SFA Riches

In this article…

Marketing and Selling to FITs

Selling to Groups and Meeting Planners

Channel Management

Relationships

Automated Response or Manual?

Sales Force Automation

Customer Relationship Management

Keep It Clean

So Where Are We?

An Embarrassment of Riches

A review of the current state of sales and marketing tools, and coping with the almost overwhelming amount of information they produce.

Recent strides in technology have provided hospitality sales and marketing professionals with a remarkably capable selection of tools, with the potential to make their work much more efficient and more comprehensive. But the ever-increasing tide of changes, the tsunami of information and e-mails that threatens to swamp our in-boxes every day, and the less-than-perfect interaction between all these new “helpers”, often produce the helpless feeling of being overwhelmed.

Paradoxically, it’s simultaneously almost too much of a good thing, and yet not quite enough. Most of these tools individually have very definite, significant advantages for their users. Just as often, however, they’re also a step or two short of the level of seamless integration with others that would vault them into true, effortless usability. And they take time and a technology focus to make the full use of their benefits and overcome their shortcomings.

The technology buzzword today is “integration”, but it’s still an incomplete science. True, we’re seeing much more linking between devices: PCs to PDAs, PDAs to cell-phones, all of them to the Internet. But despite numerous efforts to set data-exchange standards there are still too many disconnects between the software systems. Sales Force Automation doesn’t always talk to Sales & Catering, Convention & Visitors Bureau systems don’t talk to hotel Property Management Systems, and everyone and his brother is offering “a new distribution channel of strategic importance to your business” – which has to be managed separately because it doesn’t talk to any of the others.

All of which makes it more imperative than ever not to lose sight of the fundamental truth of selling – no matter what tools you use, it’s all about relationships.

Let’s take a look at some of these developments, focusing on three general areas:

  • Marketing and Selling the property to individual, transient guests (FITS)
  • Working with Groups and Meeting Planners
  • Sales Force Automation systems, the main tool both areas use to manage their teams.

Marketing and Selling to FITs

Interactive advertising – which is what a bookable Web page really is – is a major convenience for the traveler, saving time and providing access to far more information than they’d get on a printed page. It’s also been a bonus to the property as an additional low-cost distribution channel for accepting reservations, though it’s important to remember that it’s the per-transaction cost that’s low; the cost of building and maintaining an effective reservations-taking Website has grown enormously as customers have become more sophisticated in using the Internet.

The next step in Internet reservations complicated things, however, though much more for the properties than for the traveler. More and more intermediary Websites have sprung up – independents such as Travelocity, HRN, Travelweb, Expedia, WorldRes, etc., not to mention the chains’ corporate sites – each wanting to offer multiple properties’ inventory to specific markets, and it seems more come on line every hour. As a result, both properties and potential customers have become faced with “the tyranny of choice”; there are now too many options.

Travelers can handle this using Internet search engines to look through multiple sites to find a list of suitable offerings, though there’s always the sneaking feeling that perhaps a different search engine might find a better deal on another site… For the properties, however, the issue of which sites to list themselves on, and how much inventory to allocate there and at what rates, has become a major headache. You don’t want to miss out on a potentially valuable new group of customers, but it’s almost impossible to know up front which new sites will turn out to be productive sources of business. And since almost all sites require you to allocate specific inventory to them, there’s a limit on how many you can manage – and it’s a small number.

To resolve this, of course, you need a single source of inventory information that all Internet sites can access. Some intermediate sites (such as SynXis) offer to do this, acting as your source for all other Internet booking sites (and also providing links to the GDSs), but you still have to manage the inventory you post to that one site – and, of course, there’s a fee for every reservation handled. The better solution is to have an Internet reservations interface on your property management system, so that each Website you’re listed on looks at the same inventory: the master list in your own PMS. Many PMS vendors (including Fidelio, Northwind, Springer-Miller, Visual One, ICSS, etc.) now have these interfaces, some initially using just a manually-allocated block of rooms and rates but increasingly with direct access to the full property availability.

