HOSPA Masterclass - 10th March 2021 

Preparing For the Staycation Rush

 

With statistics, market insight and trends shared presented by Agnieszka Wojciechowska from Hotstats, Samantha Williams from Profitroom and Lloyd Brock from St Michaels Resort - this should be all you need to ensure you are ready to maximise the demand from within the UK. 

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ATTENDEES

• (JP) Jane Pendlebury - CEO, HOSPA

• Samantha Williams - Market Lead, Profitroom 

• Agnieszka Wojciechowska - Director of Hotel Intelligence EMEA, Hotstats

• Lloyd Brock - Digital Marketing Manager, St Michaels Resort

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Agenda

00:00 Introductions 

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[0:12] JP: Good morning and welcome. Thank you for registering for today’s masterclass, which is all about preparing for the staycation rush. Thankfully we now have a plan for coming out of the third national lockdown in the UK, with most hotels opening in May, some in June this year. We’re still restricted on international travel, and this has meant that British hotels have seen a surge in booking requests. We’re here today with Profitroom and Hot Stats who will both share some amazing stats and figures, and we will be delighted to hear from the horse’s mouth, beautiful Michael’s Resort in Cornwall. 

There is a feeling of optimism in the UK, despite today’s rain, although not in Scotland I hear, and explosive headlines about the royal family. My name is Jane Pendlebury, I am the CEO of HOSPA. I’m delighted to be joined by Samantha Williams from Profitroom, Agnieszca Wojciechowska from HotStats and Lloyd Brock from St Michaels Resort in Falmouth. Thank you for joining us.

 

We’re going to start with some poll questions:

 

When do you feel the market demand will be back to pre-covid levels?

If you can select one of the following: quarter two, quarter three, quarter four this year or twenty twenty-two or beyond. So it’s looking much better for next year, although there’s a little bit of optimism there for quarter three in twenty twenty-one. I must say, a lot of the webinars that I’ve been on recently have indicated that we’re looking at twenty twenty-three, possibly twenty twenty-four and even beyond that.

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Just another quick one, have you booked a holiday in the UK this year?

Yes, no, or thinking about it? There you go, you can see the results there. So, that is actually not what I expected to see. Most people I have spoken to have already booked their holidays. So, over half of you haven’t, but a quarter has, so that’s interesting. 

 

The final one, just for this little batch of questions: 

 

Will you be looking to holiday in the UK or abroad in 2022?

This one probably won’t surprise anyone. So, yeah I think we all want that guaranteed sunshine that we get from an overseas holiday, so that’s great, thank you all very much for taking part in that. I will now hand over to Aggie from HotStats, who is going to be sharing some benchmarking stats that will help all of us plan with confidence for the coming season. Aggie, over to you.

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[4:30] (AW): Thank you very much, and welcome everyone. My name is Aggie, I’m a director of hotelier intelligence at HotStats. HotStats is a P&L benchmarking platform. We deliver the data that we collect from the industry in the way of internal and external benchmarking as well as market insights that we provide for the hoteliers. 

 

Today we are going to discuss an overview of recovery and how it is all looking in various parts of the world, and how it’s comparing with [xxxx]. I’ll be mentioning three key trends that we’re seeing now in the hospitality industry, and how they can become an opportunity for hoteliers. 

First of all, like I mentioned, this is a graph showing GOP performance year-on-year for various parts of the world. What you can see quite clearly now is that China is in the V shape recovery and that’s a region that’s coming back to the pre-covid levels, they’re not quite there yet and they have not really achieved one hundred per cent of what it was before the pandemic, however, they got very close. Another region that is obviously worth looking at at the moment is the Middle East. So the Middle East is also recovering, with restrictions certainly lifted there and with the holiday season/peak season being in that region, occupancy has been getting back to sixty to seventy per cent in the recent month. Unfortunately, Europe is not looking so positive with the second or third lockdown, with the second wave of covid as well. We can see that obviously, the situation in Europe is a little bit more dire.

