| How to increase international group sales? |
| Escrito por Pauline Biekens | |||
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There are no translations available. Hotel Presidente InterContinental Puerto Vallarta Mexico meeting the international group segment? By Pauline Biekens, Master student Innovative Hospitality Management, St. Ignasi Universitaria of Barcelona in Spain and the Hogeschool Zuyd of Maastricht in Holland. Puerto Vallarta August 2007 - Mexico receives more than 20 million business and leisure travelers a year, making the country one of the most important international tourism destinations worldwide. The meetings and conventions segment alone is a US$1.5 billion industry in Mexico. Mexico offers a remarkable variety of meeting options: 38 state-of-the-art convention centers in 25 cities, 26 destinations for incentive travel, 245,000 hotel rooms for conventions, more than 550,000 square meters of event space and 58 international airports. To see if Hotel Presidente InterContinental Puerto Vallarta can benefit from the above-mentioned factors the following research has been carried out. The research studies what changes in the current marketing strategy and product need to be made in order to increase the international group segment, both leisure and business. Changes in management, different sales and general managers of the hotel, and hotel concepts now result in a low average occupancy of approximately 45-50%. Lately not much effort has been made to attract the international group segment. In order to increase the occupancy generated from this segment there is a need to see what changes in the current marketing strategy and product need to be made to attract the international group, both leisure and business, segment. Keywords: Marketing strategy, Distribution channel, Marketing segment, Puerto Vallarta, Cross Selling Literature reviewMorrisson (2001) defines a marketing strategy as the selection of a course of actions from among several alternatives that involves specific customer groups (target markets), communication methods, distribution channels, and pricing structures. A distribution channel can be defined as a particular direct or indirect distribution arrangement used by a supplier, carrier, or destination marketing organization.(Morrison, 2001)P. Kotler (1998) describes a distribution channel as a set of independent organizations involved in the process of making a product or service available to the consumer or business user. A market segment is an identifiable component group of an overall market, whose members have something in common, and to which a specific service appeals. The term group can be described as follows; a number of individuals assembled together or having some unifying relationship. In this particular situation we speak about a group when the amount of rooms requested has a minimum of ten. The term international group refers to groups with non Mexican origin, mainly groups from the U.S. and Canada. Groups refer to small and medium sized board meetings, executive board meetings, leisure groups and weddings. Presidente InterContinental Puerto Vallarta is located on the West coast of Mexico and is part of the Presidente Hotel group that belongs to InterContinental Hotel Group (IHG). The current marketing strategy of the hotel is a concentrated marketing strategy. This strategy is similar to the single-target-market, except that a few additional segments are pursued. The single-market strategy is also known as "niching". Niching is using a strategy to appeal only to small or narrow target markets.In order to increase the occupancy generated from the international group segment there is a need to see what changes in the current marketing strategy should be made to attract the international group, both leisure and business, segment. The researchThe research has been structured via the design of several objectives and sub questions, which are listed below. What specific changes should Presidente InterContinental PV make in the current marketing strategy and hotel product for international groups in order to attract more international groups, both leisure and business? 1. To develop a procedure to optimize international group sales.
For obtaining answers to the above-mentioned questions the following methods have been applied. In depth InterviewsSeven Directors of Sales of Presidente InterContinental Hotels have been interviewed as well as a Business Development Executive of a local Destination Management Company. The population of the in-depth interviews is 8. Most interviews have been taken place over the phone due to distanced within Mexico. Data are recorded by note taking during the conversations and information has been processed by descriptive analysis. Surveys The type of questionnaire used is self-administered questionnaires. The questionnaires are delivered and returned electronically using the Internet site www.surveymonkey.com. In the questionnaires mainly opinion variables are used. These variables record how respondents feel about something or what they think or believe is true or false. The population of the survey are the contact persons of former international groups who held an event in 2005, 2006 or 2007 at the hotel from which contact information was available. The contact persons are either from a company or individuals. The individuals are people who held a wedding at the hotel. The sample size is 31. The survey research method has been limited by not having a proper database with past clients. Participant observationThe researcher has taken the role ‘participant as observer' while working in the sales department. Data generated from this type of observation are experiential data which are based on perceptions and feelings as you experience the process you are researching. Data collection and analysis have been part of the same process; analysis and collection of data are carried out simultaneously. Experiencing four kinds of tours referred by IVI, which is a destination Management Company in Puerto Vallarta, uses the role ‘complete participant'. Hours of operation, content, the attractiveness of the tour, capacity and language are noted during observation. Desk and field researchThe desk research consists of gathering information about Mexico and Puerto Vallarta. Furthermore information about (the current situation of) the hotel was gathered. This desk research also includes related theory on marketing and sales. In addition all competitor hotels have been visited and analyzed.Research resultsThe most remarkable trends concluded from the research, which are relevant for the hotel, are as follows:· Smaller and shorter meetings· More frequent meetings· Worldwide lead times are getting shorter· Customer's opinions. · Packages are popular· Investment in information and communications technology (ICT) by this industry will continue to accelerate. Unique Selling Points for the hotel are1. 