Corporate orientation in today's hospitality/Hotel business

Updated: January 01, 2012

As we are hearing from the most of the hotels, the best customer for many of them comes from the corporate segment. Corporate customer means customer, which is representative of some other company and uses hotel facilities as accommodation or conference hall. The reason why is this customer valued is because corporate clients are predictable, continuing with cooperation (returning) and in many cases, hotels can place them as item to the financial planning as most of the corporates have annual budget and plan upon which they act.

In the past, those customers were not troubled by any budget on conference and if they were, the budget was good enough, or big enough to satisfy the hotel. Even the frequency of the big events was not big, it was still worthy.

If we will forget financial and sales side, we also have to mention communication and marketing benefits from such customer and its events. As most of conference are, they are multi/company and very often they have their own publicity. If we are not talking about media publicity, they are their own website, where the corporate will almost certainly place its events and off course with some summary from the event as when and where it took place. So hotel can benefit from this activity.

Today's situation/corporate - hotel partnership

These days Hotels facing three major shifts in the field of corporate-hotel partnership.

The first one shift is different approach in the sales policies and strategies which are more orientated on the internet sale. This means in practice, that personal sale is no longer used that much and hotels chose to give more importance to the easy and cheaper internet sale of their capacity via websites etc., The good thing about it is, that there is not so much costs, marketing and acquisition time is less and for that the employee number can be reduced. The bad thing is, that this kind of sell is not targeted and its strategy is more massive.

Second shift is connected with the financial and market situation as corporates are more tight in the budget. For that they will reduce their activity in the days of internet, when they can also produce internet conference and also in their activity with travel. If they are to travel, then they will do so in cooperation with budget accommodation.

Third shift is in quality of the hospitality area and its development. There has been big grow in the low cost accommodation which quality grew higher in standards while price stayed at the same level, and big gap in the customer services quality and general quality of hotels with higher ratings, while price even increased.

The result is, that not just corporate clients are not attracted by standard hotels as they were, but hotels have to make decision upon the market. They have to consider corporte client needs. The corporate need and problems connected with its satisfaction was always higher then with ordinary travelers.

Also it is necessary to mention the costs of those extras and maintenance.

Decision making whether or whether not to be oriented on corporate sale and if, how much?

Hotel should audit all facts, consider all facts and act upon them with customer segmentation. Facts to consider are hidden in a few analysis. Some hotels are not able to view them and for that reason we've had have great chance to see them struggle.

Area analysis

Area analysis should bring the view on attraction in the look of corporate clients. There are some ways, how to predict success or failure in this field. Hotel has to find out of the area where it is placed is active in medium and major business or industry field and how many international companies are represented in the area. Also it has to be revealed if there is any big plans for future as well as if the companies or factories active are stable. For that we need to research type of company, as this type of companies will move to another regions or countries if necessary for their own budget and strategies. If they will do so, than the gap after they leave can be very problematic for the hotel.

CRM analysis

CRM is very important factor, however even the hotel database is not ready or sufficient to provide good background for the hotel sales and marketing activities, there are ways how to reach the point of change. It just matter of costs in financial sector and time consume.

In case we do have sufficient client database, which is able to deliver good basis for sale and marketing, we should evaluate it and find out what is the structure of dead contacts and how to rescue them, and state percentage of those which are active and those with unknown status.

If not, we can build the CRM, but we have to take into account, that to build this database is time consuming with no insurance and we will need team, which will be concerned with this segment.

Market and concurrence analysis

This segment is one of those with great importance. We should know our market. We have to view how many concurence we do have, in what RTU rate and with what activity. Following with their analysis to be able to view, if there is any advantage we are possesing and if not, what costs will be applied if we will create one.

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