What I’ll also be talking about is three trends that we can use in the hotel industry at the moment. The first one is looking at the TRevPAR. TRevPAR is one of the main KPIs - not only looking at the RevPAR of the hotels but actually looking at the total and the full picture, the full revenue mix. In general, we pay a lot of attention to RevPAR as hoteliers, but also I would like to show you here, in this picture, that at the moment, globally (these are twenty twenty figures), rooms revenue was about 60% of the revenue mix of hotels on a global basis. In some regions, for example, the Middle East, the rooms revenue was only 50%. So, obviously, with the times, we are in right now, it is important that we do have a look at the full picture and consider all revenue streams in a hotel.

 

With the revenue performance for other streams, so these are other streams apart from rooms revenue, so F&B revenue, conference and banqueting room hire, spa and leisure revenue, you can see on the slide that they have decreased very significantly in 2020, and they had taken a very hard hit last year. This is predominantly important for asset classes like full-service hotels and obviously the luxury segment that’s been hit the most during the pandemic, and they have experienced really long periods of negative GOP for available rooms, really difficult times for these asset classes and you can see here that’s showing as well on the slide in terms of the revenue performance. 

However, if you look at the next slide, what I wanted to show is the F&B performance per occupied room basis. So this is taking into consideration [xxxxx] guests staying in the hotel room, and what we can see is that, in certain regions, even though they have started recovery in [xxxx] the Middle East, there is still a lot of F&B revenue that is not coming from the lack of demand, but also the fact that all these countries, and ours as well, have had to implement social distancing rules in both bars and restaurants, and we can see that already on this graph. Another story here is the rooms service revenues. So this is another area that was historically dismissed by hoteliers, however here, in regions globally, we have noticed that this is the revenue stream that has increased, in particular in the Middle East, and it has actually become an opportunity for hoteliers during the pandemic.

So, as a summary, like I mentioned, it’s really important to look at TRevPAR as a whole and look at all of the revenue streams we’ve got available, and we can create in the hotel. We want to really creatively utilise the space that we have because of the lack of demand that we are facing at the moment in the industry, and building up packages that will increase our TRevPAR, and also in turn our profitability. It’s another opportunity that we’ve got here in the hotel industry. Another thing is also the C&B events, weddings, conferences and so on - there’s a lot of business that didn’t happen this year, that is not going to happen in twenty twenty-one, so obviously, that’s another opportunity for hoteliers, for the coming period, probably next year to take advantage of all these events being postponed.

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Another trend that we are seeing, is like Jane already mentioned, we are now preparing for the summer rush, and most likely a very busy summer that we are going to have this year in the UK. Like I mentioned, the demand in Europe and UK is definitely leisure driven. This is the segment that has been relatively resilient during the pandemic. In other regions of the world that are recovering, we can see the return of other segments like conferences or corporate business, however, that’s not the case for Europe or the UK yet. So if you look at the next slide, this is a comparison of the performance of the key cities in the UK versus the south coast. We can see that big cities have been significantly affected during the crisis, and the majority of them have faced overall negative GOP again in twenty twenty. If you look at the picture on the right from January twenty twenty one that looks even more dire. However what happens is that properties on the south coast have out-performed the key cities in the UK, and this is something we can see much more clearly on the next slide.

 

We’re comparing the key cities again (the grey line), and that’s GOP for the UK. In comparison with the south coast and UK resorts, places like Dorset, Somerset, had performed much better last year, and what we can see as well that in terms of that profitability and also TRevPar, what happened is they’ve managed to, during the summer period, achieve even better and higher performance than it was before the crisis because obviously the moment the restrictions lifted, the demand returned and people really wanted to book holidays, so this is something we’re now expecting in the summer period.

So as a summary, we’re most likely heading towards a very busy summer which we’re obviously very happy about, the only [xxxx] here is that although the hotels might be busy and have very high occupancy, the thing to remember is that we need to prepare how we can mitigate problems that may come from… or loss of revenue that comes from the social distancing measures that we need to implement in the industry.

