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January 27, 2014 / BSP Marketing

Successful Hotel Management: How to Outperform your Competition in 2015 and Beyond

2014 is a great time to be in the hotel business. Industry analysts are largely in agreement that the solid numbers generated by the industry in 2013 will be even better in 2014. According to a report by PKF Hospitality, 2014 RevPAR is predicted to increase by 7.7 percent over 2013 numbers.

Successful hotel management- How to outperform your competition

Strong demand for hotel rooms combined with a limited increase in supply of new rooms will allow hotels to increase their Average Daily Rate without negatively affecting occupancy. Year-over-year demand is expected to be up by 3.3 percent and supply is expected to increase by 1 percent.

A rising tide lifts all ships

It would be a mistake for a hotel manager to become complacent and assume that the property they manage will automatically do better in 2014 than it did in 2013. Looking forward, the economy is expected to grow stronger and more people will be traveling and checking into hotels. While the travel and tourism industry will benefit as a whole, the best managed hotels will benefit the most from the favorable conditions that encourage both business and leisure travel.

The median gain in RevPAR is expected to be around 7 percent. By definition that suggests that half of the hotels will have RevPAR exceeding 7 percent and the other half will be under 7 percent. Although any increase in revenue is a positive, management should always strive to make their hotel an above-average performer. In order to reach the upper echelon in performance and profits, the focus must be on fine-tuning hotel management techniques. Are you doing everything you can to make your hotel shine in 2014?

Focus on your guests

You never get a second chance to make a good first impression. What may seem like minor inconveniences to you are perceived as major issues to paying guests. Making a guest wait because the room has not been cleaned is a problem. A breakfast buffet without a working toaster is not the end of the world, but it does annoy guests who don’t want to eat a cold bagel. Guests are your lifeblood and you must do everything within your power to assure that they have a pleasant stay.

2015 Projection Target Shows Successful FutureWhat needs to be managed?

• Budget
• Rates & revenue
• Staff and Daily operations
• Maintenance of grounds and facilities
• Marketing campaign
• Planning for the future
• Corporate citizenship


A budget is a plan that allocates financial resources to cover fixed and variable costs throughout the fiscal year. Hotel management is responsible for preparing an annual budget that covers everything from rent and utilities to employee pay and maintenance. While planning a corporate budget is a lot more complicated than planning a budget for your household, the principle is the same.

You have to prioritize your resources and decide the best way to use your available funds. Sometimes the choices are difficult. Should you upgrade your free breakfast and give your employees a raise or should you spend the $100,000 on buying new mattresses and televisions? Making the right budget decisions usually means that you have your priorities straight and allows you to utilize your available funds and resources in the most effective way.

Rates & revenue

Revenues are driven by the number of paying customers you have and the price you can charge for rooms and other products and services that your hotel may offer. You can sell rooms through several different channels, each of which might add incremental revenue for your hotel.

You have walk-in customers and customers who make reservations at your hotel’s website. You have meeting planners who book blocks of rooms. You have online travel agencies like Expedia and Priceline that will help fill empty rooms. As a manager, you must prioritize the way you sell rooms to maximize revenue.

Hotel managers must pay careful attention to market conditions and adjust their room prices to maximize revenue. Price elasticity is driven by demand. Demand for rooms change by the day of the week, the time of the year, around the holidays, and when a big event is in town.

As an example, regular Las Vegas visitors know that if they check-in to a room on a Sunday afternoon and check-out on a Tuesday morning, they will get the lowest room rates. If they check-in on Friday and check-out on Sunday, their room rates will be substantially higher.

Basic economic theory explains the importance of setting the right rate. At some price point, you will maximize revenue (sale price x number of sales). If you charge too high of a price, you will not make as many sales. Setting a low price may generate more sales, but it also will result in lower revenue per sale.
While experienced hotel managers have a good idea of when they are able to push rates higher without hurting occupancy, it is not an exact science. You must know the competition and know your customer. Computer software programs are available to help you analyze the price/revenue equation.

Staff and Daily operations

Take care of your employees and they will take care of you. Someone smart said that a long time ago and it certainly applies in the hotel industry. As a manager, you need to establish an atmosphere where employees feel like they are part of a team. Setting up a system where performance is recognized and rewarded will encourage people to work harder toward meeting company goals.

Your front desk staff, housekeeping crew and maintenance workers are best equipped to identify problems and make suggestions as to how things can be done better to improve the hotel. Listen to them. While management styles can vary, it is essential to be on-site and interact with both staff and guests. When you see first-hand how your hotel is operating, you can quickly identify areas that may need attention.

Always be available to listen to your staff or take the lead in handling issues that can impact your hotel’s reputation. Walk around the breakfast buffet and casually engage hotel guests to see how they feel about their stay. Being social is an important part of being a hotel manager.

Maintenance of grounds and facilities

You can not afford to let your building or grounds deteriorate or you will see exponential growth in the number of online negative posts on hotel review sites. Just like you want to have great curb appeal when you are trying to sell your house, your hotel should also have great curb appeal. Landscaping is important, particularly near the entrance to your hotel. Sweep the sidewalks. Make sure the building looks presentable.

The lobby is the first thing that guests see when they enter your hotel. Does the furniture and décor make the positive statement you want it to make? Money is well-spent on updating a tired-looking lobby.

While you budget may not allow you to do a major overhaul of your hotel, you should make sure that what you have is kept clean. Windows need to be washed, carpets vacuumed and furniture polished. While the task of maintaining your property may be the responsibility of others, as the manager, you need to see that the job is being done correctly.

Marketing campaign

From traditional advertising to the further development of your social media program, you need to step up your marketing campaign to be competitive with other hotels. Everything changes so quickly in today’s online world. You must be at the forefront of change and stay ahead of the curve to succeed. Integrating mobile strategies and recognizing that there are more social media platforms than Facebook and Twitter can pay big dividends as you try to reach travelers in 2014.

Marketing campaign

Don’t treat social media as an afterthought. Your competitors are actively trying to improve their online presence and you can not afford to lag behind. Engage your younger employees who are savvy social media types. Hire professionals who are adept at capturing the attention of the Millennials. Don’t ignore the power of the Internet.

Planning for the future

Failure to plan for the future can lead to stagnation and a decline in business. Hotels that do not think about tomorrow can quickly become irrelevant. Examples of companies failing to develop a strategy for the future are everywhere. Look what happened to Kodak when everyone started using digital cameras. Blackberry failed to adapt to the changing technology and is now in danger of going out of business.

The same is true of hotels. If you do not give people what they want, they will go elsewhere. In addition to providing more amenities, you need to provide more value. Hotel management must analyze the trends and make plans to modify their operations to meet the needs of future hotel guests.

Corporate citizenship

Being a good corporate citizen means giving back to your local community. You can do everything from contributing to the building of a new park to advocating for community services to help children or the elderly. Being environmentally conscientious is another area that will show good corporate citizenship. Surveys have shown that “green” hotels are preferred by travelers.

Good management is the driving force behind the success of any hotel. Hiring a professional hotel management company can completely turn around the fortunes of an under-performing hotel. In 2014, when travel is expected to increase along with an improving economy, having a great hotel management team is more important than ever.

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