Market Watch - Hotels

Showing Creativity And Building Loyalty Are Key

Hotel MarketShowing creativity and building loyalty are key.

Last year, the global hotel industry set a new revenue record, yielding $457 billion, according to Euromonitor International, a 9% increase over 2010. The biggest growth worldwide was in the United States, which enjoyed a $7.4 billion boost. As hotels see their earnings rise, their marketing budgets are starting to expand, creating greater opportunities for ad specialty distributors – if they know the right approach to take.

Focus on the End-User
Even as research shows a rise in hotel occupancy rates, guests continue to be less than impressed with their overall experience. Hotel customer satisfaction numbers have been going down in recent years, according to data from both J.D. Power & Associates and Maritz Research. One key reason for the satisfaction downturn: The so-so economy has forced many hotels to cut costs and lay off staff. Although business has picked back up, it doesn't necessarily mean hotel staff sizes have returned to pre-recession levels.

"There's a point where a high occupancy can become dissatisfying for guests – it's too full, there's more noise, waits are longer, room service is slower," says Rick Garlick, senior director of consulting and strategic implementation for Maritz Research Hospitality Group.

Of course, a distributor can't get clients to hire more staff, but with hotels seeking ways to improve their guest experiences, ad specialty firms can promote products as a way to help patrons leave with a more positive impression of the property.

To this point, Heather Brown, owner of Brown Marketing & Public Relations, has had success pitching kits to hotel clients. She recalls one project for a Newport Beach, CA, hotel, where she recommended a promotional kit that included branded sunscreen and a beach towel for the adults and a toy pail, rake and shovel for kids. "It's something that's going to enhance their time at the hotel," says Brown.

Connect the Products
It's one thing, as Brown suggests, to provide creative and practical products to hotels and resorts. To go a step further, though, she thinks distributors should try hard to link campaigns directly and specifically to the location, image and history of the hotel. "Anyone can do a chapstick or keychain or lanyard, but how do you create something truly unique for the destination?" Brown asks. "Try to stay away from generic products that you could put a bank logo on as easily as a hotel one."

For higher-end and luxury hotel brands, distributors should up the ante by offering items that carry the same brand message of class and quality. "I'm looking for products beyond the T-shirts, pens and sticky notes that I can discreetly brand," says Cole Hernandez, assistant director of brand marketing and PR for the Denihan Hospitality Group, which manages a number of boutique hotel brands. "I look to fashion magazines and boutique gift stores for inspiration."

For Denihan's client, The Benjamin Hotel in Midtown Manhattan, Hernandez recently sought out a reusable tote bag. The bags he ultimately chose improve on traditional cloth totes by including a durable zipper (ensuring all items stay securely in the bag) and being elegantly branded with a double-b logo, while creating a new interior pattern.

The Benjamin Hotel also offers embroidered travel pillows to its VIP guests, who can use them to make the flight from New York slightly more comfortable and connect that comfort back to The Benjamin. "People love them, and it is a reminder to the public that our hotel values sleep," says Hernandez. "Cut through the clutter with promotional offerings that speak to the hotel's brand."

Keep Them Coming Back
While building brand loyalty is a top priority for hotels' brands, it should be something distributors seize upon as well. Working with hotel clients to develop products that need consistent replenishing can be a breakthrough win for salespeople.

For example, Alan Skulsky, the owner of Levin Promotional Products (asi/252850), has helped a hotel client create name badges used throughout the company. The magnetic badges, which include each employee's name and the country he or she is from on engravable plastic, are both useful and stylish. The product has kept the hotelier coming back to Skulsky for years. "They come back pretty frequently if they have employee turnover," says Skulsky. "We do a couple hundred a year."

Skulsky also helped ensure the company would keep buying the badges from him by crafting a level of personalization. His badge idea was forward-looking, as the item was designed in a way that "Employee of the Month" and "Years with the Brand" designations could be added to the badges, using a piece of laminant.

Target Events
Hotels do a lot more than offer guests a place to sleep. Hotel events – like networking mixers, multi-day conferences and weddings – provide a perfect chance for distributors to earn orders. Experts say distributors are wise to target the hotel's in-house event planners as well as independent planners who use hotel and resort venues.

Ron Gold, owner of Marketing Works, a public relations firm, has managed a series of business networking gatherings for a small hotel client of his – the Viana Hotel Spa and Inn in Great Neck, NY. The events allow hotels to make a great impression and promotional products can deliver the needed charm, a reality recognized by Gold. "Getting people in there gives them a chance to look around the hotel and gets them thinking of opportunities they might have to book a room," he says.

Gold contacted a distributor and decided to brand items so networkers remembered the Viana. Hotel contact information was placed on the products, a subtle move, but an important one for marketing purposes. Gold was happy with the value of the items and has continued to partner with the distributor for similar events.

Ryan Kaback, a partner at Custom Logos (asi/173183), has also done a lot of work to support hotel events, as well as more employee-focused programs, such as staff picnics and end-of-year award ceremonies. "It can range from beach chairs to cooler bags to iPod speakers," says Kaback. "It's useful stuff for the employees." He adds that for larger-scale events, hotels often work with a co-sponsor that may pay for the promotional products in exchange for having its logo or messaging on items.