Unrestricted full availability carries its own dangers, of course. What really makes it all come together is the combination of an Internet reservations interface with comprehensive rate management features built-in to the PMS to impose automatic limits on your discounted rates. Ideally a fully-featured PMS would let you offer different rates and availability to inquiries from different Internet sites, automatically. And the obvious next step would be to tie this in to the PMS’ Guest History module, so that the system could check to see how often an inquiring traveler had stayed with you before, what her total average expenditure was per visit, whether she usually came during low or high occupancy periods – and then offer rates and availability that make sense for this particular stay. Channel management and one-to-one marketing at their best.

Clearly this requires a level of sophistication in systems and data collection that not many properties have today, but it’s also an example of the threshold effect. This is where automating several different areas improves the performance of each noticeably, but automating that last, integrated step between the systems pushes the performance of all of them over the threshold, and makes life far simpler and more efficient throughout.

Selling to Groups and Meeting Planners

The FIT scenarios also serve as a background to the current hot area of interest, Internet bookings for groups and meeting planners. Groups are a fairly logical extension of the FIT situation, especially if they’ve stayed with you before, since your PMS can recognize them and respond with appropriate rates and availability information. In fact, it’s possible to customize your Website to allow for password-protected entry by valued group clients, which then gives them direct access to specific rates and availability.

This has been taken further by convention-booking systems such as Passkey, b-there.com and Wintrack. These allow conventions to set up a Website for a multi-property event, with each hotel allocating (and managing) its own room block and rates, and with the convention planners and attendees given appropriate access codes to allow them to pick up room reservations and enter their rooming lists themselves. This is a tremendous improvement in efficiency, with each party taking care of that part of the transaction it’s best equipped to handle and all benefiting from the result. The next stage, clearly, is to integrate these systems with both the hotels’ property management systems and with the Convention and Visitors’ Bureaus own sales systems – and that will come, in time.

On-line meeting room booking, on the other hand, can be fiendishly difficult, due to the number of parameters that define the right combination of rooms for any but the simplest functions. After all, trying to make a reservation for a 25-person boardroom meeting means finding a room big enough for that configuration but small enough that the group won’t feel lost in one corner, and that isn’t near a noisy event or one held by a competitor’s company. Ideally it’s also already booked for another group before or after the time slot requested with the same room configuration, to minimize set-up/break-down time. Add in a need for a lunch room and two break-out rooms on the same floor, and you can understand why most meeting planning sites just take the details of the function and send them to the property for a manual response.

This is not to say that automated Request-For-Proposal (RFP) handling doesn’t have its place, as witness the rapid growth of Internet sites handling this very function, such as PlanSoft, StarCite, HotDatesHotRates and any more. All of these perform valuable functions in collecting a meeting planner’s requirements and distributing them to a wide selection of properties in the preferred area that have function rooms of the requested size, even if they don’t know their actual availability for the dates in question.

In addition, automated-response applications (such as Lanyon’s RFP Assist) can analyze these incoming requests – all of which seem to be in different formats, despite various industry efforts to come up with a standard – work out which standard pieces of information about the property can be filled in automatically and forward the result to a Sales Manager to check availability and respond to the client as quickly as possible.

Newmarket Software has been successful in signing up many of the meeting-planning sites to interface with its MeetingBroker product, which translates the RFPs into a standard action item with Newmarket’s Delphi and Breeze products. Other Sales & Catering systems vendors such as Daylight, Visual One and Hodges Technologies are working with the Open Travel Alliance (OTA) standards group on TWOMS, a Two-Way Open Meeting Specification covering similar functions. But there are so many factors to taken into account for the typical booking that it still takes a human, and an experienced one at that, to work out the best way to accommodate the request for the maximum benefit of both the client and the property.

Channel Management

Three other technology-related trends are noticeable in channel management. One is the spread of corporate-mandated travel policies, which, through the use of Intranet-based travel booking and expense-reporting systems, limit the airline, car hire and hotel choices available to their staff. While this does provide significant discounts and administrative savings to the company, it also restricts the opportunities for independent properties to sell direct to them. This in turn suggests that independents must band together more closely, and with more effective booking systems, if they are to attract big-corporation business.
A second trend is that as hotels make increasing use of technology for revenue management, they are becoming far less generous in the number of negotiated rates and discounts they offer to corporations, since their own Sales Managers now have much greater knowledge of what constitutes good business. This emphasizes the leverage you get from capturing and analyzing as much data as you can on your business patterns. While a company may request a significant discount for a single or series of bookings, if you know how well that fits into the type of business you can rely on over the same period you’re negotiating from a far stronger position.

