Navigate Through the Adverse Impact of Coronavirus on the Hospitality Industry
With more than 422,878 affected and the number exponentially growing in over 144 countries, the COVID-19 pandemic is showing no signs of slowing down. The spread of the coronavirus has destroyed the global economy and life as we know it has come to a complete standstill.
Most countries facing this pandemic are on lockdowns and facing a complete shutdown of schools, workplaces, and offices. While these measures are extremely important in reducing the spread, it has resulted in an economic emergency, impacting various industries.
Unarguably, the hospitality industry has taken the hardest fall. With a complete halt in travel, the hotels are empty.
Here are some revenue management tactics and recommendations you can exercise to deal with the situation:
Don’t panic. Take rational decisions.
It’s easier said than done but now is really not the time to panic. Analyze the situation and make decisions to maintain your business while ensuring the health and safety of everyone around you. Take this time to plan ahead. You will need to rise faster than before and play catch up, and in that, any help you can get is good. Turn to automation that can boost your hotel’s performance and revenue. Get your staff to come up with creative ideas on what can be done once the lockdown is lifted.
Safety is the priority.
During this challenging time, your priority should be the health and safety of your guests, hotel staff, your family, and friends. Follow the rules imposed by the government and the safety guidelines outlined to prevent the spread of coronavirus. Everybody has a responsibility to take to ensure we bounce back to normalcy as fast as possible.
Create a prevention plan that helps hotel employees, guests, and your potential guests put at ease, ensuring a safe experience.
Ensure everyone is on the same page as far as the prevention measures are concerned. Empower your employees with information and provide guidelines to them on how exactly they should communicate to guests on your prevention plan.
Reassure your guests.
Give assurance to your guests that you are going above and beyond to ensure their safety. Let your guests know that you are following the government’s guidelines and best practices to reduce the risk. Send them messages, letters, or even hold common briefings for all.
Keep in mind that dropping the rates will not necessarily increase your demand.
You may be tempted to heavily drop the prices of the hotel rooms and expect the demand to increase. However, in this time of crisis, this decision can have a short-term positive impact. You’ll quickly find yourself at the bottom of the race where everybody is dropping their rates. Avoid this situation as it will have a far more negative impact on the long-term as hotels will find it challenging to recover from this rate degradation when demand returns.
So, stick to your usual price positioning for as long as you can. And, invest in tools like our automated dynamic pricing system to help you keep up with your revenue management.
That said, you can consider a few options without dropping your rates, such as free breakfast or any value-added service or pay for 2 days and stay for 3 days offer, etc.
Allow your guests the flexibility to change the booking date as per their convenience. Promote this flexibility throughout your channels. Evaluate your booking engine rates to ensure your cancellations, and flexible rates are highlighted. Ensure your use ‘flexibility’ as your primary marketing message.
With no reservations and more cancellations, you need to have a tighter cost control to maintain healthy cash flow. Ensure that your cost reduction actions are short-term activities, and they do not harm your business or your brand in the long run.
Prepare for the bounce back.
The travel industry is hugely impacted right now, but once the situation stabilizes, the demand would return. If you are proactive in developing a strategic contingency plan that includes a balanced portfolio of sourced markets, a sensible pricing strategy, trained staff, or possible upgrades to your hotel property, you will have a competitive edge when the market makes its full recovery.
Once this lockdown is lifted, people are going to flock and travel for some respite and solace. You need to conserve your energies to deal with that influx later. Keep your staff up-to-date. Hold video meetings with them for training troubleshooting, prepping – whatever you think will keep them in the groove and get them ready for the times ahead,
And remember, we’re here to help with a 2-month FREE trial as of March 2020 for our dynamic pricing system that will work as an added layer to your existing revenue management system. Take this time to get your staff used to our system so it can work wonders for you later!