 

And the final trend is the profitability of the hotels. So we’ve been talking quite a bit in the industry, in the sector, about if we’re going to open [leaner?] hotels in the future. So obviously costs have been a very big topic that we’ve been discussing in the industry, and if you see on the next slide, what we’re going to start with in terms of how profitability has been affected is the increased cost of operating. So this is something we’ve been monitoring here at HotStats, because we’ve been looking at how the pandemic has been affecting [the costs line?] of the hotel. This slide is for Europe, but it has been exactly the same trend in other regions - the Asia Pacific, the Middle East and so on, we’ve seen the trend globally. And what happened is that on the per occupied room basis, we saw a spike in the cost of operating the property, and costs included here are predominantly room supplies or cost of cleaning bedrooms, room servicing and so on. So we saw, for four or five months, a spike in these costs. However, this has now stabilised and returned to the pre-crisis levels.

On the next slide, we’ve got undistributed departments. We had a closer look also at overheads, at what’s been happening across the world and how this compares with Europe. So obviously, in general, in undistributed departments there’s been a lot of unprecedented reduction in costs that we’ve faced in the last ten months or so in the whole industry. The range is depending on department region thirty to fifty percent on average. However, if you look at sales and marketing spent, that’s been affected the most out of all the industry departments, fifty to seventy percent drop year-on-year. 

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This is predominantly linked with the marketing fee that hoteliers pay, and that fee is linked with revenue, but definitely something to have a look at. Another thing here is that obviously it’s been a really big trend to implement zero-based budgeting, and hotels in the current circumstances have been scrutinising each and every expense that they had in their hotels with the view of whether this is something they’re going to carry forward or not.

 

On the next slide is an analysis of the biggest cost that we’ve got in a hotel, and that’s obviously payroll. This analysis also relates to undistributed departments, and how the payroll cost structure has been evolving. That’s why we were mentioning China and the Middle East at the beginning, as regions that are recovering. What we’re showing here is that even though the regions are getting back to operation levels almost at the same level as before covid, definitely when it comes to payroll costs, that’s not the case. For [xxxx] at the moment, the levels of overheads and the labour costs in overheads is about ten to fifteen per cent lower than what it was before covid. In the Middle East, we can see these reductions or forty to sixty percent on the per available room basis, this is quite significant and again, even though the region is recovering, obviously want we want to see is how this is going to happen in Europe, at the moment we are not really able to see and have a full picture because obviously of all the Furlough and government support that the hotels have been receiving.

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The final point here is this trend is obviously breakeven. This is again something that we’ve been discussing quite a bit, it was a big decision at some point during the pandemic for a lot of hoteliers - shall we close or shall we open? We’ve been monitoring the occupancy levels that are required for a hotel to open or to be profitable, or to breakeven, rather. Before the pandemic, on average, and obviously this depends again on the region and the assets class, but on average it was about thirty-five per cent occupancy level. This number definitely decreased during the crisis. Here on the right, you have the last three months of twenty twenty, and if you look at regions like Europe and the US, the breakeven point is much lower. Again there are too many factors here to cut down the costs but also, obviously the government help that we’ve been receiving in the industry, with other regions like the Asia Pacific or the Middle East where maybe they have not managed to get the breakeven point as low as we have here in Europe.

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So, like I said, there is a lot of evidence that we might be opening leaner hotels in the future and a lot of evidence pointing towards payroll. So we might be seeing a few changes in the P&L make up like I mentioned - a lot of hoteliers are getting back to the zero-based budgeting so that they can have an impact and really understand the cost structures of the hotels and see if they’d have to return to the same structure in future months or years. At the same time, it’s really difficult to look at the data on a year-on-year basis and compare it with what happened in two thousand and nineteen. That’s why it’s really valuable now to have a look at your KPIs, have a look at your performance, and how you’re performing versus competitors, and also utilise this opportunity in benchmarking to see how various cost lines and departments will affect the profitability of your property.

 

(JP): Right, that’s great Aggie, thank you very much, some really useful things there, and I’ve already got some questions and comments coming in about those, but let’s save some of those until the end, and go just quickly onto our next quick poll, which will lead us nicely into Samantha’s presentation.

