Chapter 5: Systemwide Reservations

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Chapter 5: Systemwide Reservations. Focus Points. Importance of guest reservations to travelers and lodging establishments Overview of reservation system Sources of reservations Forecasting reservations Overbooking (occupancy management) Processing guest reservations. - PowerPoint PPT Presentation

Transcript of Chapter 5: Systemwide Reservations

Chapter 5: Guest Reservations

Chapter 5:Systemwide Reservations1Focus PointsImportance of guest reservations to travelers and lodging establishmentsOverview of reservation systemSources of reservationsForecasting reservationsOverbooking (occupancy management)Processing guest reservations2Classroom PresentationsIntroductionReservations are a necessity for travelersReservations are a necessary marketing tool for hotels to produce a profitSteady flow of guests to a property 30% with a central reservation systemFacebook, Twitter, corporate blogs, LinkedIn3Overview of reservation systemChoice Hotels International5900 franchises30 countries; 479,000 rooms4Overview of reservation system (contd.)Brand names

Comfort InnCambria SuitesComfort SuitesSuburban Extended Stay HotelQualityAscend CollectionClarionSleep InnEcono LodgeMain Stay SuitesRodeway Inn

5Overview of reservation system (contd.)InterContinental Hotels Group3500 hotels and resorts100 countries535,000 guest roomsHilton 3,000 hotels 500,000 rooms in 74 countries and territoriesUse a work-at-home program for its call center staffincrease its quality of customer service decreasing call center costs6Overview of reservation system (contd.)Intercontinential Brands Hotels & ResortsCrowne Plaza Hotels & ResortsHotel IndigoHoliday Inn Hotels and ResortsHoliday Inn ExpressStaybridge SuitesCandlewood SuitesPark Inn HotelsPark Plaza Hotels & ResortsRegent International HotelsExperiences over 7 million visits to its web site each month.Marriott International3,200 lodging properties in the United States and 66 other countries and territoriesUses TravelCLICK Hotelligence in 150 of its select service and extended stay properties including Courtyard, Residence Inn, Fairfield Inn,TownePlace Suites, and SpringHill SuitesHotelligence not only helps our hotels make the right decisions, it also helps them make decisions more quicklyso they take advantage of opportunities before their competition."

7Carlson Hospitality WorldwideCurtis-C (pronounced courtesy) reservation system730 hotel locations and six cruise ships8,900 reservations per day processed; over 3 million per year (2000) Overview of reservation system (contd.)8Carlson Brands http://www.carlson.comRegent International HotelsRadisson Hotels & ResortsPark Plaza Hotels & ResortsCountry Inns & Suites by CarlsonPark Inn HotelsRadison Seven Seas CruisesOverview of reservation system (contd.)9Carlson - Connected to 455,000 travel agentsCarlson - Data InterfaceHARMONY the PMS of the hotelsCustomer KARE system (Customer Knowledge and Relationship Enabling System)Harmony Database Manager room inventory and room reservationsGuest Communication Manager manages guest satisfaction informationKnowledgeNet provides access to company policies, forms, reports, hotel procedures and newslettersOverview of reservation system (contd.)10Global Distribution SystemGlobal Distribution Systems (GDS) are distributors of hotel rooms to corporations such as travel agents that buy rooms in large volume. (115 million room nights = $20 billion in 2008) 1. Amadeus 2. Galileo 3. SABRE 4. Worldspan TravelCLICK, the source of hotel industry electronic distribution for many GDSsPromotional advertising and methodology for measuring advertising reach to a travel agent audience that yielded over $8 billion in hotel bookings in 2008Insertion of Best Available Rate (BAR) for check-in date11Role of the Internet in Securing ReservationsIntro A buyers market place with the best rates on the InternetSocial Media - Facebook, Linkedin, Twitternetworking is going to be the second-most popular online activity by 2012, overtaking shopping and surpassing both communicationsuch as emailand entertainment

