This month, I have decided to break with tradition and write a column that doesn’t answer a specific question, but hopefully which answers the questions many of you may have. Whether you voted ‘remain’ or ‘leave’ in the recent historic referendum vote, it seems remiss for the occasion to pass unmarked by my column, especially given the inevitable consequences Brexit will have on the industry.
The historic and ultimately life-changing result was probably unforeseen by most, with expectation posing that we would ‘remain’, if nothing else to maintain the ‘status quo’ as is the result in the majority of referendums. Much was speculated about the effects of a ‘leave’ vote, but the lack of certainty meant that little, if any, practical advice was given to cover off the ‘what if’ scenarios we may face. So what can the industry expect?
I would be misleading you if I suggested that I am an expert in economics or Brexit, or that I can confidently predict what the next months and years will bring; however I am an experienced hotelier, have survived and thrived through my fair share of periods of political and economic unrest and have a flair for practical thinking. So here’s my practical guide to surviving the Brexit.
If the pound stays down…
Although a weak pound will negatively affect many businesses, it is likely to have a significantly positive effect on the UK tourism industry. In much the same way that we have spent many years enjoying cheap holidays to Europe (oh the irony), now many will have the option to enjoy cheaper holidays here. What remains to be seen is how big an impact there will be to our reputation as a result of the leave vote, but negative reputational effects are unlikely to be long-lasting, particularly with the anticipation of a lower-cost holiday. Similarly, a weaker pound will increase the cost of holidaying abroad, and current predictions suggest a renaissance of the ‘staycation’, which has been dwindling over the last twelve months or so.
Hoteliers can take advantage of the weak pound by:
- Joining their local Destination Management Organisation/Partnership (DMO/DMP) because they are:
- Responsible for much of the content promoted via the VisitBritain and VisitEngland platforms. This will help ensure that both your region and your business can take advantage of exposure to international tourists, particularly as focus shifts to new and emerging markets.
- Responsible for promoting your region and business within the UK, promoting you to potential staycationers, as they seek new and interesting places to visit.
- Joining a marketing consortium who work directly with potential holidaymakers, in the UK or abroad, to book your rooms. Unlike many of the OTAs, marketing consortiums will take a lower commission or add a mark-up, working to service their established relationships with tour operators. They work on the basis of power in numbers, creating a ‘one-stop-shop’ for potential guests, giving you more marketing punch. I personally work closely with Circle Hotels, although other providers are obviously available.
Even if the pound doesn’t stay down, there are huge advantages to the two approaches above, to directly and indirectly support your bookings.
Aside from this, business owners also need to take a moment to go back to basics, planning ahead now so that you are better able to navigate any turbulence. This means taking time out of running the business to focus on developing the business; revisiting past initiatives and identifying the successes, working out how you can better mine your existing database, considering your current reputation online and offline, and ultimately admitting where there is room for improvement.
There are too many marketing platforms to cover off in one column, however things you can consider doing are:
- Identifying ways to improve your reputation; if we return to a recession, it will be the best of the best who thrive the most, so identify any areas which need refurbishing, staff that need training etc.
- Revisiting your existing database and encouraging them to come back; valuable and relevant pullbacks can help deliver advance bookings, giving you a level of certainty for the coming months.
- Focussing locally; although you do need an external focus, nationally and internationally, developing a strategy to attract more local custom will have a quicker impact in the short term, while some of the other activities take effect.
- Revisiting your pricing models; let’s not be too hasty and suggest you need to lower prices to gain businesses, however reconsidering your pricing model will ensure you are prepared if things start to get quiet. If the last recession is anything to go by, people will be downgrading their budgets and expectations, focussing on practicality with a hint of luxury.
In times of uncertainty, I have always found three attributes to be the most effective; adaptability, honesty with yourself and careful, considered spending. These three ensure you have planned ahead for many scenarios, have the ability to quickly adapt and take advantage of opportunities, and ultimately offer a quality service that meets or exceeds expectations, helping to ensure you ultimate prosperity.
This feature first appeared in the July 2016 issue of Hotel owner.