Commoditization is an ugly word to me, especially when it comes to the service industry! Whether it is my business or our hotel partners’ business, I know the last thing I would ever want is to be perceived as a commodity!  In business, commoditization is the movement of a market from differentiated to undifferentiated.  When this happens, products become more similar from a buyer’s point of view, and pricing power is weakened.

Sounds dreadful, right?  Who wants to be lumped together with everyone else and forced to price similarly to everyone else?  It’s not a fun game.  Take it from a girl who grew up in farm country, with corn, cattle, and soybeans…  I can still hear “the commodities report” playing on the radio every morning.

I digress.

It is my mission to help hotels break free from being perceived as a commodity by their customers.  One would think it would be impossible to become commoditized when hotels are offering both a service-based, and experience-based product…  Right?  Additionally, the brand managers and marketers spend countless hours and tons of money to differentiate their brands and hotels!  I mean… We have lifestyle hotels, people!

In hotel sales we do not control a lot of things that happen behind the scenes in brand development & strategy, but there are some key areas we can control, that ensure you do not fall into the commoditization trap that buyers may set for you.

Here are 3 reasons your hotel could become a commodity:

1. Your sales team is reactive vs. proactive: If you’re waiting for RFPs to come to you rather than proactively seeking new business opportunities, you are inviting customers to look at you from the same lens as everyone else.  Likely, the buyer has already done some research on their own, and chose a handful of hotels they feel fit their needs.  More often than not, price is a factor in their solicitation and you’re property is comparable with everyone else.  Alternately, if you were to proactively seek out new business opportunities and find a prospect before they are soliciting RFPs, you have a greater chance of differentiating yourself and your property!  In many cases, you can even eliminate some of the competition!  So many hotels I speak with have not figured this out, and every day they are reacting to leads that are also talking to every other hotel in their market, and they are simply stuck playing the rate game.  Stop!!!  I mean… You can keep responding to those leads and hope for the best, but start finding your own leads and create your business success.

2. Your offer is too “vanilla”: The vanilla flavor kind of gets a bad rap, doesn’t it?  I love a good rich vanilla ice cream treat, but if I put it in context of my 3 and 5 year old…  I’ve NEVER once heard them scream from the rooftops with gusto that they want VANILLA!!!  Nope… They only scream for chocolate, strawberry, or some other crazy flavor.  It’s kind of the same thing.  What are you doing to make your offer stand out and get the prospect to “scream from the rooftop” that they want to contract with your hotel?  My dear friend Ciara Feely Cahalane is an expert in creating proposals that are meaningful and stand out from the crowd.  She’s spent countless hours speaking with and interviewing some of the top meeting planners around the world.  If you want to know how to de-commoditize your offer, connect with Ciara!

3. You don’t know your audience: Part of the reason the offer doesn’t compel the buyer to look at your hotel as special, is because you don’t know them.  You never spoke to them.  You never broke through the noise and got their attention.  We can use all the excuses that we want about buyers creating this transactional approach by submitting RFPs through third party sources and whatnot, but hotel sales has the power to change it.  I guarantee those hotels that are already winning more business have changed it for themselves.  Do not blindly respond to an RFP.  Do your research, learn the triggers and sticking points for the buyer, understand their business, and then tailor the offer to them as best you can.

It’s all about differentiation and protecting your hotel from being lumped in with everyone else, or commoditized (yuck).  As sales professionals it is completely possible to differentiate even the most basic box hotel through perseverance, creativity and authentic sales.  I have met many stellar sales managers that did phenomenal things for hotels that from the outside looking in didn’t seem to have a lot of differentiation, but they found a way by taking a no excuses approach.

I’d love to hear your stories about how you’ve differentiated yourself and your hotel from the competition.  What do you feel you can do better, or we as an industry can be doing better?  Please leave your comments and feedback below…

Or, if you would like to connect and see how Plan B Consultants, Inc. or Sales4Hire™ can make an impact on your hotel sales success, CLICK HERE to schedule a free, no obligations call.