4 Diamond hotel category with the personalized and authentic service because of the size of the property 2. Unique location 3. Size of the rooms 4. Frontal ocean view from all hotel rooms Competitive hotels have a much higher occupancy, broader food and beverage offer and all hotels focus on the national and International, Canadian, and US market. Hotel Presidente InterContinental Puerto Vallarta encounters a negative influence by the perception of guests that the hotel is located less convenient compared to competitor hotels. Major shortcomings towards meeting services and facilities compared with the competitive set are · Capacity of meeting space· Number of meeting rooms· Equipment and facilities such as wireless high speed internet availability Currently corporate sales office says that Presidente InterContinental Puerto Vallarta is more an individual hotel due to the size, the hotels sales office believes that the hotel has enough potential for small to medium sized groups. At this moment this strategy with corporate and the hotel does not match. Presently there is no structured program for cross selling among different Presidente InterContinental Hotels. All interviewees confirmed that this is a great opportunity for the hotels to increase business. First requirement is to create consistency among the hotels to be able to link information. Puerto Vallarta takes third place as a destination for U.S. incentive travel. It has a wide offer for International groups. Accessibility, surroundings, activities, gastronomy, nightlife and the ability to pay with US Dollars are factors that make the destination extremely attractive. Furthermore an ultra-modern convention center is current under construction that will more likely attract more international business. The survey results show that past customers are satisfied with the meeting facilities and services at the hotel. Besides 88.2 % (n=20) of the respondents would return to the hotel and 94.1% (n=16) of the respondents would recommend the hotel to others. Bulk buys; purchase incentives, and frequent buyer reward programs are all examples of business growth strategies for increasing sales in existing markets based on the general buying histories of customers. One regular customer is worth ten one-time buyers - or more. Therefore paying attention to existing customers is enormously important.F. Ruano, corporate Director of Sales Tour and Travel Presidente InterContinental Hotels points out that guest satisfaction programs, for example surveys are important when it comes to enhancing sales in existing markets. Alliances with third parties such as meeting and wedding planners and strengthen the relationship with DMC's and Wedding planners are good ways to increase sales in new markets.ConclusionsTaking the fact that the industry is shifting more towards small groups and meetings this can be considered in favor of hotel Presidente InterContinental Puerto Vallarta. This should give perspective for the hotel being a small property.The size of the hotel has both negative and positive influence. Because the core benefit for Presidente InterContinental Puerto Vallarta is the personalized service which is possible because of the size of the hotel. The current concentrated marketing strategy will be remained. This strategy is particularly effective for small companies with limited resources because it enables the company to achieve a strong market position in the specific market segment. It serves without mass production, mass distribution, or mass advertising. Taken into account that the hotel does not have much budget for making changes and / or investments in the product the market penetration strategy from Igor Ansoff is most suitable.Market Penetration Strategy focuses on increasing the market share of current products in the current markets. Hereby are three major approaches. Paying attention to existing markets is enormously important and valuable. Besides survey results show that past clients have had a good experience regarding the meeting facilities and services at the hotel. Central to any successful marketing strategy is an understanding of your customers and their needs. The ability to satisfy you customers' needs better than your competitors are able to can help you build customer loyalty and increase sales. The only constant in the world is change... · Presidente InterContinental Puerto Vallarta should update the Internet site in reference to the meeting and group facilities. As mentioned in the trends it is of extreme importance to have up to date information with attractive photos and offers. · Packages are gaining popularity in the meeting industry, which the hotel should consider as an opportunity to launch new meeting packages. My suggestion is to develop packages with leisure ingredients and focus on the well being of the mind and body. Besides the fact that ‘culinary teambuilding is in' can be an opportunity for Presidente InterContinental Puerto Vallarta to create workshops or cooking classes because the hotel offers very good food and beverage quality and with the current occupancy there is space and time for doing such cooking classes.