How To Deal With Common Problems In The Hotel Industry
Hotelier Raj wants to start a hotel business. He is full of optimism and excitement. He does market research, looks at competitors and key players, learns about hotel revenue management, and even learns social media marketing. However, there is one thing he forgets to do, which will hamper his business. What's that? You may ask. The answer is simple: Jim was so excited that he forgot to learn about the problems in the hotel industry. For any business, to do something great, we need to know what not to do.
You need to know how to deal with common problems in the hotel industry, and we are going to explain how to do it smartly and efficiently.
How To Solve The Common Problems In The Hotel Industry
Recruitment And Management of Staff
The staff are the representatives of your hotel. You need good quality staff to start and run the hotel. The hotel also needs a diverse staff since the industry itself is diverse.
You need staff for housekeeping, food and beverages, reception, digital marketing, client servicing, purchase and sales, and so forth.
Managing staff is a challenge too. Hotels need to ensure that the staff is well paid and all their grievances are met. Hoteliers need to also ensure that they are following the policies of the hotels.
The best solution to this common problem in the hotel industry is to list your property on recruitment platforms such as LinkedIn. You should also have an option on the hotel’s website wherein the candidates can directly apply for any position.
Hotels need to constantly monitor their performance and ensure that they are following the parameters.
Ever Changing Marketing Trends And Dynamics
Hospitality is a competitive industry. Hotel owners need to understand what the market wants and when. Trends which were popular in 2021, can be obsolete a few years down the line.
Not being able to follow the trend is one of the most common problems in the hotel industry. For example, if it is a natural resort, you will be behind your competitors if you don't include camping in the package. Customers expect instant redressals of their grievances.
The best way to understand the new trends is to research upcoming hotels and the categories they are targeting. Google Search can be used for identifying various emerging marketing trends.
You should keep on researching the emerging marketing styles to reach the consumers more efficiently.
Housekeeping is one of the most important aspects of the hospitality industry. It also means that housekeeping issues are one of the most common problems in the hotel industry.
The way the rooms are maintained will either make or break your hotel. A hotel may offer the best services and the best amenities. However, if the room is unkempt when the guests enter the room after checking in, the hotel is guaranteed a less than a three-star rating.
Regularly inspect the rooms and follow up with your housekeeping staff. Keep reviewing their performance. The management should also personally inspect the rooms and see if the housekeeping is doing its job. If any flaws, explain them and ensure that they perform their tasks well.
The hotel industry is dynamic and competitive. Hotels that are able to establish themselves, manage to stay for a longer time. However, if a hotel doesn't then they will have to shut down.
A hotel doesn't only face competition from other hotels, but the hotel industry itself is facing competition from other types of accommodation such as homestays, resorts, villas and holiday homes. Not keeping yourself at par is one of the common problems in the hotel industry
If the hotel is a franchise, it can diversify into different segments such as Aparthotels, Villas and homestays.
Hotels can also include upcoming and trendy vacation experiences. Even a single property hotel can host several types of accommodations to diversify choices.
As far as your existing offering is concerned, hotels need to modify and upgrade the existing offering to shine amongst their competitors.
One of the most common problems in the hotel industry is cost management. A hotel incurs a lot of costs to run. From perishable items, furniture, utensils, bedding, and regular maintenance, you have to deal with these expenses. Perishables are the most crucial since they cannot be carried forward beyond a certain point.
On top of regular expenses, hoteliers will also need to deal with unexpected expenses, such as malfunctioning of an amenity, massive damage, or sudden increase in public relations costs due to some incident. You need to also keep depreciation in mind.
Cost Management is something that the hospitality industry can't escape from. It is one of those inevitable problems in the hotel industry. Wastage and unexpected costs are inevitable, but you will need to manage those costs effectively through budgeting as well as proper classification of costs.
Improve your service and use resources efficiently to reduce costs and make the business more profitable.
Food And Beverage Quality
The quality of the food and beverages will determine whether the hotel is loved or is hated. You need to manage this sector delicately since many goof-ups can lead to your hotel getting cancelled for good.
Any inferior quality food or beverage can make the guests sick, ruin the taste of the dining experience and give your hotel a bad reputation.
Keep strict quality control standards. Your purchase department should be made to understand that they need to source their food and ingredients from the best place. Regularly inspect the quality of food, fruits, vegetables and other groceries.
In case you detect that the food is spoilt, discard it immediately. The dish being cooked is exactly the way it is supposed to be cooked.
Customer Relationship Management
The hotel depends upon your customers. If you can gain as well as retain customers, the hotel business will flourish. Customer Relationship Management means managing relationships with the customers to not only sell a service but also retain them and persuade them to continue the relationship in the future.
This is where many hotels are floundering. They may succeed in gaining customers but fail in maintaining a good relationship with them.
The first step in Customer Relationship Management (CRM) is to collect data of the customers. Hoteliers can do this by asking them to register on the website by asking for their email addresses. Hotels can ask for other details as well, such as age, gender, and location. Through this, A hotelier can segment the customers and target them accordingly.