 

So, the question is now on your screen: Do you feel you have the right revenue and marketing strategies in place to maximise demand for your property? So that’s a straight yes or no answer. The swing on this is quite significant, actually. I’m just about to close the poll so if you haven’t voted already, please do so now. There are the results of this one, it was changing quite significantly as it went through. Thanks, Aggie, for that, that was really useful. Sam, can you tell us just a little bit about Profitroom and share some of your findings to give our listeners today the insights they need to maximise demands this summer? I’ll leave you to introduce Lloyd, as well at the relevant point if that’s ok?

 

(SW): Yes, absolutely. Firstly, thank you, Aggie, you’ve set the scene really nicely for the second part of this masterclass. At Profitroom, we work almost exclusively with leisure businesses, hotels, resorts and service departments, and we can see here how we enable them to have more profit. So, everything we do is exactly like HotStats, is to empower hoteliers to have more increased and profitable revenue from their online streams as well. First of all, we have our technology, and second of all services, which really support our technology and provide overarching strategies for our clients. 

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Moving onto what we’re going to talk about today, so here’s the agenda. First of all ‘The Surge’, and this is around the whole point of today’s webinar, the trends that we’re seeing. Customer confidence and how it’s being gained, how to package online offers and how to optimise those, and lastly guest loyalty.

First of all, though, it really is a pleasure to be joined by Lloyd today. We’ve been working with Lloyd and the team at St Michael’s Resort for around six months now, Lloyd. So it would be great for you to introduce yourself and the resort.

 

(LB): Hi everyone, thank you, Sam. Lloyd Brock from St Michael’s Resort, digital marketing manager. We’re based on the south coast in Falmouth, so we feel incredibly lucky to have had such a bumper summer last year, and already it’s looking like so far in twenty twenty-one is going to follow the same patterns.

 

(SW): Thanks, Lloyd. It’s really interesting actually, Jane, you asked us to talk about the experience we’re having at Profitroom because we work almost exclusively in the leisure industry, a lot of our statistics are really positive, and that’s because of the leisure boom. So, Aggie has already mentioned how leisure is leading the demand. So Lloyd, perhaps you can just explain how your business has changed over the last year because actually, you’re having record-breaking months in terms of revenue generated.

 

(LB): Yes, it’s been a strange year for everyone in hospitality. We made the decision to keep our marketing team relatively intact during the first lockdown, and we made the focus to improve our systems. One of the predictors we had was that we may have to reduce our reservations capacity, so we knew that taking online bookings was going to be [xxxxxxxx] in [xxxxx] the current climate, so we looked at our booking engine and we saw that although mobile traffic was going up year-on-year [xxxxxxxx] per cent of our traffic was coming from mobile devices. Actually, our conversion rates on mobile were getting lower. So we looked around at different booking engines to see which one had the best offering for us, so we went with Profitroom on that, and we were lucky enough to get the booking engine transferred over to us just in time for the boom again for the end of July. So we’ve gone from seeing a twenty per cent booking from mobile devices up to seeing fifty-fifty split between mobile and desktop. So for us, it’s been really useful.

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[25:10] (SW): Thanks, Lloyd, it’s great to see that there and, it goes without saying we’re really enjoying our partnership together. 

So the first topic we’re going to talk about is The Surge. Again, everything we’re going to talk about today really is a deeper insight into the leisure demand, so please do bear that in mind when we present the data. The first one here to talk about is website traffic. Now website traffic is probably the first indicator for a hotel, the first chance they have to respond to market demand. We can see here, so the data that we’re presenting today is for this year, so it runs from the first of January through to the eighth of March. We can see in orange sessions, so the light orange is sessions from last year, and the darker orange is sessions from this year. The blue lines across actually represent conversion. So we can see the lighter blue line at the bottom is the conversion from last year, and the blue line floating at the top is website conversions from this year. We can see almost an instant increase there as well, probably generated from the Prime Minister’s talks. We noticed, actually, that every time there’s a big announcement from the Prime Minister, it really does influence direct bookings, and we can see that in this chart here. Something that is worth noting, though; so traffic so far hasn’t yet surpassed traffic from last year. And what we’re seeing is that actually, the percentage of conversion has almost doubled. In our experience, total conversion, so people that land on a website and then go through to the process of booking, sits between one point five and two per cent. What we’re seeing at the moment is total conversion levels reaching almost four per cent, with the average being three per cent this year, so that’s a really good insight there.

