With the trend now moving towards guests looking for more memorable experiences rather than pure price incentives, hotels are now focusing on offering more unique products to capture the festive market By Kahini Chakraborty
Making its mark as a premier ‘Land of Festivals’, India’s essence lies in the assortment of different ethnicities that dwell in here. The festivals, not sprinkled evenly in the calendar, starts from mid August-September and continues until December. Some festivals have various legends attached to it that differ from one region to another. In such a scenario, India and how Indians do business is constantly changing and evolving with the emergence of e-commerce and this has kept the hotel industry on their toes to develop new strategies around it. According to Kumar Shubham, director of sales, Courtyard by Marriott Gurgaon, “Festive season in India starts from Dusshera to Diwali and ends with New Year. Like any other country this period is still a family affair and this has a straight impact on business travel. Being a business hotel we find that most of the corporate offices are closed during these festive days and especially if these days fall around a weekend; we see a decline in hotel room business. This trend is observed across all our brands in city destinations. However there is an upside to the restaurant and banquet sales as most people step out to celebrate with friends and family.”
As festivities differ a lot depending upon the geographical locations, what are the ‘push and pull’ strategies being adopted by hotels? Shubham states, “Tier I cities or metros need more focus with constantly evolving marketing activities to keep customers engaged and enticed. The attention span of today’s smartphone generation which is also our target audience is very low and hotels need to continuously innovate and evolve to stay focused. Tier II cities are still very traditional and they prefer local marketing rather than innovation in hotel offerings. We plan our marketing strategies for the hotel a year in advance and action plans are drawn closer to the dates as per the prevailing market conditions and demand. During this period we market family time and celebration with near and dear ones as we seek opportunities in the domestic market.”
Calling for marketing strategies of hotels to be reoriented towards the changing market dynamics to tackle the intense competition, Amit Agarwal, senior marketing manager, Hotels.com highlights, “Hoteliers and OTAs having understood this, are focusing on retaining customers apart from finding new ones to keep the momentum going. In order to achieve this, hotels and travel portals are now focused on developing innovative and competitive marketing strategies which seek new ways to acquire, retain and increase customers, thereby sustaining and developing in this competitive era.” The hotel industry is now adopting new technologies such as customer relationship management tools to push their business. Experts in the industry opine that marketing strategies are determined by various factors such as product diversity, quality, market segment, marketing channel, geographic area covered, branding, etc. It also depends on the development of new products, hotel’s positioning in the market, innovation and pricing policy, relationship with customers, partners, suppliers and competitors. Apart from this, strategies also consider the marketing complexity, stakeholders’ and customers’ expectations, and dynamic external and internal environment.
From a tourism perspective, HolidayIQ’s recent report – HolidayIQ Insights: Festival Tourism, states that international holiday preferences are growing by 30 per cent, which reveals that the top 10 international destinations including Singapore, Dubai, Maldives, Bhutan, Thailand, Mauritius, Sri Lanka, Bali, Malaysia and Australia may beat domestic holiday this Diwali since it is a long weekend. Hari Nair, founder and CEO, HolidayIQ states, “Indian travellers are holidaying like never before and festival tourism has taken off in India. Every possible occasion is now a reason to travel. Generally, a holiday is planned 30 days in advance, however, on HolidayIQ we see people starting holiday research for the festive season very early, as early as 90 days before the trip to capture the best value for money and hotel availability in sought after destinations. Till a couple of years ago festival celebrations were limited to family homes, today the entire family travels together for the celebration. This year another trend is the popularity of mobile apps and extent of research. There is close to 300 per cent increase in people reading reviews before making a hotel booking and over 75 per cent research is done via mobile devices.”
“These days the traditional ethos of festivals are no longer as strong. Yes, Diwali means family but it also means time together. With so many nuclear families and the increase in domestic travel, this season should definitely see an upturn in domestic travel. The long weekends that come with the festivities also fuel the desire to travel,” opines Mansi Bhatnagar, managing director-marketing communications, HVS.
Product and promotion
Marketing is the essential tool for success of a business, large or small, with its primary focus on quality, consumer value and customer satisfaction. A strategy commonly used is the marketing mix. This tool is made up of the ‘Four Ps’ of marketing- product, place, price and promotion. Mixing these variables together produces results needed to achieve in specific target markets.