Chart out a sales funnel to identify the stages which the actual, as well as potential customers, go before they finalise the purchase.
Hoteliers need to identify who are their most profitable customers and then try to maintain that relationship. Tracking CRM helps identify the effectiveness of your campaign. There are many CRM tools that can be used. Some of them are Scoro, Sugar CRM, Salesforce and many others.
Revenue Management is at the very core of the hotel industry. It involves analysing and forecasting customer demand and then devising the best rates to gain maximum revenue.
It also involves identifying the best rooms which can be given to a type of hotel guest.
Identifying the right platform to sell the hotel is also an integral part of revenue management.
It is also one of the central problems in the hotel industry. Improper revenue management will cause hoteliers to incur losses.
In order to tackle revenue management effectively, hoteliers need to first make a budget and forecast. Keep certain estimates in mind and then devise the budget to meet those needs.
Forecasting provides you with a reference to check the actual performance. A Hotelier should also analyse its competitors to understand what they are doing and further improvise on it.
Online And Digital Presence
If a hotelier wants to attract customers, it needs to be first visible to the customer before anything else. If the property is not on the internet, it doesn’t exist for the modern customer.
Another problem is not only inadequate online presence but improper social media presence. If you don’t reach the right platforms, the business will not succeed.
SEO or Search Engine Optimization can be a hotelier's best friend. Before anything, you need to first optimize your website to generate more organic traffic. A Hotelier also needs to use social media intensively and extensively to reach more audiences.
A focus on content marketing can also make a lot of difference since people need more innovative content. Hoteliers should also include blogs on their websites to make them more attractive to those who are looking for informative content.
Hoteliers are using more advanced technology in order to improve their efficiency. Data marketing has become a major force, with many software being able to compile data of their guests and market and remarket them.
Not adapting to these technological changes is one of the major problems in the hotel industry. The hotels that are able to adjust to the technological changes will be ahead of those who don’t.
The best solution to this problem is to gradually adapt to the changes. Adapting too fast without proper planning can do more harm than good. You need to learn about the technology in detail and slowly but surely make your workforce accustomed to it.
Change In The Expectations Of Customers
Customers’ tastes and preferences have changed and will keep on changing. For example, a customer now wants to enjoy ‘Glamping’ - the luxurious camping experience, rather than a standard resort. Customers also want a property that offers a ‘woods’ experience. Of course, there are certain categories that will garner tourists.
However, even they have to adapt quickly to the changes. For example, there will be customers who want to stay at a luxury hotel. However, the very definition of luxury is being changed. Now, a luxury resort with a spa isn’t even considered a true luxury resort now!
A hotelier needs to first understand what your hotel represents. If it is a mid-range hotel, it doesn’t have to include too many luxuries since the target customers need a comfortable bed and good amenities. However, hotel owners should always try to add something which will make the property stand out from others.
For example, the hotelier can add a sauna area or a relaxation area. This will help the property stand out. If a property has a large green area on your property, especially if you are a nature resort, camping can also be organized.
Inadequate And Improper Marketing
If you want to gain customers, you will need to do proper marketing. Marketing involves advertising, sales promotion, public relations, direct marketing etc. A hotelier needs to understand these tools of marketing to reach the right customer at the right place. Not managing this properly is one of the common problems in the hotel industry.
Understand each marketing strategy tool and how you will use it to promote the hotel. Understand that these tools work together and hence, coordination is required.
Malfunctioning Of Amenities
The amenities define the hotels. Whether your amenities deliver or not can affect the business’s reputation. An unclean swimming pool, a broken toilet spray etc, can ruin the guest experience, no matter how good the property is.
A hotel needs to regularly inspect the hotel amenities to ensure that they are working. A dedicated supervisor is required to inspect the rooms, amenities, and other areas of the property.
Your hotel can face an unexpected crisis, such as fire or leakage. Hoteliers need to be prepared for such crises to minimize damage. Lack of preparedness is one of the major problems in the hotel industry.
Arrange for fire extinguishers and have people at hand who can come and manage the crisis. Also, ensure that the panic is managed. If there is any other goof up, it should be sorted out as soon as possible.
Covid has adversely impacted the hospitality industry. One of the biggest problems of the hotel industry is how to recover from the lockdowns and lack of business. Even the potential customers are hesitant to explore as there is still concern about Covid.
The hotel needs to take covid appropriate measures such as ensuring social distancing, providing sanitisers, and masking up your staff. You need to instil confidence in your customers that their safety is guaranteed.
Losing Loyal Customers
A business can lose loyal customers for several reasons. The quality of the service may degrade or the customer isn’t being provided with the service regular customers expect. A customer can also find other hotels better than yours. Retaining customers is one of the common problems in the hotel industry.
Retaining your loyal customers is the core of Customer Relationship Management. Offer loyal customers better service and discounts, so that they have an incentive to stick with you.
By tackling these problems in the hotel industry, you will be able to navigate your business in an efficient manner and also gain new customers. Bigfoot Hospitality is here to provide you with effective Hotel Revenue Management as well as Hotel Marketing. Check our blog page to learn more about the hotel industry.