Alexander Galarraga, lead strategist at Booking Success, outlines ways in which hotels can adjust marketing strategies, handle pre-existing bookings, and communicate more effectively to better their position in the market.
What a week this has been!
We are dealing with an international health crisis which has had a major impact on the Caribbean hospitality industry. The good news is that no crisis lasts forever and the tourism industry is known to be the industry that bounces back the fastest!
Over the weekend, many hoteliers have asked us how they need to adjust their marketing efforts in order to protect their cash flow and future bookings.
For this reason, my team and I have burned the midnight oil to provide you with actionable steps you need to take this week to protect your cash flow and future bookings.
How hotels need to adjust their marketing:
First thing’s first: Don’t panic!
The worst thing you can do right now is to panic and stop all marketing. You may be looking for ways to reduce costs, however reducing your marketing efforts right now will be the worst decision you can make.
Tourism is the most important economic pillar for most Caribbean islands and hotels need to do everything they can to make sure that their island’s tourism bounces back as fast as possible.
From a marketing perspective, I want to make sure that you are taking the right steps to not only survive, but thrive in the next few months.
The following guidelines will help you protect your cash flow, achieve future bookings and become more profitable in the long run.
It is expected that the COVID-19 will have a major impact on the travel and hospitality sector for the next three-to-six months.
It is our mission to help you survive this hurdle and come out even stronger. Those that make the right decisions during tough times like these will survive and thrive. Those that don’t, will disappear from the map.
We recommend all Caribbean hotels to follow below guidelines:
Pre-existing bookings March until May 2020
Instead of canceling bookings, incentivise guests to change their booking to a future date. Make this process easy and offer incentives (such as F&B credits, room upgrades, additional free nights, free airport transfers and anything else that has a high perceived value to your guests).
Protect your cash flow and avoid cancellations as much as you can. It is important that you approach them before they approach you. Make sure to email guests that are scheduled to arrive before May 2020 as soon as you can. Don’t let them think of canceling, postponing is a better option!
Booking Incentives for June, July, August and September
For most Caribbean hotels, June, July, August and September tend to be “low season” or “off-peak” months.
Many potential guests in the US and Europe are currently staying home and will be tired of this very quickly. They will start looking for getaways (and Google Trends is already showing that they are still very much interested in and searching for Caribbean vacations!).
Offer risk-free, incentivised “Post Coronavirus” bookings for the months of June, July, August and September, under the condition that the booking is placed directly via your website. Offer great rates (but don’t go too low), free breakfast, free resort credits, free additional nights and most importantly free date changes on all prepaid bookings. Think value added, not discounting.
Airlines are currently all offering free cancellations, so this is your opportunity to generate some additional bookings!
These prepaid bookings will help you get the necessary cash flow. This will also inspire more guests to book directly with you, which will mean a higher NET ADR because the bookings aren’t costing you commissions. This way, your guest wins and you win too!
People are still looking for Caribbean vacations!
Many of our hotel clients (specially the ones with a solid content strategy and retargeting pool) are still receiving bookings. Interestingly, we’ve noticed a trend that more people are booking direct instead of via OTAs or Tour Operators.
Perhaps this is due to a reduced trust in tour operators during these times. Just like Thomas Cook, this crisis may cause more of these giants to collapse. Which means that hotels need to work harder on their own marketing efforts to generate direct bookings. The benefit is that these bookings are typically 100 per cent more profitable compared to OTA or Tour Operator bookings. Remember that if you have an operating margin of 30 per cent (most hotels run on a lower operating margin!), that means that you are losing half of your profit due to OTA commissions.
Google Trends shows that people looking for Caribbean hotels and Caribbean destinations have increased. The only thing is that they are not booking as much, perhaps because they are usure. This is another reason to reassure your guests with great booking incentives, risk-free changes and more!
Below you can find a chart on Google searches for “Caribbean”. We are seeing similar trends on island names, including island names combined with “best hotels”, “vacation” and more.
Connect with your past guests
Your past guests need extra attention these days. Show them how great it will be to book a Caribbean vacation when the Coronavirus scare is over.
Use above mentioned tips to make it easy for your past guests to book again with amazing benefits that they can’t say no to. Remind them that airlines are offering risk-free bookings and provide them with the same risk-free booking experience with great value-added incentives for paying in advance.
Below are two great ways you can connect with past bookers:
1. Email campaigns: Focus on sending an email campaign weekly for the next four weeks. Each email should include a reminder of how great their last vacation with you was, information on (risk-free) airline specials and a direct booking special for your hotel that’s so good they can’t say no to.
2. Retargeting on Facebook and Instagram: Just like your email campaigns, you can reach past guests using custom audiences that are based on email lists. Offer easy to share, risk free promotions that your past guests and their friends & family can sign up for.
Enhance your content strategy
When everyone is locked up in their homes, they are either on their smartphones or computers searching for the better things in life – and what’s better than a Caribbean vacation, right?
Now is the time to promote your destination and your hotel.
Your content strategy should consist of: Photos, Videos, 360 Photos, Tips, Frequently Asked Questions, Booking information, Island tours, Restaurant tips, Island information and anything that makes people desire that next vacation!
Make sure every piece of content is enhanced with a call to action, a promotion, an easy way to contact you and more.
Be more accessible
Guests have questions. Lots of them. Make it easy for them to contact you. Activate channels such as Whatsapp, Live Chat, Email, Facebook Messenger and more and be extremely fast in your responses. We offer tools, such as Guest Connexxion, to help you streamline this.
When the world is locked down and everyone is afraid of airports, what is better than booking a Staycation?
It’s not only the Americans and Europeans that are traveling less. Our island people are also afraid of flying and airports these days.
Offer locals a Staycation special they can’t resist. This way, you can still fill some of your rooms during the times that there is a reduced inflow of tourists.
Let us help you
You’re not alone in this. We are here to help.
We have opened up additional space in our calendars so we can support you in this process.
We hope you understand that we will not have any in-person meetings in the following weeks and will execute all meetings via Zoom meetings to help avoid potential spread of COVID-19 ― feel free to schedule a strategy call.