Varun Mehrotra, director sales and marketing, Fairmont Jaipur highlights that everyone wants to use the opportunity to make more revenue and festive time is one of the important periods to generate additional revenue, same can be from rooms/ F&B. “Trends are changing, and rather than coming up with discounts or offers, hotels are focusing more on experiences and unique products to capture the market,” he points out. “During the festive period it is also imperative to spread the word regarding promotions and various offerings for which social media is the most significant platform. Contests are also initiated on various social platforms to create a buzz and maximise engagement. Offers and promotions are also shared with our patrons through email campaigns,” adds Shubham. “Festive marketing is all about offers/packages, same helps in making emotional connect with communities. The overall revenue earned does help in covering the few heads,” says Mehrotra, adding that the hotel plans atleast a month in advance on various marketing strategies which involves digital media, print media, social media and direct marketing. Fairmont Jaipur includes all platforms to market itself in the domestic and international market. Presently, the hotel is running a contest on Facebook #Dream Come True, which is is all about sharing precious moments or a memorable moment with the hotel on their Facebook page and the winner will get two nights stay which will consist of activities and experiences. Fairmont Jaipur is also organising a special cake promotion. “In restaurants we display food set ups with unique food counters as per occasions along with various activities for kids,” informs Mehrotra.
Earlier, traditional festivals involved traditionally innovative marketing initiatives. But now there has been a shift in trend seen from traditional buying of chocolate/ mithais to more exclusive and personalised gift hampers. FMCG companies and grocery retailers like Godrej Nature’s Basket, wine companies also offering Diwali hampers. “Indians have been experimenting with high end amenities including branded leather products along with expensive wines and champagnes as part for gifting. This season, our team of chefs have crafted exclusive hampers with an eclectic assortment of hand made goodies, wines and special cookies. The guest can also have the option of customising the offering and choosing from a range of exclusive homemade cookies, cakes, Indian sweets and even an assortment of chutneys and dips,” informs Shubham.
Price and place
Courtyard by Marriott, Gurgaon is offering three hampers and a customised Indian sweet box. The hampers priced at Rs 5500 (plus taxes), Rs 3000 (plus taxes) and Rs 1500 (plus taxes), offer an exclusive selection of goodies and liquor from JW Black Label Whisky, Red House wine and sparkling waters to homemade Diwali cookies and chocolates, prunes, marshmallows, cheese crackers and pasta. All three hampers contain a handmade diya to mark the occasion of Diwali. The Indian sweet box priced at Rs 750 (plus taxes) can be customised as per the guest’s preference all made in-house using traditional recipes and organic ingredients.
In a market like Mumbai, when the season demands of leisure business, guests are lured by offers with heavy discounting. Satpal Arote, revenue manager, Grand Hyatt Mumbai highlights, “We have understood the fact that giving complimentary meal and spa packages does not lure customers but giving heavy discounts on luxury rooms does. For the upcoming Diwali and Christmas season we have come up with an innovative offer like Grand Escape – Travel with Us – which gives daily breakfast and transportation to the desired destination for sightseeing, shopping and more with eight hours or 80 kilometre included in the room rate. It also includes 20 per cent discount on food and soft beverage, 30 per cent discount on spa and salon service. We also have additional offerings like cooking sessions, rangoli making and art tours available on request to make the stay an experience to remember.”
Grand Hyatt Mumbai being a multidimensional lifestyle complex in the heart of Mumbai is a much sought after destination by NRI and Expat guests during the festive season. On the non-festive months, there is a MICE and business sector related demand and the same moves towards NRI, expat and domestic guests during the festive season who visit Mumbai to shop, relax or just meet friends and family. Grand Hyatt Mumbai has created special packages targeting these discerning travellers during the festive season with experiential offers that make their experience totally unparalleled and memorable. “At Grand Hyatt Mumbai, we believe in creating moments of more for our guests at every touch point and we are bringing this to life with special packages like staycations, Grand Escape (transportation included), celebration offers and more. The idea is to offer more than just a stay for our guests and make them experience ‘Living Grand’ with us,” mentions Arote, adding that, “All the tourist destinations see an upsurge in demand. Also during the festive season, we see an influx from Gujarat, neighbouring cities and the Middle East.”
