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An interview with Luis del Olmo by Hosteltur

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10 February 2016 at 10:00, by

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In an interview with Hosteltur, the president of Idiso Hotel Distribution, Luis del Olmo, analyses the future of distribution and hotel sales strategies. Luis del Olmo, recognises, “First, we must improve our hotel’s services so we can analyse their profitability; they can’t just be there for the sake of it, they must sell. Once that is established we can work on increasing our profit”.

What marketing strategies can individual hotels implement to increase direct sales when faced with the growing competition from intermediaries?

It is all about strategy. Vacation hotels, basically most hotels, must understand that it is not the intermediary making the purchase, what really matters is the consumer, and in the end they, not the hotelier, decide. The hotelier must define their strategy and decide who their target market is. They may be able to sell their entire inventory through a tour operator, but they must remember that this could change, as consumers have less need for tour operators all the time, even though there will always be some clients who still use them. The same can be said of OTAs, they benefit because consumers think that some channels are cheaper than others, or marketing through traditional travel agencies who have expertise up their sleeve, and of course we can’t forget direct sales. I don’t criticise any of these, it’s no our role to do so. What we must do is enable the hotelier to choose at all times which of these players can best sell his rooms, and then apply revenue management and pricing strategies. In this way their relationship with the operators changes and they can make their prices flexible, of course, always focusing on maximizing profit.

So, what criterion should hoteliers apply when setting their intermediary channels?

Firstly they must define their strategy, bearing in mind the expense each channel generates, and then set their distribution prices. If you are selling at a price that, once you pay the intermediary cost, gives you less than other channels, you may need to eliminate that channel. Hoteliers don’t always see this clearly, it is one of the problems that service providers, as consultants hoping to asses them in strategy design, face. Therefore there is a large demand for our services, the change in consumer habits when it comes to buying, is decisive and quick. Consumers are making more use of mobile technology all the time, they are well informed and don’t need as much help to make decisions, you have to be prepared to deal with these clients.

Luis del Olmo recognises that hoteliers are aware of the importance of mobiles, but they don’t always choose their app providers well.

Luis del Olmo recognises that hoteliers are aware of the importance of mobiles, but they don’t always choose their app providers well.

Are Spanish hoteliers prepared to respond to client expectations when it comes to mobile technology?

I think everyone is aware that they need to go mobile. Just like back in the day when everyone understood they needed to go online. But it is not a case of everything goes, the quality of the responsive design is very important. There are many products that offer good prices but don’t give the best results. They are aware of the importance of mobiles, but they don’t always choose their app providers well.

And it’s not just mobiles is it? Do they also need to follow the client across different devices as they make the booking?

That’s another slant. One is revenue management and the other is loyalty management, which is where companies have great power. The best thing is to have a client registration strategy, so you can go on to analyse the information and, first get close to existing clients, and then make a model based on big data of a segment with a similar demand, and start an approach process. There are tools to do this. Some companies do it very well; others haven’t quite got there yet. But it must be unified; you can’t just focus on one aspect of the strategy and forget the rest. That’s another mistake hoteliers make: they tend to invest in what they see and not in strategy, they need to budget for the tools needed to analyse clients in the digital world, using systems on social networks that allow them to follow not just their client but also their client’s friends, making them an opinion leader. And, they need people who are able to use these tools and who are willing to receive expert advice.

How are Spanish hoteliers doing when it comes to revenue management?

There is still a long way to go. We are presently training professionals in this field at the UIB (Balearic University) with a specialised university course. It is another important task that must be carried out within the hotel that directly influences the pricing strategy. It is essential to identify what kind of person and qualities are needed for the position and then train them.

And what about the big data you referred to before; is there still a lot to do in that regards?

What I recommend in this case is to think first in terms of small data, the information you can obtain from clients that visit you; find programs or ways to talk to them via CRM, whether they are part of your loyalty scheme or not. But think of them individually, because they want to talk with you. If you don’t have the mind-set of registering your clients it is very hard to apply big data strategies. There is also an internal issue, as the hotel must be well equipped and have all the connected services to be able to analyse their movements, their tendency to buy ancillary products, etc.

So, in other words, we need to totally rethink our strategies.

Yes, but each hotel must do so according to their features and position, always aiming to increase profit. They don’t all have to follow the same route. But faced with the present market situation, now is the time to do it.

Idiso and Innwise want to become YOUR GLOBAL HOTEL SALES PARTNER, providing you with not just the best technology but also our vast experience, and of course our expert team made up of over 350 professionals, allowing you to maximize your profit.

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Idiso

En Idiso somos mucho más que proveedores tecnológicos; nuestra misión es aportar valor a nuestros clientes. Queremos convertirnos en THE GLOBAL HOTEL SALES PARTNER, maximizando los ingresos del hotelero gracias a nuestras soluciones de distribución y comercialización 360º.

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