Finally, Travel Agents are still surviving despite the competition from Internet-based booking sites, as they continue to fulfill a need for real opinions and real customer service. Internet sites, even those offering multiple properties and expert reviews, are still seen as mostly advertising; everything offered or said is out there for a reason. Many travelers still find that there’s no substitute for the opinion of someone they trust who’s experienced what they’re looking for.

Relationships

Which in itself is a highly important point. When companies use the growing number of meeting planning sites – or even e-mail – to send out RFPs to far more properties than would have been practical manually, how does an individual property respond to the potential flood of inquiries? What will make the Sales Manager treat one as a high priority rather than another? Conversely, when the meeting planner receives a stream of RFP responses, which ones will they pick to look at first?

It all comes down to Relationships; people will respond first to messages from people they know and trust, and will feel they can safely ignore the rest. Selling is still fundamentally and inescapably a relationship-based business. No matter how much automation you build into the process to make it more efficient, you still have to build relationships by talking with people one-on-one. What the tools do let you do is maintain many more high-quality relationships at once, and manage them from wherever you happen to be traveling at the time. In an age of ever-increasing complexity and confusion, dealing with people you trust is a life-saver.

Automated Response or Manual?

Over time, meeting requests will tend to separate into two groups. The more complex functions will still need to be handled through discussion and negotiation, as discussed above, but it will increasingly become normal for the more straightforward requirements to be handled automatically. There’s no reason why a request for a simple room for a 20-person half-day presentation couldn’t be handled directly by Internet access; AllMeetings.com, for example, focuses on simple meetings required by large corporations at short notice, although at this time it can only access last-minute meeting room inventory set aside manually by the hotels. It should be relatively simple, though, to extend that to a sub-set of rooms in an S&C system.
One other area that could be well come to the fore is the use of fuzzy logic to suggest alternatives to potential clients.

AllMeetings, again, given the cities from which various meeting attendees would be traveling, already analyzes air fares, hotel costs and meeting room charges and suggests alternative cities where the meeting could be held at lower cost. It’s a small stretch conceptually, given modern levels of processing power in our hardware, to imagine a situation where a future RFP-response system could suggest alternative dates on which the meeting could be held if the requested period is unavailable, or on which it would be cheaper. It’s the threshold effect again; an integrated combination of meeting-planning Websites, property-level Sales & Catering systems and Revenue Management would be a powerful mix.

Sales Force Automation

Sales Force Automation (SFA) systems have increased in power tremendously in the past few years, and are now truly indispensable. Most sales offices have used some form of SFA for many years to handle the fundamentals of contact and account management, either with a generic third party system (such as Act!, GoldMine or SalesLogix) or a hospitality-specific system such as Newmarket’s Delphi SFA or Visual One’s SFA (formerly Miracle). But even what used to be thought of as entry-level systems have become remarkably full-featured, and can be powerful tools for any sales organization.

They still provide account management, of course, but now also help you find new leads and share information with colleagues, let you know your customers better (by pulling information from both internal and external data sources, including financial data, stock prices and news that mentions your client’s company), and allow you to create personalized, customer-accessible Web pages. Importantly for the ever-mobile Sales Managers, you can get to the most current data, both on your clients and on your property’s availability, from anywhere via laptops, Web-enabled PDAs and, in the future, WAP-technology cell-phones. Mobility is a given these days; cell-phones, organizers and laptops ARE the current office, and there’s no longer any real need for sales staff to be based on site.

Tying SFA in with Web portals gives your sales staff weather look-ups, FedEx shipping label generators, on-line credit reports, maps/driving directions, access to the Yellow Pages, etc., not to mention letting them file their expense reports over the company Intranet. And by automating alerts for scheduled or ad hoc action items, and letting the system handle recurring tasks such as follow-up e-mails and report generation for management, less time need be spent on routine administration and less is likely to be overlooked. Asking your staff to function efficiently without these tools is clearly akin to cruel and unusual punishment, and will certainly put them at a significant disadvantage.