· Flexibility regarding offering all-inclusive packages is very recommendable. From the writer's own experience by working in international group sales for the hotel as well as looking at the trends there are many requests from groups for an all inclusive package. The hotel is European Plan but should develop an all-inclusive package for groups as a concession and remain competitive in a destination with many all-inclusive resorts. · Internet and technology keep on gaining importance in the meeting industry therefore the hotel should install high speed internet in at least the meeting rooms and in the mean time as well other hotel areas. This is not a competitive advantage anymore, but instead a market requirement.· The hotel should focus on the strength of the ability to deliver personalized service to groups in comparison to hotels where several groups are managed at the same time and therefore less personal attention is possible. In large hotels groups tend to become a number instead of individual members.· Regarding distribution channels the hotel should make more frequent use of e-mail blasts. Given the relatively low cost of e-mail (postage and printing are free), every month the hotel should send an e-mail marketing program to their database. E-mail is the number one use of the Web; more than 80% of Web users list it as the main reason they go online. Besides e-mail's low cost, its offerings are more likely to be read. · Another recommendation is to invite several Key Account Directors to visit the property. This refreshes their minds and will benefit the selling of the property. Besides regular touch base phone calls can be made to strengthen the relationship, which is currently not done.· Communication and follow up with clients, among staff sales department and with corporate office needs to be more punctual and fast.· Devote one person completely responsible for international groups.· Level of English speaking people in the sales department needs to be improved· Create similar thinking and strategy together with corporate sales office and the hotel· Corporate office should develop a cross selling program linked to an incentive system. The foundation of every successful cross-selling program is rooted in a strong incentive system based on personal recognition and financial reward. (J. Boe, 2007). When developing this program, it is critically important that everyone in the company commits to the philosophy and fully participates in the program.· Frequent buyer program that stimulates repeat business for the hotel. Repetitive and consecutive business can be stimulated when special benefits are offered by booking two or more properties for consecutive years.· Implement the follow up evaluation form to evaluate customer satisfaction after staying at Presidente InterContinental Puerto Vallarta.· Change perception location. Make clear in publicity that the location of the hotel still is convenient even though is located in the south zone of Puerto Vallarta.· Update group information and banquet kit. This kit includes all information towards groups and all the food and beverage options for the hotel. To keep competitive with hotels in the destination this file needs to be renewed and posted online. As mentioned earlier nowadays people shop online and check out facilities and options you offer online. When the competition offers great packages and well organized information hotel Presidente InterContinental Puerto Vallarta cannot stay behind.· Use the VAT exemption program more frequent during the quotation process with international groups. This can save a lot of many for the group at no cost for the hotel. Just extra paperwork is required. ReferencesKandampully, J. et al. (2001) Service quality Management in Hospitality, tourism and leisure, Haworth Hospitality Press, NY.Saunders, Mark & Lewis, Philip & Thornhill, Adrian (2003) Research Methods for Business Students, third edition Prentice-Hall, Upper Saddle River, NJBrinkman, Joep (1998), Cijfers spreken, Wolters Noordhoff GroningenMorrison, Alastair (2001) Hospitality and Travel Marketing, third edition, Thomson Delmar Learning USAKotler, Philip, Bowen, John, Makens James (1998) Marketing for hospitality and tourism, second edition Prentice-Hall Upper Saddle River, NJDavidson, Rob (2003) The EIBTM 2003 Industry trends and Market Share ReportAnderson, Eugene & Sullivan, Mary (1993) Marketing Science, volume 12, no 2Ward, S. (2006) Increasing Sales in existing marketsWard, S. (2006) Ten low cost ways to promote your businessKahle, D. (no date), Try a sales blitzBoe, J. (2007), Cross-Selling takes teamworkCollins, T. (2007), Not your typicalVerikios, Michael (2006) MICE Industry trends and marketsFoy, Kelly (2007) Elite MeetingsReeves, Rosser (1961) The reality of advertisingDemchak, Casey ( no date ) Essential Sales Writing Secrets Tourism board Puerto VallartaThe Ministry of Tourism of Mexico: SECTURThe Mexico Tourism Board: CPTM http://www.plunkettresearch.com http://www.world-tourism.orghttp://en.wikipedia.org http://www.sectur.gob.mxhttp://www.state.gov http://www.worldbank.orghttp://www.jalisco.gob.mx http://sbinfocanada.about.comhttp://www.visitmexico.com http://www.ihgplc.comhttp://www.mpiweb.org http://elitemeetings.net/http://www.booksgoogle.com http://www.vallarta-info.comhttp://www.puertovallarta.gob.mx http://www.puertovallarta.nethttp://www.businesslink.gov.uk http://www.virtualmex.com/general.htmhttp://www.visitmexicopress.com http://www.hotelexecutive.comhttp://www.ehotelier.com http://www.hotelmarketing.comhttp://www.site-intl.org http://meetingsnet.comhttp://intercontinental.com http://www.acquaesencia.comhttp://www.hotelmotel.com http://www.tropicalincentives.comhttp://www.vallartaonline.com http://www.salesandmarketing.comhttp://www.12manage.com www.answers.comhttp://www.meetingsmexico.com http://www.hotelschool.cornell.eduhttp://ub.unimaas.nl http://ru.nl/ubn http://www.visitmexicopress.com/newsletters/SeptOct/pressspr1.htmlhttp://www.tia.org Travel Industry Association of Americahttp://www.toolkit.cch.com/text/P03_8060.asp About the author: Pauline Biekens has a Dutch nationality, 23 years old, graduated from Hotel Management School Maastricht in 2005 and currently Master Student of Innovative Hospitality Management. She has experience in working for hotels in South Africa, USA and Mexico. Contact details: Esta dirección electrónica esta protegida contra spambots. Es necesario activar Javascript para visualizarla
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