Preparation is the foundation of opening-day success

Abstract

A few weeks after a franchise contract, membership agreement or management contract is signed, a new hotel opens, or a reflagged property welcomes guests under a new name. One of the most important aspects of a property opening or reflagging is the amount of free publicity such an event can sometimes generate through the local media, sources said. To draw those guests when a property opens, marketing of the property should begin as early as a year before the doors are opened.

A few weeks after a franchise contract, membership agreement or management contract is signed, a new hotel opens, or a reflagged property welcomes guests under a new name.

The franchise company promises a good delivery of business via the toll-free reservation system, but that method is not likely to deliver the bulk of guests needed for a hotel property to service its debt and turn a considerable profit. Eventually there will be numerous sources of guests, including satisfied customers who return to the property. But in its early weeks, hotels can't count on return business.

One of the most important aspects of a property opening or reflagging is the amount of free publicity such an event can sometimes generate through the local media, sources said. The smaller the town, the more likely a clever entrepreneur can turn the opening ofa hotel into a community event by attracting customers that will pay off for years to come.

Keith Pierce, president and c.e.o. of Wingate Inns International, said the more people an owner or operator can get to know in the local community, the better it will be for the property in an increasingly competitive market.

"Given that our properties are all new construction and the relative [newness of the chain], many of these first guests might be stay ing at a Wingate for the first time," Pierce said. "It becomes extra important to create favorable impressions that will benefit other Wingates."

Pierce said he puts regional directors in the field who help the owner and the operations team learn the basics of operating a hotel and lure customers through the door. Between three and four months before the scheduled opening, a pre-opening market review is conducted to determine where the first guests are likely to originate from, he said. Wingate helps the property develop an advertising plan, hire a director of sales and build a database that includes all possible sources of business.

"Our owners and propertymanagement teams are encouraged to become involved in the local community and become well known in the area," Pierce said. "Local businesses, chambers of commerce, community leaders, social organizations and convention-and-visitors bureaus are all sources of guests, and they must know about the new Wingate in the area."

Wingate schedules soft openings so that the operations team can work out kinks at a property before the grand opening. But a grand-opening party is a good way to bring in those community leaders who already have been contacted to give them a tour of the property, Pierce said.

He said he would prefer that newly opened Wingates not drastically slash rates in order to score huge occupancies in the early days of existence.

"We want these guests to be our customers for the long term, and starting at a rate much below what they will pay in the future is not a good plan," he said.

Felix Madera, vp. international for Sonesta Hotels, Resorts & Nile Cruises, said the main function of his company is to see that everything a hotel requires is fully functional and in place before the first guest arrives.

"Sonesta prefers to be part of the planning process right from the beginning," Madera said. "Our experience makes it possible for us to understand all of the needs of not only guests, but also the staff, and we can see to it that such needs are taken care of in the original plan."

Madera said attention to detail makes it possible to attain the highest possible occupancy in the early days of a hotels operation.

"We're very concerned about the well being of the employee because that is an important part of what makes a new hotel run properly," he said. "We do our best to make it dear that a properly run hotel operation needs everything in place to please guests and employees."

Strategic planning

To draw those guests when a property opens, Madera said the marketing of the property should begin as early as a year before the doors are opened.

"We use lots of marketing tools, including image advertisements, distribution of collateral material, direct mail and word of mouth," he said.

Sonesta will construct mock guestrooms so potential customers from the community will be able to see what a Sonesta guestroom will look like and what amenities the property will offer.

"You want the hotel to open right," Madera said. "The last thing you want is for a guest to have a bad experience at a brand new hotel."

Gene Kordoban, partner/director of membership development at Best Value Inn Brand Membership, said Best Value sets in motion all of its operational support for a new property or one that is converting to the Best Value system.

"We like to call it `jump-start support' so that whatever the experience level of the owner and those operating the property, the new member of our system is not crawling when our sign goes up," Kordoban said.

Best Value provides new properties with a resource guide so owners are completely familiar with all that the brand offers.

"We offer sales support, outline sales strategies, give them access to our vendor-support programs and make the necessary visits to the property to assure it is going to do as well as possible as soon as it opens as a Best Value," Kordoban said.

Bringing a conversion into a system means that a property has customers who need to be notified of the change taking place at the property, and in the case of Best Value, an independent property is allowed to keep its former name.

"We guide the owner about the best way to contact former guests and make contacts in the community that have not been made before," Kordoban said.

Kordoban said Best Value sees nothing wrong with offering a grand-opening rate that is below what the property eventually wants to achieve in a given season.

"You must win guests from the competition, especially in the beginning, and sometimes a lower rate is the way to achieve that," he said. "Coupons, special discounts and offering premiums are good ways to attract guests when the property starts running."

Kordoban also emphasized the importance of measuring the reaction of those first guests to stay at a property.

"Guests really appreciate having input, especially when they know a property is new," he said. "A good plan for measuring guest satisfaction can make a guest feel special because [the guest] is in on the ground floor and can help a property be successful."

John Synstegaard, vp. franchise services at AmericInn International, said AmericInn offers plenty of marketing and operational support to new properties to ensure success from the outset. Starting about 90 days before opening, the new property's g.m. begins visiting other AmericInns to gain first-hand experience.

"We stress training preparedness and experience, and we are there to help the owner with everything," Synstegaard said. "Well design marketing collateral free of charge for individual properties, and we instruct the property's new employ ees how to market the hoteL"

Synstegaard said AmericInn also stresses the importance of making the property and its staff well known in the local community.

"We teach them and help them go out into the market and develop business contacts," he said. "We also encourage development of a competitive analysis so they know [what competition they are up agst]."

Synstegaard said AmericInn encourages a soft opening to precede the grand opening.

"We do what we can to help bring in the business, and we teach the owner what can be done at the local level," he said.

Pierce said there is nothing like success when a property first opens.

"You want to open with as many heads in beds as possible," Pierce said. "Still, you can't look at only a day's, week's or even a months performance. The property might even be opening in a soft season. Wingate is in there with its support for the long haul."