Front Office Sales & Marketing

Professor um Hospitality
1. Dec 2020

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Front Office Sales & Marketing

  2. WHAT IS MARKETING? o Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives. o Marketing is the management process for identifying, anticipating and satisfying customers requirements profitability. o Marketing is always customer oriented. o Purpose is to create & maintain satisfied & profitable guests. o Guests come back only when their needs are met. o Guest satisfaction is the central goal to hospitality marketing.
  3. —Someone famous “It’s not your customer’s job to remember you, it is your obligation and responsibility to make sure they don’t have the chance to forget you.”
  4. ROLE OF FRONT OFFICE • Front office is the information source & request centre for guests & other employees • FO has become a order/ revenue generating department from an order taking department • FO also acts as Sales Department for the hotel • Equally helps in generating business & maximizing sale for the hotel • FO must keep accurate & latest records of guest history & room availability • S&M team need accurate figures to make strategies for future/ off season • S&M team need info on guest type/ origin to make marketing strategy & target key guest segment • S&M team always coordinates with FO with regards to room status in all terms
  5. ROLE OF FRONT OFFICE • Sell rooms to the guests who have not made prior reservation • Upsell room to the guest with an existing booking • Maintain the accurate inventory of products • Convey information to the guest about other products available for sale (Cross Selling) • FO is supposed to sell all available facilities at the hotel • Ensure maximum revenue generated not only from the sale of rooms but other revenue generating departments as well • Obtain feedback
  6. CORE CONCEPTS OF MARKETING NEED It is a positive, motivational factor that compels action for its satisfaction. It includes basic physical needs, social needs & esteem needs. An unfulfilled need is a driving force that stimulates the person to pursue & achieve it. WANT Want maybe understood as the way one express or communicates his needs.
  7. DEMAND Demand is a want that is backed by the ability & willingness to pay for the product. PRODUCT VALUE Value is the extent to which a good or service is perceived by its customer to meet his needs or wants, & when it is expressed in terms of money, known as price. A product is a good or service that is the end result of a proces & serves as a need or want satisfier. It is usually a bundle of tangible & intangible attributes that a seller offers to a buyer for purchase.
  8. SATISFACTION Satisfaction is an expression of a customer’s approval that a product’s performance meets his expectations. QUALITY Quality is the totality of features & characterstics of a product or service that bear on its ability to meet customer’s needs.
  9. MARKETING MANAGEMENT PHILOSOPHIES PRODUCT CONCEPT PRODUCTION CONCEPT SELLING CONCEPT MARKETING/ SOCIAL MARKETING CONCEPT The marketing concepts is the philosophy that urges organization to focus on their customer needs. Analyzing their needs & making such decisions that satisfy those needs in a better way than competitors.
  10. Sales concept focuses on the need of the seller. Marketing concept focuses on the need of the buyer. PRODUCTION CONCEPT means consumers will prefer products that are widely available & inexpensive. Concept concentrates on achieving high production efficiency, low cost & mass distribution. Assumption is customer is interested in product availability & low prices. PRODUCT CONCEPT will favor products that offer quality, performance, innovative features etc. Focus is on making superior products & improving them over time. Assumption is customer admires well made products & appraise quality & performance. Sometimes in this concept, managers forget about the market needs as they focus only on the products.
  11. SELLING CONCEPT holds consumer & business. If left alone, will not buy enough of selling company’s products. There should be aggressive selling & promotion effect. Their aim is to sell what they make rather than make what the market wants. MARKETING CONCEPT is the one which challenges all the other 3 concepts. The company goal consist of company being more effective than competitors in creating, delivering & communicating customer value to its selected target customer. Marketing concept rests on four pillars- target market, customer needs, integrated marketing and profitability.
  12. THE SALES & MARKETING CONCEPT Sales concept is preoccupied with the seller’s need to convert their product into cash. Marketing concept is preoccupied with the idea of satisfying the needs of the customer by means of the product as a solution to the cutomer’s needs. Sales concept focuses on the need of the seller. Marketing concept focuses on the need of the buyer. Marketing concept represents the major change in today’s company orientation that provides the foundation to achieve competitive advantage. This philosophy is the foundation of consultative selling.
  13. MARKET MIX ●Planned mix of controllable elements of product’s marketing plan; the four Ps- product, price, place & promotion ●The mix of these four form the core of marketing system ●Service marketing relies upon other three Ps; people, process & physical evidence
  14. The item actually being sold is the PRODUCT. It should deliver a minimum level of performance, other marketing mix wont work, even if the other three elements are best worked upon. PRODUCT Activities undertaken to make the product known to the user & trade. This includes advertising, word of mouth, commissions,& awards to trade. Also include consumer schemes, direct marketing, contests & prizes. PROMOTION The value that is set for the product. Depends on cost of production, segment targeted, ability of market to pay, supply-demand. PRICE Point of Sale. Catching the eye of the customer & making it easy for them to buy is main aim of “place” strategy. The mantra for successful business is “location, location, location” PLACE
  15. FRONT OFFICE & SALES MARKETING RELATIONSHIP •FO provides data on guest history •Information is based on zip code, frequency of visits, corporate affiliation, special needs etc. •FO makes the first impression on guests who are using the hotel for meetings, seminars, & banquets •Guest history helps S&M to target the specific market •S&M develop promotions, prepare mailing labels & select advertising media.