Lloyd, you actually have a great way in which you look at website traffic and booking engine services to really define your marketing strategy. Perhaps you can tell us a little bit more about that?

 

[27:15](LB): Yeah, sure. So, it just started during the first lockdown, and we were all in anticipation of when we might start seeing demand growing again. So, a lot of people, including some OTAs, actually paused their ad spend completely. We took a slightly different approach. We reduced it significantly but kept it at a trickle, and the reason we did that was so we could see our search impressions for that year - our Google ads traffic and our social ads, as well. So, by [xxxxx], our booking agent searches, we were able to really tap in, first and foremost, before the bookings arrived, when the demand was increasing, and from that, we were able to increase our advertising appropriately. We found out that we could look at the booking engine URLs for when people are searching, so we were able to see that the majority of our PPC traffic was looking to book within a six-week time period, which was fantastic, until we got to the stage where, quite quickly, we were seeing full occupancy for our summer weeks. So a lot of our spending was redundant, in effect - we were paying for traffic that, when it arrived on our website, we had no rooms available for them. So we started to look at which groups, channels, audiences of our marketing campaigns were looking to book when we had availability, so we shifted our campaigns and efforts towards those channels. So one of the things I think Sam’s going to talk about a bit later on is how we used offers for our colder months to really drive demand through that quieter period.

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[29:07] (SW): Yeah, that’s really interesting Lloyd, and when we caught up before this webinar, I found that really insightful. I think, unfortunately, as Jane referred to, and actually Aggie as well in her presentation, the part of the business that has been cut the most is the marketing and sales. But actually, you’ve got some really good advice there about how a smaller budget or limited resource can have a really big effect - so thank you for sharing.

On this stage here, then, we can see booking dynamics. These represent bookings that are being taken. Now we can see a real flipping point towards mid and end of January there when confidence really started to grow again. We can also see big spikes in demand again, similar times to when we’ve had the announcements from the Prime Minister, and now we can start to see bookings starting to steady a little bit, too.

If we could move on to the next slide, brilliant, thank you. This is a really interesting one for me. So as part of maximising the demand, we often work with hoteliers to take advantage of what’s to come. So, we can see here booking windows but also minimum length of stay restrictions. Now where we’re seeing record volumes of demand for coastal areas like Cornwall and Lloyd, I’m sure you can comment on that in a moment, we have advised putting in a minimum nights length of stay, prices - there’s definitely a huge increase in prices, which we’ll come on to in a moment. But we can see here the booking window is probably one of the biggest factors. At the moment, so this time last year, we can see the booking window is a lot lower. At the moment, the booking window across the UK is averaging just under one hundred days - so it goes to show that people are booking right now for their summer holidays, and that actually the confidence in the market is domestic. Lloyd, perhaps you can tell us a little bit more about your packages - so you’ve obviously noticed trends for people booking for the summer, and you’ve launched a summer package to support that with a minimum length of stay on weekends.

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[31:18] (LB): Yeah, certainly. So first and foremost, we wanted to ensure there was confidence to book - so we introduced certain strategies, such as offering free in-room service and looking at ways we could offer flexible cancellation policies. It was all things that OTAs were doing, that we were aware that we needed to match that and, maybe if we could, go further. So we were looking at cancellation policies, room service, maybe different dining options - so potentially not just dining with us each night - they could go and eat at a restaurant as part of that package, and we called it [xxxx Break], and particularly during the first lockdown, we saw a huge demand for that. So yeah, in terms of trying to bring those people back again, we’re obviously then looking at bounce-back offers, working with you, Sam, in any way that we can get direct benefits, and communicating to those people at the booking engine stage.

