanda Webb, Director of Online Advertising and Media at Sabre Hospitality Solutions. “It’s very powerful for the consumer to interact with a brand on the platform of their choice and the brand to engage with the consumer at the point of influence. This bridges the gap and breaks down barriers with consumers so they can freely interact without feeling like they are being targeted with obtrusive marketing messages.”

Mobile can really drive the travel experience with guests utilizing features such as cameras and messaging, QR codes and augmented reality in order to enhance or extend their experience beyond their immediate surroundings. Social media campaigns can encourage guests to create and share user-generated content during their stay with photos and videos, or check in for deals and exclusive offerings. As a way to upsell ancillary services while guests are on property, utilize messaging to feature exclusive offers or upgrades that can be redeemed with the ease of a click or a call.

A single enterprise solution with better educated guest folios will allow property operations to analyze the on-property purchase behavior bringing impactful insight to both macro and micro marketing efforts.

Social Networking & Marketing Social networking has had the most profound effect on the digital marketing landscape. What once was a supporting role in the search and booking process, social networking, including the use of user generated review sites, has evolved into a highly credible, trusted and influential platform for



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information gathering and booking, rivaling hotel websites, search engines and OTAs. It is where suppliers can enhance guest experiences, manage relationships and fuel brand advocacy. Social sites like Facebook and YouTube, along with consumer review sites like TripAdvisor, allow a guest to feel like they are on property prior to arrival, setting expectations and building anticipation

You potentially have the most powerful customer engagement tool at your disposal when you:

converge all the tools, applications, platforms and channels that comprise social networking,

deliver the right message to the right customer at the right time, and

build on your customers’ profiles to understand them over time and their likely future behavior.

The rewards are limitless: branding, sales, referrals, reputation and exciting new marketing opportunities that are extremely personal.

Social media and mobile marketing, along with channel convergence and multi-channel marketing has made it more important than ever to track campaign effectiveness and optimize returns. Data intelligence is the key to making channels more effective by understanding each touchpoint’s contributions to bookings, branding and engagement. It allows hotels to gain greater insight into their customers’ behavior and improve channel interaction. Study the effectiveness and ROI of your digital marketing campaigns and make smarter use of analytics technology to determine ROI and campaign effectiveness. Google recently rolled out a multi-channel funnel that provides rich insight into property website conversion paths which has open eyes to just how many brand touchpoints are needed to influence a final conversion.

Go beyond traditional website analytical tools to track conversions from digital advertising campaigns, use call analytics to track voice calls, create individual landing pages for offers, QR codes and texts for specials. As you learn the source of your business, you can make smarter and more cost effective decisions. And with that in mind, when measuring results from social media marketing, look beyond revenue and consider its contributions as a brand building, customer service channel.

Social Media & Revenue Management Social media is dramatically impacting revenue management and the ability to optimize demand. The discipline has progressed from being tactically focused on inventory management to being highly customer-centric and driven by distribution and competitive pricing strategies. The convergence of revenue management and channel management is providing hotels with an outstanding opportunity to gain increased control over price, marketing and market share. Achieving that requires a distribution strategy with consistent pricing and branding across all search engine channels, and understanding how it impacts revenue management. The benefits of this integration are enhanced customer relationships, increased bookings and a better management of demand across all distribution channels.

Having a powerful revenue management presence across all social media channels is a must, from a booking widget, “book now” and best available rate to reputation management intelligence. Use social engagement metrics to know what is being said online and to assist in competitive benchmarking. Look



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to a review aggregator to analyze reviews, ratings, and other user-generated content to determine what types of customers are booking your hotel through each distribution channel, and the hotel’s position in relation to competitors on the same channel. Take that information and direct targeted marketing efforts to your brand advocates and watch how the message spreads.

Consumers are increasingly making booking decisions based on both reviews and rate, looking for the best value. Decisions based on ratings and price facilitate the need to pay closer attention to peer reviews. For example, if the average rating for one hotel is 4 versus 2 for another in the competitive set, but the price is the same, it is likely that the one with a higher ranking will win.

Get serious about tracking profitability by market segment. Know your value scores on websites like TripAdvisor to set pricing. With websites allowing guests to research by guestroom and others providing views from each room, pay attention to RevPAR by individual room-type and use this data to optimize consumer demand.

Content Across Channels Marketing to the on-demand consumer requires a multi-channel marketing approach that engages consumers at all touchpoints with rich, fresh, compelling, consistent and relevant content that displays well no matter the device they are using to browse. That requires managing what you show where, and how that displays over all devices, from mobile to the big screen.

