Why the Collapse of Thomas Cook Should Be a Warning for Hoteliers
The collapse of travel giant Thomas Cook, which rocked the tourism industry, shines a spotlight on the ever-growing need for properties to take control of their own bookings and guest data for hoteliers. In late September 2019, the company suddenly stopped operating after more than 147 years in business. Its demise is largely blamed on the disastrous 2007 merger with MyTravel, ballooning debt and the internet revolution in holiday booking. Its collapse is a reminder that even well-known brands can’t rest on their laurels in today’s economy.
According to the travel data firm Mabrian, nearly 9 million flight seats will be canceled in the coming year as a result of the Thomas Cook shutdown. Because most hotels only have the guest’s name and a now worthless reservation number from Thomas Cook, there is no way of contacting them to rebook the rooms.
Why it Matters
The sudden failure of Thomas Cook highlights the danger of relying too heavily on third-party booking providers. Data from D-Edge shows that third-party bookings are canceled at much higher rates than direct bookings, and without any customer data from those bookings, they are gone for good. Large conference hotels and those doing big business with tour operators should look closely at their channel mix and start diversifying if they rely too heavily on any one source unless it’s their own database.
Reducing reliance on third-party booking providers and focusing on first-party data strengthens a hotel’s ability to withstand a crisis should partner bankruptcy, travel embargoes, or another unforeseen event occur. Additionally, with the rising cost of OTAs on a hotel’s margin, increasing direct bookings can help hotels keep all of the revenue generated from a booking. Plus, when the booking is made directly with the hotel, the hotel has the opportunity to market to the guest before they arrive on property, which has proven to be lucrative for Revinate Marketing customers. In fact, hotels using Revinate Marketing generate an average of $2500 a month in amenity upsells and room upgrades alone, from pre-arrival emails.
Take Control of Your Guest Data
As avid readers of the Revinate Blog already know, it is critical that hotels focus on strategies that drive direct bookings. The most cost-efficient place to start is with your existing guests. According to invesp, acquiring a new customer is five times as expensive as retaining an existing customer. Humans are creatures of habit and guests that stayed at your property and had a good experience are far more likely to respond to your marketing than someone who has never been.
How can you keep your guests coming back? Aside from ensuring their stay was positive, make sure they know that you value their business and feedback by sending on-property and post-stay surveys. If issues come up while the guest is still on property, do everything to recover the guest and show that their satisfaction is essential. Service recovery is a great way to win a guest’s loyalty. If the guest has already left the property, make sure you take the time to address feedback left in surveys or on review sites. The Revinate blog has lots of great articles highlighting the best way to respond to guest reviews left on review sites and OTAs or privately through your surveys solution.
Second, collect the guest data that you need to reach the guest after their stay. Review front desk and staff training procedures to ensure that all staff understands the importance of capturing contact information for guests, especially those that booked with OTAs. You can’t market to someone effectively if you don’t have an address. Check out this blog post for tips on capturing guest data.
Finally, make sure that you’re using the guest data you have to create impactful marketing campaigns, targeted to different segments of customers. Use the Revinate Email Marketing Guide, a fantastic resource for your hotel to build and manage email marketing campaigns that will drive direct bookings from repeat guests and referrals. The Revinate Loyalty Guide is another valuable tool that will help your property cultivate guest loyalty and drive more direct bookings.
And if you need more advice, let us know. We’re here to help.