 

[32:30] (SW): Fantastic, thank you, Lloyd. So there are different ways in which you can increase the revenue. In the next section here, then, we’re looking at customer confidence, so what’s given the confidence for our guests to make bookings, and where are they coming from, and why.

The first graph I’m going to show you is around cancellations. So we can see here cancelled booking averages vs turnover as well. So again, as expected at the beginning of January, it was announced that we were going back into a lockdown, so that cancellation spike was expected there. And then again, towards the end of February when we had the roadmap out of lockdown, expected cancellations there. But otherwise, it’s fairly steady.

So, what does twenty twenty-one look like so far? There are a couple of statistics that really surprised me. The first one being a twenty-three per cent increase in prepaid rates. Prepaid rates are your advanced purchase rates or special offers/packages that are typically non-refundable. At Profitroom, we’ve enabled COVID-secure policies essentially - so on the booking engine, it’s really clear that when the guest books, they can book with confidence by paying now, and should the hotel be closed or there be a restriction which impacts their booking, they can then have that valued back in terms of credit. I think that’s really helped, but I was really surprised to see that more people are paying deposits and more people are paying up front. Lloyd, what’s your experience there?

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[34:18] (LB): I think it’s down to us being so full in the summer. There were a lot of disappointed people that weren’t able to get their summer holidays, especially when the window in which we were out of lockdown seemed so short. I think there are certainly a lot of people that are willing to secure their booking as soon as possible, and we’re seeing a slightly different clientele as what we would do previously, who are prepared to pay upfront.

[34:50] (SW): Yeah, brilliant, great insights. It is definitely one that shocked me because I think, probably naively, I expected everything to be flexible, but that’s not the case.

 

Thirty-seven per cent decrease in OTA bookings. Confidence with booking with OTAs was low, and it was quite evident that we were seeing a drop in OTA bookings last year, and that actually has continued into this year too. I think people are now more aware of the benefits of booking direct, and they have more confidence to book directly due to all of the circumstances last year, so that’s fantastic news for hoteliers. And then the last one here, so there’s a sixty-seven point two per cent increase in average booking value, and this is for like-for-like periods. So for example, if we look at the summer months, the average booking value is sixty-seven per cent higher for this summer, than it was for bookings for last summer. There are a couple of factors: First of all, obviously, as demand increases there’s room there to increase prices, but also the length of stay - so the average booking value has increased because the length of stay window has increased as well, and packages. So as Lloyd just mentioned, one of the ways to really make yourself unique is by including things like room service, and extra elements into a stay, that you can then charge more for.

And that leads us to package optimisation and providing unique stays that are experience-led. So, Lloyd, you’re in a very lucky position in that you’ve just launched a gorgeous spa. Perhaps you can tell us a little bit more about the spa and how you build packages around that offering as well.

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[36:37] (LB): Yes, certainly. So a couple of years ago, we had a fifty million pound redevelopment to the resort, and in 2020 we won the Cornwall Tourism Spa Experience of the Year for that. The spa has given us an opportunity to tap into a different market, and whereas previously we were predominantly summer based with families and people staying for that summer period, what the spa has been able to do is allow us to look at slightly different markets, maybe within a two-hour drive from the resort, bringing people down for those [xxxx] times, such as mid-week when we have low occupancy, we can offer one/two night breaks, which really pull people towards us, and we need high occupancy at the resort to hit our targets, and bringing people into the resort in October, November, December and throughout the winter is vital to us.

 

[37:42] (SW): Thank you, Lloyd. And we’re seeing that as well where demand has increased, the typical seasons if you like - so a typical high season for the UK would be around mid-July through to the first week of September, matching that of the school holidays. But actually what we’re seeing in terms of business on the books is a really extended summer period of people starting to travel from June, all the way through to half term. So the typical season in which people are willing to travel, or where you would expect business on the books has extended as well, and so have the prices.

