Why Sales Matters
By the early 1990s, a lot of people in the lodging industry thought sales and marketing had become an overrated, ineffective function. Many believed location, brand loyalty and the ups and downs of the economy drove the business, not men and women knocking on doors asking for business.
That perception has changed radically in the past 10 years, thanks to shifting demographics, the commoditization of hotel brands and, most importantly, the emergence of the Internet as a powerful distribution and marketing weapon. Today, hotel sales and marketing is a creative, dynamic profession that's drawing the best and brightest people in the industry.
Lodging Hospitality recently convened a roundtable of 14 hospitality sales and marketing experts to discuss the state of their art. All members of the panel are board members or former chairs of Hospitality Sales & Marketing Association International, an organization that not coincidentally has had a renaissance in the past 10 years and has emerged as the standardbearer for sales and marketing professionalism, ethics and education in the world of hospitality.
The roundtable was held in late January in New York City a few hours before the Adrian Awards Gala, a lavish dinner and ceremony hosted by HSMAI and often referred to as the Oscars of hotel sales, marketing, advertising and public relations.
LH: What have been the biggest changes in the hospitality sales and marketing profession in the past 10 years?
Bill Weld, Traveler Discount Guide: In my early days in this business, we were a lot hungrier than many people in the industry are now, which is a sad state of affairs.
Dawn Walzak, Tishman Hotel Corp.: We're seeing a cultural and age shift in the business. Some people in the business today think they can respond to a phone call from a client requesting information by e-mailing them.
Kim Schaller, Hershey Entertainment: My role in our organization is changing like never before. Sales and marketing, and particularly marketing, used to be on the tail end of decision-making. Now we are right there from the beginning, representing the voice of the customer, pushing the brand and the brand equity. We're all about helping to create the experience.
Jack Schmidt, Benchmark Hospitality: Today, it's so competitive that you need to understand the technology and the impact on everything you do from a sales and marketing standpoint. You need to be part psychiatrist to understand this new generation and the multiple generations working at the many levels of the hospitality business.
Bruce Himelstein, Ritz-Carlton: Lalia Rach from NYU [associate dean of the Preston Robert Center for Hospitality Tourism and Sports Marketing] has a good quote: ‘During high demand times, even mediocre sales people are successful.’ After 9/11, these people got exposed because you would sit with some people and look at their sales numbers and ask what is the problem. Their answer was, ‘well, the phone stopped ringing,’ and they were dead serious.
David Atkins, Interval International: There is no question there has been a cultural shift in the business. It comes back to the question of time poverty: we're asking more from our sales people, we're measuring them in ways they've never been measured, they need to learn new systems. Yet, it's still a people business. The systems can be phenomenal, you can understand the new methods of distribution, you can understand everything there is about the business, but if you can't go out and talk to customers — whether you're in sales or marketing — you won't be long for this business.
Gary Leopold, ISM: We're in a talent war. We as an industry must look at ways to position the opportunities in the industry, the career paths in the industry and the amount of money somebody really good in this industry can make. It's really hard to find bright people, but when you do you must put your arms around them and figure out how to keep them.
Dorothy Dowling, Best Western: In the 20-plus years I've been in the business, one of the evolutions I've seen is that the b-to-c landscape is now more important than the b-to-b landscape. B-to-c is now the driver because of the advent of brands. It's understanding the total solution, and it's getting sales people who have that strategic capacity to look at all of the touch points to put together aggressive plans to both grow the business and provide total solutions to the customer.
Himelstein: Years ago you couldn't publicly say you wanted to make a career out of sales and marketing. You were doing this until a spot opened up as a resident manager or something else. That's all changed in the past 10 or 15 years as people can make very nice careers by staying in sales and marketing. It has become a profession, not just a stopping-off point.
Peter Warren, Warren, Kremer, Paino: As more companies understand that they are in the branding business or the experience business, they'll look to attract people who will enhance that experience. Unlike insurance, or packaged goods, or other industries, you've got to get people who like people, who connect with them — whether it's on the phone or face to face — and whether they're in housekeeping or the front desk.
LH: How has the Internet changed the hotel sales and marketing function?
