That is one of the conclusions hospitality marketing professionals took away from a recent presentation by Peter Yesawich at a hospitality marketing conference last weekend at The Homestead in Hot Springs, Virginia.

But don’t despair.  There is still hope for some hoteliers.

Peter was presenting the 2008 Y Partnership/Yankelovich Monitor research when he showed a chart indicating “Airline Brands” no longer matters to 51% of leisure travelers – an all-time low.   That’s down from 57% in 2006 and expected to crash below 50% for the first time when 2009 study results are published.

Why?  Lack of differentiation, increasing price sensitivity on the part of travelers and the introduction of comparison shopping web sites like Kayak and SideStep.  The industry that pioneered loyalty programs is becoming a commodity – much to the chagrin of the airlines, their marketing departments and ad agencies.  Brand differentiation and loyalty are declining rapidly.

The same forces are at work against chain hotels as they too are becoming commodities.   With increasing “sameness” the chains will be left to compete primarily on price.  Anybody see Hilton’s announcement on Monday saying they were reducing the price on all rooms by 20%?

Now For The Good News!

There is a silver lining in this story and it pertains to smaller independent luxury hotels – those hotels that offer guests a truly unique experience – an experience discerning travelers are willing to pay a premium for.  These are the hotels that can effectively resist  becoming a commodity.

But it is only an advantage if you capitalize on it.  You can by developing a strong, benefit oriented positioning and do everything in your power to continually strengthen your brand.  Make sure your hospitality marketing team understands your brand and communicates it effectively across all messaging.  Create an integrated customer relationship marketing (CRM) program and nurture your guests and prospects through communications the same way you do on property.

Create Brand Advocates.  Nurture every guest before, during and after their stay. 

Small independent luxury hotels have never been in a better position to compete against the chains.  Take advantage of it while you can.

What do you think?  Safe Travels – Madigan Pratt

AUTHOR: Madigan Pratt

Madigan Pratt is President of MP&A Digital & Advertising, an award-winning agency helping luxury hotels attract and retain profitable customers. Principals with over 60 years of collective experience at some of the world's largest advertising and direct marketing companies lead the agency's team of marketing, creative, public relations, Internet and social media professionals.

4 Comments
  • Interesting Blog. Guests in the luxury demographic are looking for quality. Quality facilities, quality service and they can no longer rely on “brand” to provide them with the quality product they are seeking because of the commoditisation of the hotel product. For this reason todays guests don’t particularly care which brand the hotel belongs to, they care about the quality of the product the hotel is providing. For a long time now I have been amazed at the very large sums of money hotel companies spend on marketing their brands, while at the same time they have gone to great lengths to make the actual product virtually indistinguishable to their customers. They would be much wiser to spend the money improving the quality of service experienced in their hotels, to focus on quality, rather than waste it on brand promotion. People don’t believe the “talk”, they believe the “walk”.
    The Appraiser
    Hotel Evaluations

    April 1, 2009
  • Interesting Blog. Guests in the luxury demographic are looking for quality. Quality facilities, quality service and they can no longer rely on “brand” to provide them with the quality product they are seeking because of the commoditisation of the hotel product. For this reason todays guests don’t particularly care which brand the hotel belongs to, they care about the quality of the product the hotel is providing. For a long time now I have been amazed at the very large sums of money hotel companies spend on marketing their brands, while at the same time they have gone to great lengths to make the actual product virtually indistinguishable to their customers. They would be much wiser to spend the money improving the quality of service experienced in their hotels, to focus on quality, rather than waste it on brand promotion. People don’t believe the “talk”, they believe the “walk”.
    The Appraiser
    Hotel Evaluations

    April 1, 2009
  • I think this is so true. The integrity of the brand and it’s values are the key to success and longevity. Spend less on marketing, and let your customers do the work with blogging, tweeting, etc. If you have a well defined and executed product, it will be evident and worth talking about. Most people scour the web anyway to find out which brand and/or company is best. Since there are so many travel and hospitality sites and blogs out there, let them do the “talking” while you do the “walking” as Hotel Evaluations mentioned. Knowing what the hospitality companies budget for their marketing, imagine what that money could do if used towards a better and more interactive website and a unique and luxurious experience for the customer. I think we will begin to see a trend in this direction soon.

    June 29, 2009
  • I think this is so true. The integrity of the brand and it’s values are the key to success and longevity. Spend less on marketing, and let your customers do the work with blogging, tweeting, etc. If you have a well defined and executed product, it will be evident and worth talking about. Most people scour the web anyway to find out which brand and/or company is best. Since there are so many travel and hospitality sites and blogs out there, let them do the “talking” while you do the “walking” as Hotel Evaluations mentioned. Knowing what the hospitality companies budget for their marketing, imagine what that money could do if used towards a better and more interactive website and a unique and luxurious experience for the customer. I think we will begin to see a trend in this direction soon.

    June 29, 2009

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