To all my friends and colleagues in the hospitality world, it is urgent we have a serious talk about what is coming.
We need to talk not just about what is coming, but what is already here. There is a major issue facing North American, Mexico and Central American properties. Although this is certainly a global topic, depending on local and international travel restrictions. But before we go all doom and gloom, let me point out, this is also a massive and much needed opportunity. Here at NAVIS we have a unique perspective in the fact we are the Direct Booking Platform for hundreds of some of the best resort, city, mountain and beach hotel and vacation rental properties and brands across the hemisphere and beyond.
Demand is booming
As a part of our Direct Booking Platform, we offer a contact center solution we call RezForce. Our data shows our RezForce Call Center team has seen a 50-100% increase in call volume over the past 45-60 days. This spike is similar in size to the spike in volume last June when almost every open property saw abandon rates hit 70%+. This is where the similarity ends.
There is an important difference. While we saw a similar spike to call volume last year, there was a high percentage of unbookable calls, policy questions cancellations etc. Likely you saw the same thing at your properties. This most recent spike in call volume is nearly all actual guest bookings and mostly for a 60-90 day booking window. This demand is evenly distributed around all markets across our footprint.
Speaking with NAVIS Vice President of Contact Center Operations, Matt Juarez, these calls are highly qualified calls. People aren’t calling with questions for cancellation requests. They’re ready to book. “As soon as the inauguration was finalized in late January, we started to see a little bit of a turn. And then, suddenly, by mid-February revenue shot up 81% compared to February of last year.”
The higher revenue wasn’t just due to bigger bookings, call volume was up as well. “It was a combination of both the quantity and the quality of calls coming in,” said Juarez. In fact, call volume for February was up 40-50% over the same period last year.
You’ve likely heard the term “Revenge Travel.” This catchy term for pent-up travel demand is a real thing. (For more on Revenge Travel check out our guide Revenge Travel on The Rise.)
It is interesting to note, given the short booking window of this influx in demand, there is still a lot of available inventory on the shelves for the summer months. As vaccines continue to ramp up at an incredible pace, this summer of travel will likely be like one we have never seen. Are you and your teams ready? How quickly can you gear up?
Are you ready for the surge?
The bottom line is this, reservation teams need to be staffed up now, systems put in place now, otherwise companies are going to be caught unprepared to capture the proper share of this pent-up demand. They will lose money and service levels will be crushed. As mentioned, what we are seeing now isn’t even the summer demand spike which is still to come in record fashion. The time is now to deploy the tools necessary to help you achieve the highest success rate with this building volume, and capturing lead data in this time will prove highly valuable for years to come.
Without a proven Direct Booking Platform in place, you may capture lots of bookings, but you will miss many more, and will lack the capabilities necessary to capitalize on this historical opportunity. Leads captured now, even when you sell out most of this summer, as I am sure you all will, can fill your direct booking funnel for months, even years, to come.
Do the math.
Consider this fact. If I am wrong and you hire and train five new reservation agents at an average hard cost of say $10,000 per person you will have wasted $50,000. If I am right and you abandon a thousand calls in June, you will have lost $400,000 in room revenue alone (using: average booking value = $1000, average conversion 40%).
But Michael you ask, if we are sold out and there is no inventory left on the shelves, how will we convert those into bookings? Wrong. With an effective Direct Booking Platform, these thousand leads can be converted at similar rates into time periods in which you have the inventory to sell using both automated and human driven strategies. This one opportunity only scratches the surface of what effective teams can do with reservations lead data.
The wave is coming, we need to be ready. Here at NAVIS, we were not immune to the trials of the lock downs and business impacts of COVID over the last year. Those of us who were lucky enough to avoid furloughs have lived by this mantra, “Let’s help bring our friends back.” I implore you, bring all of your friends back and some new ones and quickly. If you aren’t ready, the average property stands to lose a million dollars in room revenue in this time, room revenue you can expertly insert into need periods with the right strategy.
Lastly, you are wondering perhaps, “What is a Direct Booking Platform,” and “How do you capture leads on not booked reservation inquiries?” Please reach out to us; we would love to share exactly how to do this. And in the very least – bring all your friends back.