“With nearly infinite device choices,” remarks Robert Dawson, Vice President, Internet Marketing & Web Development at Sabre Hospitality Solutions, “today’s websites need to be developed to render an accurate representation of the brand no matter the screen size. Right now the user is choosing a specific device, but with flexible screen technology already in production, it’s not long until the screen of the mobile device will have the adaptive ability to be unfolded and expanded into a uniquely different footprint. For example, there are mobile devices that are being developed that measure 4 inches in size in its default configuration that will have the ability to literally transform into a 12 inch device based on the users need.”

Today, these multi-channel users search all over for their travel needs. They want super quick responses, to be entertained, to give their opinion, engage and most importantly, they want relevant content. They are in total control of their consumption of media messages. Whatever their channel of choice, whether it’s mobile marketing search, social media, a hotel brand website, etc., you need to be there with tailored and engaging content relevant to each medium.

It is here that all channels must converge, from the hotel brand website to your social media presence, email and SEM campaigns, mobile initiatives and more. Imagine the day when a single website promotion will trigger a domino effect. Your entire social stratosphere (Facebook, Twitter and the like) will be alerted, your opt-in email list will get notified, it will populate your mobile website, a paid search campaign will kick in and so on. When these activities are centrally managed they will be distributed along multiple platforms to ensure consistent messaging across all channels to reach guests at every touchpoint.



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Content on Search Engines One of the greatest evolutions in search revolves around the diversity of content.

Content is converging in unimaginable ways as search results are yielding so much more than just websites – from guest reviews, articles, blogs, forums, photos, videos, social networking sites, OTAs, rates, availability and much more.

Google is changing its algorithms to incorporate social media traffic, and content is being pulled in from social networks in a live feed manner. The result is more and more prominence being given to quality content from social media sources and new influences on rankings.

As media and technology giants such as Google, Microsoft, Apple, Facebook and other meta-search channels become dominant and influential forces, hotels need to ensure all of the content is found on the web in a way that is consistent with the expectation of their users. That means getting in to the mindset of the customer and creating a content marketing strategy that identifies their process and behavior. Think about what format they want their information in and on what devices they will be accessing it. Identify the keywords, topics and media that interest them. Follow the path your customer takes and know which channels they use, when they use them, and how they use them so you can have a presence and create personalized transactions and guest experiences.



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Acknowledgements

About HSMAI The Hospitality Sales & Marketing Association International (HSMAI) is committed to growing business for hotels and their partners, and is the industry’s leading advocate for intelligent, sustainable hotel revenue growth. The association provides hotel professionals & their partners with tools, insights, and expertise to fuel sales, inspire marketing, and optimize revenue through programs such as HSMAI’s MEET, Adrian Awards, and Revenue Optimization Conference. HSMAI is an individual membership organization comprising more than 7,000 members worldwide, with 40 chapters in the Americas Region. www.hsmai.org

About Sabre Hospitality Solutions Sabre Hospitality Solutions provides innovative marketing, distribution and operations products and services to thousands of hotels around the world. Visit www.sabrehospitality.com to learn more about their CRS technology, Property Management System, Internet and social media marketing programs, award-winning Website designs, travel agency media, RFP tools and mobile solutions. The experts at Sabre Hospitality Solutions will create a plan that produces real results for your company.

For more information on Sabre Hospitality Solutions and its services, please visit www.sabrehospitality.com, call 1- 877-520-3646 or email [email protected]. Join us on Facebook and Twitter.

About the Author Taryn Schneider, president of Taryn Schneider Communications, has more than 28 years of hospitality, travel and tourism experience as a writer, editor and marketing communications specialist. She has worked on behalf of a select group of clients requiring highly specialized communications services, promotions, writing, publishing, and special events. She began her career as a writer and editor for Travel Agent Magazine, and spent the next decade working in a diverse range of travel publishing, television producing, and journalistic endeavors. Her articles have appeared in both travel consumer and trade publications.

i http://snaphop.com/2012-mobile-marketing-statistics/ ii http://snaphop.com/2012-mobile-marketing-statistics/

http://www.facebook.com/SabreHospitality

https://twitter.com/#!/SabreTN

http://snaphop.com/2012-mobile-marketing-statistics/

http://snaphop.com/2012-mobile-marketing-statistics/

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s3.amazonaws.com...the center, and delivering relevant content, commerce and service is the key to delivering on the new reality. That means identifying how to optimize processes,