Several systems (including Act!) now include prospecting software, using an online service to find companies within your territory similar to your existing high-value clients, and then downloading contact and business information about them. GoldMine can also create contact records directly from data entered into a form on your Website by a potential client looking for information. Opportunity management, sales forecasting tools and report generators/data exporters now come built in. Even in small companies, the trend towards sharing information will continue, reflecting the ever-changing nature of the sales process and the salesperson’s now-accepted role as a member of a skilled team, not as someone whose value lies only in their jealously-guarded contact lists and customer information.

At one end of the scale, some larger hospitality companies are beginning to implement more sophisticated general-purpose systems such as SalesLogix or even Siebel, the 600-lb gorilla of the high-end SFA industry. Despite these systems’ need for expensive customization before implementation, Marriott and Starwood are both using Siebel for their National Sales Offices, which have a more generic nationwide, multi-location account management requirement than the more hospitality-specific property sales teams. Integration with the hotel-level systems such as Delphi, Fidelio, Daylight or Visual One has yet to be proven, however.

At the other end, we see the arrival of purely Web-based SFA tools from Application Service Providers such as salesforce.com and upshot.com, which have been gaining good reviews lately in comparisons with the smaller general purpose systems. As with other ASP offerings, they’re easy to implement and administer; there’s no upfront investment in software, they’re accessible from any browser so there’s nothing to load on users’ PCs, and they synchronize well with Outlook or PDAs. But they also have the other characteristics of ASP products; many clients are cautious about keeping customer information on the Web, integration with other applications may not be as tight, and you must have a Service-Level Agreement that guarantees very high uptime. The jury’s still out on ASPs for client-critical applications in general, but if you need an SFA in a hurry, these may be a good solution for you.

Customer Relationship Management

The general-purpose SFA systems are beginning to include some of the functions of Customer Relationship Management (CRM) solutions, interacting with other divisions for a more complete picture of a client’s experiences with a company. Even low-end systems are in on the trend; GoldMine now positions itself as a CRM supplier, having bought BenData and its Heat help desk product, though the level of integration between the products is not yet proven. The advantage of CRM functionality, of course, is that the Sales Managers can be kept more up to date with any problems an existing customer is having, and don’t get blind-sided and yelled at when they call.

There’s an enormous gain in credibility if your Sales Managers are clearly and properly up to date with the client’s experiences. We’re not there yet, but the SFA tools are ready to handle the input if we can get it to them from our somewhat insular hospitality systems.

The more capable of all of these systems can be quite expensive, especially with CRM, and a dollar-based ROI is not always easy to define. Nonetheless, often making things flow more smoothly and removing headaches is justification enough for the purchase.

Keep It Clean

Even if you don’t go for a full CRM system, you’ll certainly be keeping a significantly large database of your corporate and FIT clients’ business with your property for reference. The information you can find from these records is tremendously valuable in giving you insights to your clients’ business patterns – when they book, how far out, their typical total expenditure, average wash percentages, and so on. But this information is only valuable if the underlying facts are accurate; database management is a vitally important task, since obsolete information is useless.

One estimate says that in any one year 20% of the US population changes their address – and that’s just mailing addresses. E-mail addresses can change even more frequently, and they require an even higher standard of accuracy. After all, the mail service will usually deliver a letter correctly even with a few typos in the address, but an e-mail address with one wrong character is history. It’s a hard grind, but keeping your data up-to-date is vital, through measures such as checking addresses through the NCOA register, making sure you verify important data with the client regularly, identifying and merging duplicate client records, and so on.

And be targeted and wary in your use of this client data; it’s just as important to know who NOT to market to as who to contact. Treat your clients’ information with respect; when they give you information about themselves, or you collect and remember it from previous stays, using it to make their next encounter with your property more personal and meaningful is courtesy. Bombarding them with unrelenting and possibly unrelated information is an invasion of privacy. It’s often really hard to tell when a line’s been crossed with an individual customer; what’s acceptable to one may be highly intrusive to another.

So Where Are We?

In possession of powerful tools and access to information that our predecessors could only dream of – yet needing to make harder choices about what we focus on, for fear of being overwhelmed. Able to work far more efficiently in separate areas – but still on the threshold of true, standardized, seamless integration that really pulls it all together. The next couple of years will be pretty interesting, technologically. But it will still be All About Relationships.

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© Jon Inge

First published Fall 2000, Hospitality Upgrade magazine

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