So just having a look at packages that sell and what to include. So first of all, differentiating between a package and an offer is really important. Just because you’re going to package something together to sell to the customer, it does not mean you have to discount it. The market at the moment is very experience-led. They are demanding more for their stay, so if they can book something with an experience, they will pay more for it. Including nearby experiences (e.g. golf) is a good way to sell packages. Remember to make it unique. Don’t apply too many restrictions. The more restrictions you apply that are unclear, the harder the booking journey will be. Emotive images. Prominent inclusions - clearly list all of the inclusions you’re giving to that guest. Make sure it’s optimised for mobile. Clear booking conditions - making sure you’re really prominent with your COVID-secure policies.

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On the opposite side, what to avoid. Lifeless images. Operational nightmares - creative marketing can get carried away. Too much fluffy content - don’t try to oversell the packages, keep USPs really prominent. Don’t give too little information. Restrictive stay dates. Confusing pricing matrix - lots of hotels these days use dynamic rate plans. Make it clear if the customer is expected to pay more. Missing the target market - making sure you’re looking at your booking windows, knowing what your guests are searching for, and offers are targeted. 

 

Here we can see St Michael’s booking engine. First of all, offers and packages [xxx] where you can explore them. On the right, we’ve got another mobile experience [xxx] Port Lympne in Kent. They are another client who sells experiences really well in terms of experiences. Lloyd, maybe you can talk to us about how you bring your packages to life?

 

[42:06] (LB): We look at previous years’ sales data, and package data, to see which are the most successful. We then look at building lookalike audiences around those people and predominantly we look at targeting them via social media, we’re able to get much longer lead times with that and able to increase the amount of bookings/searches. We discuss internally which package would be right for those people, and we get a lot of website traffic.

 

[42:55] (SW): Definitely, and you have a really high conversion rate Lloyd on your website from people looking to book. Packages definitely help with that. Do you have any other tips on how to get more people into your booking engine?

 

[43:19] (LB): Our previous booking engine didn’t actually have the ability to book online, so we were having to take a lot of offers through the phones, which put a strain on the reservations list, but was also hard to track how effective our marketing was. With the new booking engine, we’re able to monitor who clicks through from our offers pages or our landing pages from our adverts through to our booking engine. We can monitor data and which campaigns are driving awareness and initial booking intention. We can then see who adds extras onto their package, and then those who reach the payment section and convert.

 

[44.35] (SW): Just moving onto the next section - and I believe Jane, we’ve got another poll at this point?

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[44:42] (JP): We do. How do you manage guest loyalty proactively? Three options: We don’t have access to that data, we have an effective guest loyalty scheme, we plan on setting up a guest loyalty scheme. (Answers: 33% for each)

 

[46:00] (SW): So the final point of this presentation is around guest loyalty, and we chose this because there’s a really unique opportunity for hotels now to not only attract a higher paying demographic, but also to retain them for repeat guests and future stays, to ensure that for years to come, hotels can still try and get some benefits from an increased ADR and sustain their business moving forward.

Here we can see impacts on recovery. Here are some lessons we learnt last year from working with hoteliers: Firstly, there was a thirty-four per cent increase in return stays for 2020. Thanks to marketing automation, we saw a huge increase in repeat visits back to hotels. The familiarity with the brand really gave guests the confidence to make those bookings. They also have some of the highest return rates. The rewards and incentives that you offer to bring them back are some of the lowest costs in terms of when you’re looking at segments and bringing people into the hotel. Lloyd, what do you do at St Michael’s to encourage people to come back and stay?

 

[47:56] (LB): It’s a concern for us all, we’ve been talking about it for the last few months - how do we encourage 2020 guests back? When people are looking forward to booking holidays in 2022, how do we ensure full occupancy? We’ve been looking at ways of improving our CRM so we can market to our guests more appropriately. We built a guest experience during lockdown, mainly because some of that personal interaction was being taken away. We introduced a guest experience to try and keep some of that together, and we saw some good results in terms of guests using the app. We use bounce-back offers to try and get people to come back, and we’re looking at building a member club to try and compete with the OTA clubs. 

