Friday, 3 June 2016

Driving down the cost of distribution

There were several insightful seminars at the recent National Hotel Marketing Conference, one of which was on distribution costs and ways to reduce them. Here’s some ideas that were gleamed from the conference that might help you drive down distribution costs:
  •    Review your agreement with the OTAs and look at your commercial terms, are there any other costs to consider other than just their commissions?
  •     Have regular account manager reviews with your channel partner – how do you compare to the local competition on these channels, is there anything more you can be doing to enhance your profile and drive bookings? What’s the latest trends and research pointing at?
  •   Do you know what your cost of acquisition is? Manage and review your revenue streams by cost of sale and from where they were derived.
  •   Review your channel roster and number of partners you’re currently working with – you might be able to work more effectively with a smaller number so it might be an idea to condense and focus on fewer partners?
  •   Develop a bespoke strategy per OTA – look at sales, availability, costs, if/when you need to hold back inventory.
  •   What are you doing to drive direct bookings on your website when a prospective guest clicks onto your website to conduct further research [after initially finding you on an OTA]? Tools such as Guestline’s Price Assure module will help reassure guests they are getting the best rate direct when comparing room rates and thus boost direct bookings.
  •   Have a direct booking strategy – use the channels as a marketing tool and have a plan in place to secure and drive return bookings direct. Make sure you capture data from the guests whilst they are staying with you and develop a marketing plan to promote direct bookings (and other initiatives, such as reviews) post-stay.
  •   For example, develop a ‘Win back’ campaign using automated templates in your PMS to drive repeat, direct business.
  •   Think Social – think of your platforms and the audience. Launch a ‘Share & Like’ programme and ensure you provide updates on what’s happening in the area – don’t always focus on the sale. Have a Top 10 of things to see, do, eat etc. Think of enhancing the guests’ experience and providing them with inspirational ideas.

Hopefully these ideas will get you thinking and assessing your costs and routes to market. If you’d like any further information or assistance on revenue management, Guestline have a range of consultancy services; more details of which can be found here.


Thanks for reading! 

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