  17. GROUP MARKET MARKET TRANSIENT MARKET Corporate, Tour operators, meetings, conferences, seminars, leisure travel, Weddings etc. Business traveler, Leisure traveler
  18. The process of dividing a market of potential customers into groups, or segments, bases on different characteristics. Segments created are composed of customers who will respond similarly to marketing strategies & who share similar traits such as interests, needs or locations. WHAT IS MARKET SEGMENT?
  19. Corporate Market Tour Operators Meeting/ Conferences/ Seminars The group market segment constitutes the segments that provide high volume & bulk business to hotels. Corporate Market provides bulk & regular business. A contract is signed with the hotel. TAs purchase rooms in bulk at discounted price. & generate high volume of business. Group Market Segment Major market. Provide bulk business. Book rooms with conference halls, board rooms etc.
  20. Expositions- Trade shows & exhibitions bring together individuals & organizations associated with a common business for the purpose of reviewing, demonstrating, marketing & selling materials & product related to their common interest. Incentive Travel is the travel which is given to employees as reward for their performance. Hotels target companies who provide incentive travel to their employees. Transient Market Segment- They provide comparatively low number of room sales as compared to the group market. This segment includes business & leisure travel. Travel in small groups, less than 10 rooms.
  21. SOCIAL Weddings, Proms, Fund Raisers MILITARY Reunions, Award Ceremonies EDUCATIONAL Certification classes, Training, Convocations RELIGIOUS Enlightenment gatherings FRATERNAL Fraternities, sororities
  22. MARKET SEGMENT STRATEGIES UNDIFFERENT MARKETING STRATEGY •Market focuses on the common needs of the people •Goods & services are designed to satisfy maximum number of customers •Its not about grouping of customers or market segments •It relies on mass production, mass advertising, mass distribution •Principle of same brand, same price, same product, same packaging, same media, same marketing program, same advertising is followed for all customers in market •Also known as MARKET AGGREGATION STRATEGY •This is for product oriented companies
  23. DIFFERENCIATED MARKETING STRATEGY •Grouping of customers is done on the basis of their common needs & desires (region, income, age, education, personality, profession etc) •Whole market is divided into various segments •Different products are manufactured for different segments •Increases sales profit of the firm •Attracts large number of customers from all corners of society •Offers higher customer satisfaction by providing services as per the customers needs & desires •Also known as CUSTOMER ORIENTED STRATEGY OR MARKET SEGREGATION STRATEGY
  24. CONCENTRATED MARKETING STRATEGY •Concentration on one particular segment instead of various segments or entire market •Principle of one product & one segment is followed which created brand monopoly •This is best suited when new products are introduced in the market •All marketing efforts are concentrated on one segment •This leads to maximum customer satisfaction According to Philip Kotler, “Instead of going after a small share of a large market, the firm goes after a large of one or a few sub-markets. But another way instead of spreading itself thin in many parts of the market, it concentrates its forces to gain a good market position in a few areas.”
  25. DISCOUNT SELLING STRATEGY ●Target is money minded guests (middle class working people) ●Rooms are sold lower than the RACK rate ●Discounted rate is usually given to regular guests, TAs, groups, airlines etc. ●Discounted rates are mostly given during off seasons Further subcategorisation of strategies- STRAGEY FORMULATION FOR VARIOUS MARKET SEGMENTS PACKAGE PLAN STRATEGY ●Target is families/ leisure guests ●Travel for rest & recreational purpose ●Mostly prefered by Resort hotels ●Offer innovative packages on discounted rates ●Package costs comparatively lesser than each item paid for seperately
  26. GROUP SELLING STRATEGY ●Almost adapted by every hotel ●Attracts bulk business ●Generates huge profits ●Includes selling of N number of rooms to TAs at discounted rates ●Selling of rooms to corporates & FITs ●Discounted rate is offered STRAGEY FORMULATION FOR VARIOUS MARKET SEGMENTS BUSINESS FACILITY STRATEGY ●Commercial hotels mostly use this ●Target guest visit for business, meeting, conference, convention etc. ●Comparatively expensive hotels as they provide luxury accommodation ●Facilities like internet, FAX, computer, business centre etc. is also provided
  27. IMPORTANCE OF MARKET SEGMENTS HELPFUL IN COMPETITION Makes deep study of products, policies, strategies of competitors in all segments. Business enterprise can adopt different strategies for different markets taking into account the rival strategies. PROVIDING OPPORTUNITIES TO EXPAND MARKET By segmenting the market, a marketer can create new markets for their products TO DISCOVER MARKETING OPPORTUNITY Segmentation helps in making marketing research in all segments. Habits, taste, hobbies, nature of consumers of all segments can be understood deeply. Researchs help in discovering marketing opportunities.
