DON'T PAY, BARTER
Despite the fact there is a rebound in the lodging industry, thousands of hotel rooms go unused each night. A recent panel discussion in New York City sponsored by HSMAI explored ways hoteliers can use barter to trade these unused roomnights for advertising or other services.
“The recovery not withstanding, barter remains a cost-effective way for hotels to fulfill their sales, marketing and capital needs,” said panel moderator Sean Hennessey, president of Lodging Investment Advisors. “Unsold inventory represents more than lost revenue. It's like leaving money on the table that could have been invested.”
Some small hotel companies make barter a standard line item in their annual marketing plans. According to Jennifer Rutkowski, regional director of sales for the Morgans Hotel Group (formerly known as Ian Schrager Hotels), “It's a tool we use on a regular basis. Short of a sell-out, rooms are usually available for barter. We only have eight properties, so we don't have the same market reach as many of our competitors. Consequently, we use barter to get the name of the brand out there.”
According to Peter Warren, CEO of Warren Kremer Paino Advertising, barter is one of the better ways for hotels to increase revenue. “Even if you're running 93-percent occupancy, you have unused inventory, and you're really throwing that seven percent out the window.
“Barter can be a great resource or tool. With business so strong, now might be a good time to refurbish your hotel. When you're reluctant to use cash, barter might be a good resource for that,” said Warren.
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