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Need PR and Marketing Help? Ask Away! Q& A with Jennifer Rodrigues of TravelInk’d

Aug 9, 2010

Monday, August 9, 2010

By Jennifer Rodrigues

The Cornell Center for Hospitality Research released a report last week indicating that takeovers and acquisitions of hotel properties are once again on the rise, with the majority of the activity predicted to center around large hotel companies and relatively small real estate investment trusts (REITs). This is a significant turnabout from 2008 and 2009, as the lodging sector experienced the ravages of the recession and very little consolidation took place, but not quite a return to the M&A heyday of 2004-2007, a period that recorded the highest number of mergers and takeovers in the history of the hospitality industry.

This report is good news, for the most part. It signals a return of the flow of capital into hotels and hotel ownership groups across the world and indicates a loosening of credit conditions. But it does raise some interesting questions from a marketing and public relations point of view. How, exactly, should a hotel undergoing a merger market itself? How should it handle PR during what could be a turbulent period of adjustment? Can a hotel maintain its conversation with its guests as it changes ownership?

If we (as an industry) are to believe the analysis of the Cornell Center for Hospitality Research- and I do- then more hotel marketing departments, GMs and new owners will find themselves asking these questions in the coming months. In an effort to be prepared, here are some of the most frequently asked merger questions and answers.
 

Q: Our property is part of a large hotel group currently merging with another ownership group that plans to make management changes. We anticipate the marketing department to be left mostly in place, but how can we tweak our strategy to effectively market the transition?

A: This is probably the most pressing question for marketers during a merger or acquisition. Whatever strategy is currently in place cannot address the changes that a merger or takeover will bring, yet a total overhaul of the hotel’s marketing vision is both unfeasible and unadvisable. The best course of action is to specifically address the merger within the framework of your current marketing strategy. There are a few rules to follow here:

• First, highlight the benefits of the merger. Without divulging too many details, outline how the cost reductions the merger/takeover will bring and how they will positively affect consumers (lower rates, streamlined service, etc.). Or, if a capital infusion is the main benefit of the acquisition, emphasize the improvements the influx of cash can facilitate. There is probably a very good reason for the merger/acquisition/takeover so don’t be afraid to shout it from the rooftops.
• Second, embrace the idea that the people running the hotel are the hotel. Line level employees are unlikely to be immediately replaced during consolidation and it is their interactions with guests that make up the entirety of the hotel experience. Also, hotel staff can be the best ambassadors of change and if they’re convinced that the merger is a good thing, your customers soon will be as well.
• Third, reinforce the fact that though there will be some change, it is an evolution, not a revolution. The majority of hotel business will be conducted as usual. Guests worry more about the service they receive than the ownership group or management company that is providing it.
• Lastly, conduct all of this communication often and as openly as possible. Don’t attempt to conceal or spin the news that anyone who reads the Wall Street Journal already knows. Don’t let long periods elapse before addressing the change in your marketing materials or in your PR efforts.

 

Q: The REIT that owns our property is being bought out, but the management company that operates the hotel will remain the same. This means there will be virtually no impact on our guests or our staff, but the news of the takeover is all over the trade and business media, and we feel we should address it. How can we do this?

A: Change is inevitably accompanied by some uncertainty on the part of both staff and customers. One of the unique aspects of the hotel business is that the real estate dealings that are an integral part of the financial side of the business sometimes have nothing at all to do with the operations of the hotel. In this case, reiterating the fact that guests will continue to experience the same levels of service by the same staff in the same physical property with the same amenities should go a long way toward allaying your customers’ fears. The best advice in this situation is to get out in front of the story, before uncertainty has a chance to take hold. And make sure your frontline staff is aware of the change and trained to respond to questions appropriately.

If your hotel is currently undergoing a merger or anticipating an acquisition, I’d love to hear what marketing tactics you’re using to deal with it and what message you’re sending to your clientele. And of course, if you have questions about the best way to handle your specific situation, don’t hesitate to contact me at any time – jlr@travelinkd.com.
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Did this information help you? If you have other questions, I’d love to hear from you – please don’t be shy! Send an email to jlr@travelinkd.com.
And don’t forget to check back twice a month for more PR and Marketing Q&As.

About Jennifer Rodrigues

Jennifer Rodrigues, Visibility Development Manager with ThinkInk and TravelInk’d, is a seasoned public relations professional with a passion for the hospitality industry, which is expressed in her role at ThinkInk’s travel division, TravelInk’d. At TravelInk’d, she is responsible for developing cost-effective and creative public relations and marketing strategies for clients in the travel and tourism, airline, lodging, cruise and meeting/event sectors. For more information on TravelInk’d, please visitwww.travelinkd.com or contact Jennifer at jlr@travelinkd.com. For more news about PR and marketing in the travel industry, follow TravelInk’d on Twitter @TravelInkd and visit the TravelInk’dFacebook Fan Page.

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