  28. IMPORTANCE OF MARKET SEGMENTS KNOWLEDGE OF CUSTOMER NEEDS Segmentation helps in easily knowing why customer do or do not buy certain products or services. All activities are directed towards customer satisfaction. Segmentation helps in measuring each level of division of each segment. ADJUSTMENTS OF PRODUCTS Adjustment needs to be done according to the change in taste, needs, nature & income of the consumers. INCREASE IN SALES VOLUME Segmentation helps in increasing the sales volume. Each segment has different demand pattern & when the demand is satisfied by changing the products in different market segments, the total sales volume of an enterprise increases.
  29. IMPORTANCE OF MARKET SEGMENTS ADOPT SOUND & EFFECTIVE MARKETING PROGRAMME When customer needs are fully understood, market segmentation divides the whole market into several segments & individual marketing programmes are prepared for every segment. These programs are better & more effective than a single programme for whole market. EFFECTIVE ADVERTISING APPEAL Advertising appeals are designed in a way so as to create a positive image of individuals who use certain products. Message conveyed through these appeals influences the purchasing decision of different buyer groups. Different advertising appeals can be used for different market segments. INCREASE MARKETING EFFICIENCY Marketing efficiency is increased by offering specific pricing, sales promotion & distribution channels. Unique marketing strategies can be framed (product, price, ads, sales promotion, distribution channel etc) according to change in needs of segments.
  31. PHYSIOLOGICAL NEEDS Protection against heat, cold, rain. Special food. ECONOMICAL NEEDS Value for money spent by the guest SOCIAL NEEDS Attending functions, meet others, socialize PSYCHOLOGICAL NEEDS Enhancement of self pride Guest satisfactions ensures repeat business, increases clientele, & maximized revenue for the hotel. To satisfy the guests, their basic needs must be met & service must be coordinated accordingly.
  32. GUEST DISSATISFACTION The cause for dissatisfaction generally fall under two categories: UNDER THE CONTROL OF THE HOTEL (Unhelpful staff, cramped condition, lack of choice of product) BEYOND THE CONTROL OF FO OF THE HOTEL (Location, weather, other customers, transport problems)
  33. SELLING TECHNIQUES STARTING WITH RAPPORT -Use pace & lead -Make guests feel welcome & secure first -Advise guests in their best interest SELL THE WHOLE PACKAGE -Customers don’t just buy rooms, they buy hospitality, security, status & comfort -Manner & ability to build rapport will be powerful to sell total package to the customer -Describe services & facilities in what the guests might be interested in -Use appealing descriptive phrases when referring to rooms
  34. PACE THE TRANSACTION -Natural to ask the guest whether he wants to purchase or make a booking -Make it easy for the guest to take the decision -Put together the offer that meets his needs OPENING, DEVELOPMENT & DEALING WITH HESITATION (ODD) -Opening: informing about the rooms & services availability -Development: answering about the questions about the rooms & facilities, stressing attributes that are most likely to appeal to the guest -Dealing with Hesitation: dealing with the factors because of which the guest is unable to take the decision. One can offer the opportunity to inspect the room, might offer alternative options for the value for money.
  35. EMPHASIZING THE VALUE FOR MONEY -Justification to the guest for a upgrade -Justification for extra expenses by explaining the benefit gained by paying extra (Upsell/ when paying high rates) USE OF PRICE PSYCHOLOGY -Quoting a high priced options along with other alternatives may help the prices look better -Guests will feel they are getting superior quality, at a reasonable price OFFER LEAD IN ROOMS -Selling high or top down selling approach -Easier to convince the guest to consider superior, once the guest has already settled on a standard
  36. UPSELLING OF ROOMS •Convincing the guest to take higher category by paying more •The best time is during check-in & at booking stage •FD staff should be able to identify the guest who are willing to upgrade CROSS SELLING OF ROOMS •Selling related or additional products •Convinces the guest to add extras •Inform the guest about availability of added value facilities & services •Information about added facilities should be targeted to the guest enquiries or anticipated needs, in order to be effective
  37. REPEATED BUSINESS •Check out is the best time to boost up repeat business •Tentative reservation option to be offered if the guest is expected to come anytime soon •FD can provide brochure & business cards •Provide assurance of quick reservation anytime in future •Offer loyalty card membership to attract guest with benefits REFERRED SALES •Travel agents, tourist information centers, airport helpdesks etc can refer the guest to the hotel •Satisfies guest will also recommend another guests •Word of mouth is the best publicity of the market
  38. THANK YOU!