Sales Vs Marketing: The Rise of the Marketers

I believe sales and marketing departments are at a pivotal moment in hospitality: the rise of the marketers. Or to be correct, we should be at a pivotal moment and yet, hotels seems to struggle to acknowledge a transition is happening.

For anyone familiar with the hospitality industry, we all know it is a slow evolving beast where changes take time. Revenue management was introduced in the 70s in airlines and only arrived in hotels in the 90s, quite a few hotel chains still struggle with complicated and outdated reservation and on-line reservation systems, working with OTAs still carries a negative perception, and getting hotels to switch their marketing budget from magazines to on-line is still a battle fought in many hotels in the world at the moment.

Now take a look at your hotel, go look at your numbers and have a look at where the bookings are coming from. What share of your daily room business is coming from your brand.com? From OTAs? From GDS? From wholesalers with a direct connection to your system? Chances are we’re talking about a significant part of your business, right?

I worked in or with quite a few hotels over the last 7 years, every time with a focus on growing sales on digital channels and the trend is always the same over the +100 hotels I’ve dealt with: digital sales have evolved to account for more than 50% of the hotel rooms sales. Whether we’re talking about 4 stars, 5 stars, luxury, resort or city hotels doesn’t really matter, the share of each channel will differ for each hotel but the result is the same: more than 50%, sometimes 60 to 70% of your room revenues come from on-line sales.

Now let’s take a look at your sales and marketing team on property. I’m betting you have a director of sales and marketing (DOSM), with a strong sales background, overseeing a team of sales talents; then a marketing team within that team that is probably half as populated compared to your sales team and with a marketing manager, or at best a marketing director in the luxury segment.

I believe it’s time to evolve and adjust our sales and marketing teams to what our data is telling us. You need a strong sales team to work on your contracted business, on your event and catering business if that is what your hotel is focusing on, no question there. You can’t replace the sales person personal contact when it comes to sealing a deal in those cases. But you need strong marketers to increase the revenues coming from those digital channels, and if your business is mainly coming from these channels you need to give the driving seat to a leader with that strong marketing knowledge.

DOSMs with sales background rely on their marketers to execute brilliant marketing strategies, the opposite is perfectly conceivable and if you’re a property leader, you should be thinking about it. If over the last 2 to 3 years, at least 50% of your room revenues has been coming from on-line sales which your marketing team is responsible for, my advice is to consider a profile with a stronger marketing background for the next Sales and Marketing leader.

I’ll even go further: look at your food and beverage revenues and consider how important it is in your hotel share of revenues, how many of these covers are outside guests, do you have outlets serving a majority of outside guests? How are you doing on the on-line booking space with your restaurants?
If to some or most of these, the answer was “a significant part”, then you have to consider leading the sales and marketing efforts from a marketing perspective rather than a sales one.

Long gone are the days where independent travelers were the exception and most of the business required the sales team to get a contract with a wholesaler, a company, a tour operator, … we live in a world of dynamic pricing where rate parity is forcing us to automate most of these processes.

The balance of “power” between sales and marketing in our organizations has evolved and hotels must evolve with it, understanding how marketing, digital marketing, reputation management and loyalty are now the driving forces of our business, and the need for leaders equipped with the knowledge and experience of these “new” channels, to reach out to guests where they are, and drive revenue from where the money is.