Sal Dickinson, Dickinson & Associates: It's put a lot of pressure on the definition or appreciation of the value of direct sales in the industry. Many senior people, even in the brands, feel they constantly have to define the value of sales amongst their peers because there has been such a focus on the electronic side of the business.
Atkins: The smart properties figured out the power of the Internet very early on and they were able to positively affect RevPAR. There are superstars out there, properties branded and unbranded that fill holes, either well in advance or near term. The Internet has not changed the basics; it's just another channel. If you work that channel and work it right, you'll get everything you want out of it.
Schmidt: Speaking for a company that exclusively manages independent properties, it has been an incredible opportunity for us to enter a club in which we were never welcome before. It leveled the playing field for independent properties and allowed us to gain affordable access to distribution channels we previously didn't have the ability to mine.
Chris Avery, Passkey International: In the group sales market, you must understand how the Internet affects your customers and how your systems interact with your customers' systems in a collaborative effort so customers are always getting reservations in the manner they want them when they want them.
LH: How can the hotel business break through advertising and marketing clutter, both as an industry and as individual hotels or companies?
Warren: Years ago, 80 percent of the advertising was all alike. It was about the edifice complex, it was all about real estate. Let's show the building, the furniture. Slowly, and too slowly, the hotel business is recognizing that's not the business we're in. It's about the experience, so we need to decide what experience we can offer that distinguishes us from the guy down the street. And how can we express that in advertising — whether it is online or offline — in a memorable, relevant and compelling way and something that can build a brand.
Hoyt Bacon, MeriStar Hospitality: It's all about the emotional connection to the guest. Advertising clutter will always exist, but what really matters is the emotional connection a guest has when he or she walks through the front door.
Maureen O'Hanlon, Prism Partnership: Look what the cruise lines have done. They've gone from showing pictures of the rooms to creating an experience, something you will remember the rest of your life. It's all about what the customer experiences, not what the product looks like.
LH: How does the rise of the Gen X traveler affect the sales and marketing process?
Bacon: They start with a great sense of entitlement before they go out the door. They have different expectations. They want a complete experience.
Atkins: They're also the most informed customers we've ever seen. They shop everything and they also seek out peer commentary at sites like TripAdvisor and others. We may have the most wonderful property on Kaanapali Beach, but that Gen Xer is not just going to want to stay at that property; they're going to tell us what room number they want and what rate they're willing to pay. This customer is going to make us all change the way we do business.
Dowling: It means we must look at the world through a different lens. It means staffing your organizations with diversity. We need to see the world from their perspective, instead of judging them. From a marketing perspective, we need to deliver messages that are relevant to them.
LH: How has HSMAI changed over the past 10 years?
Warren: We as an association have advanced greatly. We've become more sophisticated and more representative of the industry and as a result, our association has become the voice of the sales and marketing executives in the travel industry.
O'Hanlon: Bob [Gilbert] has done a tremendous job in creating a staff and a very professional organization that's in tune with the needs of the members and of always providing relevance and value. We've changed the [association's] business model to appeal to revenue managers and Internet marketing professionals, positions that didn't even exist 10 years ago.
Leopold: We've become a global organization. About 10 years ago we made a conscious decision to go to Norway for our annual meeting, which in many ways became a catalyst for the new global structure of HSMAI.
LH: What do you tell your sales and marketing people at the property level to get them involved in HSMAI?
Himelstein: If I were selling pharmaceuticals, I couldn't sit in a room with my competitors and talk shop. In the hospitality industry, HSMAI is a vehicle in which unit-level competitors can sit in a room and talk strategy, trends, analysis, everything but rates. It's very dangerous to stay in one silo or thought process in your company and think there is only one way to do sales and marketing. We encourage them to take the blinders off and see how everyone else is doing it.
Dowling: At Best Western, we have two different tasks, one at the brand level and the other at the unit or property level. We have segmentation in terms of those properties that have sales people on property so there is direct relevancy in HSMAI for them in terms of the networking and educational benefits. But two-thirds of our properties probably don't have a dedicated sales person, so HSMAI provides them with market intelligence to enable them to get out there and understand the industry.
Bob Gilbert, HSMAI: We have 13 student clubs in the Americas region. The other aspect is that one of the new Special Interest Groups is just for facility members. We have a whole layer of relationships with faculty members who teach sales and marketing classes. They are our ambassadors in the schools.
