TURNING DATA INTO DOLLARS
OR
HOW AN ITALIAN ECONOMIST FROM 1880 CAN BOOST YOUR OCCUPANCY NOW


Too Many Numbers, Not Enough Time

Nightly occupancy analysis, weekly forecasts, monthly management reports, annual audits … if you’re like many decision makers today, you are drowning in data but may be starving for information – information that can boost occupancy and make your operation more profitable.

Reports can do more than tell you if you did a good job last night, last week, or last month. If you approach them as sales tools[1], reports can tell you the two most important things you need to know:
What Kinds Of Customers Want What I Have?
Where Do I Find Them?

More than Just Numbers

Let’s take a brief look at some standard reports that might be available to you from your brand, your management company or your reservation services provider:

• Distribution analysis – tells you how the customer is finding and booking your hotel
• Rate plan / plan code report – tells you what kinds of customers book your hotel
• Area code report – tells you where the customer calls from to the reservation center
• Denial report (by rate plan) – tells you when customers want your product
• Travel agency commission report – tells you who some of your biggest producers are and where they are
•
If three of your biggest clients are pharmaceutical companies from the Midwest … then chances are other pharmaceutical companies from the Midwest also come to your area!Corporate ID report – you may also receive reports that enable you to identify the companies, and therefore the types of companies, that use you based on the guest’s corporate id

In addition, there are a variety of other sources of data about your customers. These may include:

• Leads from the CVB or Chamber – tells you the kinds of customers coming to your area and where they originate
• Analyses from your state’s departments of tourism and economic development – again, these report tell you the kinds of customers who come to your area and where they come from.
• Business cards – the business cards of existing guests tell you the types of companies that come to your area and where they come from! If you are not collecting them – start today.
• Your competition’s parking lot and reader board. Remember, customers who want what your competition has … want you.

And this is where that Italian economist comes in …

More than a Theory

Over 100 years ago, Vilfredo Pareto discovered an economic principle that can make your property more successful … right now. It’s called “Pareto’s Law”, but you may know it better as “The Law of 80/20”. Technically Pareto’s Law states that “80% of the consequences stem from 20% of the causes”.

But it’s what Pareto’s Law allows us, as salespeople, to do that matters. The law of 80/20 allows us to separate the “critical few” from the “trivial many”. You don’t have to go after every customer in the world … only the ones that are like the ones that already use you or your competitors[2].

A Practical Approach to Getting More Customers

Pareto’s Law allows us to work smarter, not harder! It also points out where to spend your sales budget most effectively! Let’s look at how it applies to hotels
• 80% of your business comes from 20% of your market segments
• 80% of your business comes from 20% of your feeder cities
• 80% of your profits come from 20% of your customers
• 80% of your energy should be spent on the 20% of your customers who are most profitable
• 80% of your innovation comes from 20% of your employees/customers

Armed with this information, you then know
• Where to make sales calls
• What kinds of businesses to call on
• What types of companies to direct mail … and in which cities
• Where and when you should advertise
• What message to use on a brochure, a website or an ad
• Where to place billboards
• Which visitor’s centers to stock with your expensive brochures.

Cutting Your Losses

Despite what some sales motivators might tell you, there is nothing intrinsically wonderful about going after the “impossible sale”. While you are spending precious time working on someone who doesn’t really want nor need what you have, think of all the customers who do. Someone else is selling them.

To put it another way:

FISH WHERE THE FISH ARE BITING
[1] As a sales tool, these reports must be shared with the sales department as well as operations.
[2] If you want a different kind of customer, you may very well have to change your product.

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Mary Wiley
Imiga Marketing
(973)889-5337