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From the course by ESSEC Business School

Demand management: Breaking down today’s commercial silos

183 ratings

ESSEC Business School

Demand management: Breaking down today’s commercial silos

183 ratings

Course 3 of 4 in the Specialization Hotel Management: Distribution, Revenue and Demand Management

The biggest challenge facing the hospitality industry over the next 5 years is the lack of integration between the key commercial disciplines of sales, revenue, distribution and finance and the negative impact this will continue to have on delivering asset value and maximum profitability. This course, spread over 4 key modules: Asset Management Demand Generation Digital Marketing Demand Optimisation aims to break down these commercial silos and reveal the journey from long-term asset development through to short-term profit tactics and how commercial teams can align themselves throughout the organisation. Created by SnapShot, this course is hosted by a group of experienced Industry guest lecturers in their fields of expertise and includes an ideal mix of accessible theory and practical exercises and simulations. SnapShot is a Hotel Demand Management company that specializes in helping hotels aggregate and use their data. We provide useful tools as well as innovative education and coaching services to empower hotels to take informed decisions in managing their demand to increase profits.

From the lesson

Demand Generation

In this module, you will understand what demand generation means, and explore the key factors that ensure that you can achieve your goals in terms of the hotel's positioning in the market place, the profitability of the operation and its long term valuation.

Meet the Instructors

Peter O'Connor
Professor of information systems, Director of the MBA in Hospitality Management
Information systems
Alex Slors
Independent Hotel Asset Manager & Development Consultant
Asset Management
David Turnbull
Co-Founder and CCO
SnapShot
Brendan May
COO Livabout
Martin Soler
Independent Marketing Consultant
Lennert De Jong
Commercial Director
Citizen Hotels

[MUSIC]

Demand management doesn't replace sales and marketing activities per se.

However, it brings together the entire commercial organization

of a hotel to start working together from a longer term perspective.

In the day to day activity, we tend to kind of allow these silos to build up,

where reservations, revenue, finance, distribution, sales, digital,

we all go through the motions, we all believe we're working from the same plan.

But we work from very different perspectives.

Reservations and revenue focus on the stay date.

The digital and online marketing teams focus more about the conversion date.

So, I believe that demand management is this, in the short term,

great opportunity for an entire organization to be focused on one singular

activity, making profit, with a long term eye on the valuation of the asset.

This is really simple and it's the KISS principle of Keep It Simple and Stupid.

You want to have very effective data broken down into logical buckets so

that you can easily track and measure your customers' behavior,

booking activity, and a post-stay activity.

So this focus on simple segmentation.

Don't allow your operational systems to dictate to you

how you're going to manage your business.

Rework your data.

Rethink your segmentation.

Think back to what your business mix is and come up with a very kind of clear

strategy as how you're going to attract and talk to these mixes and

segments of customers so they convert in a very logical way.

It all ties together, it all comes back and it means in particular getting those

key departments of marketing and revenue and sales to work together to have

a logical plan from generating the demand through to converting the demand.

There is and frankly,

it really comes back to points that I've talked about in the module.

About focus on the organizational structure.

There is no one particular structure that is right for every hotel, but

it's important that it's designed in a way so

that all of these different commercial departments are able to work in harmony.

In short, mid, and long term planning.

But it also comes back to, kind of, logical standards and processes.

I think, again, in terms of that, kind of, keeping the data smaller and

smarter, it's about thinking logically

about how good is the quality of data that I have to make my decisions upon?

Do I do the basics of things like reservations management?

Do I clean out all of those tentative and potential to be cancelled reservations?

Do I have my data structured well?

Can I follow my business easily?

These all come back to the same points of having those great structures and

standards in place.

Training, training, training, and more training.

Giving the whole organization that sort

of understanding of what it is that you're trying to achieve.

How many hotels have Afghanistan as their number

one nationality when they run their reports?

Why is that?

Because Afghanistan is the first country on the list in the hotel's property

management system, and the front-desk agents who check the guests in,

don't care about selecting the right country.

So we have these amusing, but strange, anomalies, and that, for me,

is a great example of where, if we get the data right first time,

we're taking a big step towards getting a successful culture of Demand Management.

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