You can also find out more about the HSMAI Commercial Strategy Conference Stephanie Smith, of Cogwheel, spoke on June 17 to try and change the mindsets surrounding how most hotel marketing budgets have been created.
There are three different ways to set up a marketing budget for a hotel:
1 – Too Little – Take last year’s budget and add 10%
2 – Too Much – Take your top line forecast then budget 3-8% towards marketing
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3 – Just Right – Follow the following steps to property justify a targeting hotel marketing budget
How to Create a Budget for Hotel Marketing
If you do not follow this framework, as a commercial hotel team, then you will never solve problems or achieve team goals. If we don’t, then we will be left with trying to stretch our dollars too thinly over a variety of tactics.
1 – Define Gaps and Goals
2 – Determine a Strategy (as a team)
3 – Solve with Specific Tactics
4 – Allocate funds and budgets
Stephanie then walked us through six different scenarios of commercial strategy and how we can plan for them in marketing. These gaps or goals represent sales or revenue issues that hotel marketers must plan to solve.
Each scenario is a walk-through of the above steps to demonstrate how different strategies or budgets could be used in order to solve specific gaps or reach certain goals.
- Scenario 1 : Our market is saturated with hotels that are the same brand. We don’t get our fair share
- Scenario 2 : The group PACE has been reduced, and we now rely more on transients in certain quarters
- Scenario #3: Market demand is softening, all are fighting for the same businesses
- Scenario #4: We recently rebranded a hotel. RAMP has been slow. No one knows the new name.
- Scenario 5 : We are in the middle of the monthly budget and will not be able to make it.
- Scenario six: The profit is low because of OTA commissions.
Review the entire deck to see the sample tactics, strategies and budgets that were used to solve these scenarios.
HSMAI_Indianapolis_Cogwheel_Marketing
Last but not least, there is a chart that shows digital marketing KPIs – not just ROAS – and a cheatsheet to align the customer experience funnel with their aligned strategies, KPIs, and costs.