Every year at Grand Hyatt Mumbai the festivities start with a traditional cake mixing ceremony in October, staycation packages for Diwali, festive Diwali hampers at Gourmet Store and Christmas and New Year celebrations. “In terms of festive marketing, the spends are in line with the regular marketing spends and we do not incur huge expenses owing to the position in the market. We have our set of patrons and guests over the years,” says Arote.
For this festive season, The Taj Hotels Resorts & Palaces has launched the Taj Experience Gift Card, the new experience gifting option valid at any Taj hotel in India. The Taj Experience Gift Card works like a cash-card or easy-to-access e-card at a dedicated microsite – http://www.tajhotels.com/giftcards. The card is available in a number of denominations starting from Rs 1,000 for gift cards and Rs 500 for e-gift cards, the cards can go up to a maximum value of Rs 50,000. Cardholders can redeem the card’s value against any experience they choose at participating Taj hotels.
Sofitel Mumbai BKC is offering exclusive artisan hampers filled with traditional diyas and sweets. These contain items such as designer chocolates, cakes, select spirits, hand-crafted cookies and a range of exquisite goodies. The starting price for these hampers is Rs 1,500 (plus taxes). There are four types of hampers priced at Rs 1,500, Rs 3,000, Rs 4,800 and Rs 11,000 (plus taxes).
Revenue earnings
During the festive period, Shubham reveals that even though the room revenue takes a dip, there is an upsurge in the F&B revenue on the social and gifting front. “This year we are expecting a two per cent increase in our sales than last year,” he states. When asked about the advantages of festive marketing, he opines, “In this current era, festive marketing is looked as a pure marketing initiative to create more visibility viz a viz to a revenue generation marketing gimmick. The revenue earned is nowhere close to what the hotel does during season time,”adding that, “However, this is a time where hotel gives back to the customer and society by celebrating the festival with in-house guests and ensure they experience the festival even if they are away from home. Hotel spends a major part of the festive time in CSR initiatives to share the love and spread happiness. We recently painted an orphanage to celebrate the Navratri period.” As for Fairmont Jaipur, the hotel is looking at a 10 per cent growth over last year.
The business drops down by 12-15 per cent in both ADR and RevPAR. The ARR and RevPAR are directly related to the occupancies driven by corporate travellers in major cities of India. During Diwali or Dussehra hotels see a drop of 50 per cent in business travellers and hence ARR and RevPAR go down. However, the festive season also coincides with inbound season and the Golden Triangle sees an upsurge of business. “In Jaipur, the ARR could be Rs 5,000 – Rs 12,000 as too many hotels are available at various price brackets, business is very dynamic nowadays and the festive season has evolved in categories, like Diwali, Christmas, New Year. Every festival has a mix of clients like Diwali sees more of inbound, Christmas is both domestic and inbound,” mentions Mehrotra.
Overcoming challenges
“The hotel industry is going through a rough phase with supply increasing and business shrinking day by day. Same pie of business is being shared between more and more hotels. It has become the need of the hour for hotels to come up with innovative marketing strategies aligned with the festive season, holiday season, etc., depending upon the time of the year and try and maximise the top line,” says Sonica Malhotra, director, MBD Group. As per Shubham, “A marketing campaign needs to be customer oriented in this time of the e-commerce era. This is a challenge that keeps us innovating. We have seen a surge in online reservations and hence building loyalty means that we keep upgrading our online presence and build interest with online shoppers.” For Fairmont Jaipur, Mehrotra says that less amount of staff during festive periods is also a challenge. Arote points out, “Hotels need to focus more on experience rather than inclusions while designing festive offers and packages as this is the time to splurge and indulge and the guest is looking for unique experiences and extraordinary memories with their loved ones. Often we get carried away with the occupancy and ADR focus and tend to oversee the experience which is even more critical during the festive season when the target audience is leisure travellers. The winning approach is to determine the base numbers and offer – add-on services and offerings at a special price.”