Leopold: While we do very well with young people on the chapter level, our challenge is to create relevance as someone migrates from entry level to mid level to senior level.
Schmidt: A lot of the young people in our business are not in it for the 24/7 nature of the business so we find we must nudge them or require them to attend HSMAI events. But while we can make them go a couple of times, we must continue to work on the programming, the information we provide and the networking opportunities.
LH: How difficult is it to get GMs and owners to buy in to the value of HSMAI for their team members?
Dickinson: It's less of an issue than it was five or more years ago. There is less hesitancy because general managers are being held far more accountable for sales and marketing knowledge and leadership at the unit level.
Gilbert: The owners are listening now more than ever. Owners and asset managers are trying to understand the marketing and distribution landscapes. I'm amazed at the detail of questions asset managers ask on these topics.
LH: What are the challenges for HSMAI in the next 10 years?
O'Hanlon: Everything is changing so rapidly that we must figure out where we're headed. Everyone is trying to determine that in their companies, but we as an organization must be one step ahead of our members to anticipate where we're going and have the programs ready when people suddenly wake up and need them.
Dickinson: The current board of HSMAI can't continue to lead the association forever, so we need a succession plan in which we bring in more bright, passionate people from the industry and get them engaged in the association.
For a complete transcript of the roundtable, go to www.LHonline.com.
Sales & Marketing Stars
The panel of hotel sales and marketing experts are HSMAI's past chairs of the last 10 years and current members of the group's executive committee:
David Atkins, vice president & general manager, Interval International
Chris Avery, vice president of business development, Passkey International
Hoyt Bacon, senior vice president, revenue & distribution, MeriStar Hospitality
Sal Dickinson, chief executive, Dickinson & Associates
Dorothy Dowling, senior vice president of marketing, Best Western International
Bob Gilbert, president, HSMAI
Bruce Himelstein, senior vice president, sales & marketing, Ritz-Carlton Hotel Co.
Gary Leopold, president & CEO, ISM
Maureen O'Hanlon, senior partner, Prism Partnership
Kim Schaller, chief marketing officer, Hershey Entertainment
Jack Schmidt, chief marketing officer, Benchmark Hospitality
Dawn Walzak, first vice president, Tishman Hotel Corp.
Peter Warren, chairman & CEO, Warren Kremer Paino
Bill Weld, director, national accounts, Traveler Discount Guide.
HSMAI: Global Reach, Street Corner Savvy
What a difference 10 years can make. In the early 1990s, the Hospitality Sales and Marketing Association International was on the verge of irrelevance. It was losing members, wasn't fulfilling the needs of its constituents and certainly wasn't ready for the technological and branding revolutions that were about to sweep the industry.
But 15 years later, the organization is engaged, relevant, growing and preparing for the future. One could make a case that it is the most vibrant industry association in the hospitality business. Two factors changed the organization from moribund to dynamic. One was the hiring in 1995 of industry veteran Bob Gilbert to lead the group. That move coincided with an upsurge in hands-on interest by a group of dedicated and creative volunteer leaders that has worked to form the strategy of the association, while Gilbert beefed-up the staffing, operational and tactical sides. Most importantly perhaps, both Gilbert and the board treat HSMAI as a business venture that needs to make decisions that both serve the needs of members and stand on their own in terms of revenues.
“We on the board are businesspeople, so we operate HSMAI as a business,” says Gary Leopold, president of ISM and HSMAI chairman in 1996. “If a program isn't successful or isn't breaking even, or if it isn't serving the needs or members, then we look very carefully at whether to let it continue.”
While many associate HSMAI with its highly successful Affordable Meetings trade shows, it also produces a varied agenda of programs and educational tools that appeal to sales professionals, owners and operators at all levels of the business.
For example, it hosts a number of specialized strategy conferences on topics ranging from revenue management to Internet marketing. Similarly, its Special Interest Groups bring together marketing professionals with common interests to share practices and discuss industry issues.
“No matter what phase of the business you're in — general manager of a hotel, sales manager, corporate marketing — we have relevant material for anyone who wants to learn about hospitality sales and marketing, says Vice Chair David Atkins, vice president and general manager of Interval International. “Whether it's real-time on the web or print material, it's readily available for whoever needs it.”
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