It seems that every Hotel company came to recognize the importance of value to their customers in 2010 and worked to position themselves against their competitors as providing better, or more, value than their competitors.
It certainly served to ramp up competition, and I suspect, get many Hoteliers to examine what their value proposition was, and once they figured that out, how to creatively and effectively communicate that point to their prospective customers.
The big winner in the chase for customer dominance has to be the customer themselves.
Every time they turn around, another company is trying to court them and to entice them with yet another perk for choosing to stay with them over their competitor.
But I believe something has gotten lost in this fast-paced race between Hoteliers.
As they have been busy trying to one up each other, many of them have somehow managed to (incorrectly) translate value into “cheaper is better” and they have devalued their product and experience, along with their competitors, along the way.
Value can be an elusive target, and it means something different to everyone.
I have found myself paying $300.00 or more for a dinner for two and left feeling very happy, very satisfied, and, feeling like I got great value for my dollar, based on my expectations, and, my overall positive experience.
How much it cost never crossed my mind, because my expectations were exceeded and I had an exceptional experience.
Conversely, I have gone out for lunch for two and spent $50.00 and left feeling entirely ripped off. Food was mediocre, service was largely the same, and my overall experience was one of aggravation and frustration.
How much it didn’t cost was not the issue.
What was the issue was the impact of the overall negative experience.
Therein lies my point; you can’t put a price on value.
And if you can’t put a price on value, then it’s entirely possible that all you are doing is unnecessarily discounting on your product and experience, and, you’re leaving money on the table.
The one, and only, company that I have seen that seems to truly understand this is Four Seasons Hotels.
They have remained steadfast in their support of, and commitment to, the value of their brand and what it means to stay at a Four Seasons Hotel and to have a Four Seasons experience, and it’s not for sale.
You won’t find Four Seasons Hotels on Expedia, Hotwire, Orbitz or any of the other on-line discount channels – they flatly refuse to get into the discount wars with other Hotels of their caliber in their various markets.
I won’t pretend to know the level of business that Four Seasons has been able to maintain during these tough economic times, but I will speculate that if this was a losing proposition, they wouldn’t still be holding out.
Also, when the economy improves, Four Seasons won’t be faced with the same challenge that other companies will face – how to now significantly increase their rate from the depths to which they have sunk, and, how to convince their guests that their increased rates are suddenly justified again.
Hotel companies that are out there teaching consumers, by their actions, that there is always a better deal to be had, are going to face a long and hard return to profitability as and when the economy returns into positive territory.
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