12Role of the Internet contd.Background on Room Rates offered via the mania hits consumers ->wholesalers decided to advertise free offers to entice consumers to use the InternetLeaves lasting impression on purchasing mannerWholesaler offers to take empty hotel rooms into inventory and offer on Internet -> hoteliers grateful to sell rooms at low sale pricesInternet sales light; everything seems okOther Internet sites offered similar models with their discounts guaranteed lowest price -> transparency of rates (guest can check room rates before check-in to see if their rate has been offered lower on the Internet)13Role of the Internet contd.Effect of Internet on Pricing Rooms Muqbil 200335% of Americans used Internet to research travelReal-time rate information availability causes re-book booking, if lower rates are postedMinus $1.27 billion to lower ADR because of increased transparency and price competition and increased revenues due to increased bookings stimulated by the lower rateInternet average rate is 17% less than non Internet rate75 % were discount seekers and 25% were convenience bookers.Price transparency during low periods is a negative for hotels to increase rate; opposite during peak seasons.14Role of the Internet contd.- Customer Relationship Management (CRM), management of guest services with technology.It allows travel companies (travel suppliers and online travel agencies OTAs) to engage customers in strong, personalized and mutually beneficial interactive relationships, increase conversions and sell more efficiently. 15Role of the Internet contd.Consumers Response to Use of the Internet Third-Party Websites (Expedia, Travelocity) serves 14,000 customers in more than 140 countries around the worldGDS and Pegasus Hotel e-Commerce room night sales = 57,131,438 (46,510,434 sold by travel agents and 10,621,004 by consumer off the Internet) second quarter 2004Over 65% of online hotel bookings will come from the direct online channel i.e. via the hotels own website (76% for the major hotel brands). The hotel website has become the first, main, only and in many cases last point of contact with past, current and potential guests.

16Internet Effect on PricingLookers into Bookers Customize the online shopping experience. Guest Connect templates guide the flow of the booking process and enable the hotelier to incorporate the specific product elements that will best merchandise their property or chain from expanded property descriptions and rich images to dynamic packaging, promotionalpricing (with slash-through pricing), room preference selection, upgrades or links to a virtual concierge for additional services.

17Social MediaSet goalcommunicate to, or communicate with your guests and prospective guests?seeking fleeting fans or are you out to build long-term, lasting relationships with your customers?enhance the credibility and reputation of your brand?Promotion of the week?CRM platform?Commitment to Social Media Marketing (SMM involves participation, interaction, resources, commitment, follow-through, and time. 18Social Media contd. Social media should not be the anchor to your marketing planTeam effort Seek out the experts and observe19Start - Types of reservation systemsFranchisee hotel owner who leases a brand name and the benefits by:Management expertiseFinancial backingNational advertisingGroup purchasingReservation service

20Types of Reservation SystemsReferral Member of a Reservation Referral System - a worldwide organization that processes requests for room reservations at a particular member-hotel, is a hotel developer/owner who has access to the national reservation system15%-30% of daily room rentals vs. independent statusHilton franchise fees example (2009):Initial fee of $85,000 for first 275 guest rooms or suites plus $300 for each additional room or suite (min. fee to $75,000)5% monthly gross rooms revenue for royalty fee4% of monthly gross rooms revenue = monthly program feea monthly fee of 0.75 percent of hotel gross revenue is charged for use of OnQ proprietary business software and hardware systemPlus other fees for participation in Frequent Traveler/Guest Reward program, training, and computer system21Sources of ReservationsCorporate ClientsSecretaries ClubToll-freeReservation Referral ChainTravel AgentWeb sites (Expedia, Travelocity, of Reservations contd.Social/Military/Educational/Religious/Fraternal (SMERF)Provides opportunity to fill vacancies in low timesThese markets are price sensitive and time-relaxed and will travel accordingly.

23Sources of Reservations contd.Meetings/Incentive/Conference/Event (MICE)Need to locate large group of conference attendeesDetails: airfares, hotel rooms, room rates, food and beverage, cultural activities, etc.Cooperation of local tourism and travel association necessary24Sources of Reservations (contd.)Group travelersRefer to various travel directories used by hotels and potential guests as listed in the textGroup plannerBus association networkVirginia Bus AssociationPennsylvania Bus AssociationNational Bus AssociationTravel directories i.e. Hotel and Travel (refer to p. 139)Hotel Representative member of hotel staff who seeks group activity plannersHotel Broker person who sells hotel room prize packages to corporations, sweepstakes promoters, game shows, and other sponsors (with a discount)25Sources of Reservations (contd.)Leisure Traveler people who travel alone or with others to visit points of interest or relatives, or for other personal reasonsTravel agenciesToll-free numbersReservation/referral systemsInternetSocial Media Note Marriotts effort on YouTube being incorporated into the marketing efforts of this segment "Tweet Yourself to Hawaii" online campaign - best fan videos will be posted for public judging,Current Guests - an overlooked marketing opportunity

26Forecasting ReservationsRooms forecast refer to Figure 5-2 - (p. 141)Helps to p