The hotel industry is being devastated by the COVID-19 virus. Social distancing and group size limitation, along with the unprecedented closing of major hotels across the world — the shuttering of 440 licensed casinos and the shutdown of the Las Vegas strip for the first time in nearly 60 years is only one example of the rush to prevent the virus from spreading.
Contributed by Robert Post, CEO of Knowland in Arlington, Virginia.
The reality is that it’s going to get worse before it gets better. However, we believe that now is the time to rise above the doom and gloom and focus on what we can do to help hotels survive and prosper in the eventual rebound. There will be a recovery period, and it is more essential than ever before that we stay calm and prepare for local, smaller business.
We are seeing group business take a big hit as U.S. group cancellation rates continue to rise – 40% for the 90- to 120-day booking window (as of March 11). For the week ending March 7, overall U.S. RevPAR was down 11.6% while group RevPAR was down 17.7% in this time period, according to STR.
In the global markets that Knowland tracks, 114 of the 179 were down. What does that mean for your hotel? We’ve compiled three tips we hope will provide some insights to help sustain your hotel business in the coming months.
Pivot your sales team from cancellations to new business development: Don’t sacrifice the long term for short-term savings – maintain your sales team to preserve revenue in the long term. Move past cancellations and put some of your team on building a new business pipeline and increase that focus over the coming weeks. Monitor your cancellations. At the point they slow down, launch your local sales blitz using email and phone campaigns (chances are you won’t be able to visit in person yet.)
Think strategically, act locally: Stop waiting on RFPs and start working your market proactively. RFPs will dry up if they haven’t already, so be prepared to deploy your sales team to work the small, local opportunities that will come back first. Identify all local offices and understand what business they have held in your market in the past. Look to better understand your feeder markets and how those could play into your local offices, then prioritize those leads on their propensity to buy from your hotel.
Develop relationships: As you make calls, don’t ask for business – ask how you can help; focus on building a partnership. It’s important to be creative about how you bring people back – open houses, tastings, etc. Then stay in touch by developing a regular cadence of communication to help maintain and grow the relationship. Offer live streaming meeting options. Partner with technology providers to create virtual meeting environments that are interactive and safe by bringing in remote attendees or speakers using Skype or Zoom applications. Focus on what your hotel has done to prepare, such as sanitation stations for guests, enhanced housekeeping sanitizing processes and staff preparedness and health/hygiene practices.
By focusing on building your local and regional pipeline, your recovery will happen faster as you are ready to capture pent up demand and have developed the relationships to do so as it starts to emerge in local markets first.
For information on how the Knowland platform can help to navigate today’s environment, click here.