 

[49:29] (SW): Thank you Lloyd, some really valuable insights. Two final points: Firstly, what we’ve seen from our hoteliers are that guests who do book again tend to spend more. They book the more superior types of room accommodation, and often book packages as well. E-marketing - during the relaunch of hospitality, with sales, marketing and revenue teams on Furlough, email marketing was one of the first activities to come back and produce bookings. It was important to keep guests and the database engaged during this time, but when you reopen, it’s your existing guests that support you first. What we saw was a huge increase in email marketing and conversions, of which most of them were repeat guests as well. And that concludes the second part.

 

[50:35] (JP): Brilliant, we have had some questions come in. Lloyd, how have you differentiated your offers and packages to meet demand?

 

[51:27] (LB): In terms of the packages we’ve put together, I wouldn’t say we’ve really changed our packages as such. What we’ve done differently is how and when we’ve marketed to that. So we’ve marketed much earlier on to those audiences, and in times previously where we would have been taking bookings for the next six weeks, we’ve been able to understand that we don’t need to advertise too hard for those next six weeks. We’re in a lucky situation where we’ve got that as traffic coming in. We’ve been putting more attention into how to target an ad audience, and getting more of those booking engine searches to increase demand. 

 

[52:25] (JP): You mentioned your spa there, which looks amazing. Have you seen the wellness feature as an important theme for staycations?

 

[52:33] (LB): Yes, it’s something that we monitor closely, wellness is at the heart of our resort and we feel as though it’s a trend that’s going to grow. We monitor search trends, search volumes, overseas audiences to see how they are growing in that market. We have seen that wellness was a trend that had confidence, particularly around December and January. It was quite hard for us because we had a lot of restrictions on the spa at the time, so we were only able to have fifty per cent of our services available. We certainly saw an increase in demand for our wellness and that’s something that’s going to be pivotal for us going forward in November/December/January this year.

 

[53:33] (JP): Thank you. Sam, how easy is it to set up a guest loyalty scheme?

 

[53:54] (SW): There are many ways to set up a loyalty scheme. Firstly, reach out to your tech partners to see how they can support you. For example at Profitroom, we have automated emails that go out to people that have stayed, with an exclusive loyalty number. They can come back and access hidden discounts, with bespoke promotions. We can also unlock member rates. The first port of call is understanding your technology and what is available, and from there you can build on it.

 

[54:43] (JP): Great, thank you. How important is customer segmentation in the customer journey?

 

[55:01] (SW): We recognise that different types of customers have different paths of booking. Category type: If we’re looking at family offers and packages vs spa breaks, people that are looking for a spa break want a calm and relaxing environment. The route in which they go to book those offers is tailored to that, vs family offers which are more fun, with more life in them. The way we integrate Profitroom with hotel websites is through those packages and experiences. The package you’re viewing on the website is then launched in the booking engine. At step one, you can compare and search for different offers and packages as well, so straight away you’re targeting directly to that audience type. Giving guests the option to do that, rather than giving guests every single rate plan, you’re missing the chance there for a unique sale.

 

[56:15] (LB): It’s a tough one, and it’s something that we’re looking at closely with updating our CRM. It’s one of those questions with, sometimes a depleted marketing resort, to then have to market to all of those segments separately, it’s always a tough one to know whether it’s going to be worthwhile. We believe it is, which is why we’re investing in our CRM strategy to enable us to do that. With our offers and breaks, we’ve looked to build similar customers to what we’ve received previously. We’ve let Facebook [xxx] take ownership of that for us to bring those customers in. It’s certainly something we’re looking to improve on our email communications.

 

[57:21] (JP): Fantastic, thank you both. Aggie, what are the best KPIs to use to measure profitability?

 

[57:42] (AW): The short answer would be GOP per available room - but the longer answer would be that it really depends because we want to measure profitability over each department and of the property as a whole.

 

[58:19] (JP): Thank you very much. Thank you to our listeners for listening, and please remember that the opinions and facts and figures today are that, so they should be treated as such.