SELLING HOSPITALITY: A Situational Approach
Publication Date: Spring 2004
By: Richard G. McNeill, Jr - Northern Arizona University &
John C. Crotts - College of Charleston
Publisher: Delmar
See Table of Contents Below
Consider for a moment: The association meeting
planner who has just finished a successful convention; the restaurant manager
of a fine Italian bistro who has just opened a new account with a food wholesaler;
and the outbound tour operator who has just put together a line of tour products
for a new destination. At some point,
all three of these customers were no more than a lead or prospect. In each
case, someone in the sales department of the convention hotel, the food wholesaler,
and the destination marketing organization did something right in gaining
these persons’ attention and winning their business.
Someone once commented that
nothing happens in the hospitality business until something is sold. In business-to-business marketing, of which
professional sales is focused, it takes more to win corporate accounts and be
successful than to simply advertise that you are open for business. It takes sales to convert features into
benefits in the minds of the client. Make no mistake, the hospitality and tourism
industry is competitive and clients' have tremendous freedom of choice. To create the level of awareness, interest,
desire and ultimately action on the part of organizational buyers, it takes a
professional salesperson to probe for and understand the client's needs and
provide them solutions to those needs better than the competition.
Yet
few professions are as under-appreciated in our curriculum more than
sales. Virtually all hospitality
programs require a course in marketing, where sales is covered in a lesson plan
or two as a part of the promotional mix. We argue that this limited view
warrants rethinking given: (1) the importance of salespeople to the functioning
of our hospitality industry and (2) that most of our students who are marketing
oriented assume sales positions as opposed to marketing positions after
graduation.
As
we have moved into the 21st Century, companies are redefining their
business models and we predict that hospitality sales in 2020 will have little
in common with sales today. Selling
Hospitality: A Situational Approach provides students a realistic
view of the knowledge and skills they will need to master in order to be successful
as hospitality sales professionals. Drawing
from the insights of leading sales executives, the textbook explains the hospitality
sales profession, how it is changing and outlines the three emerging selling
roles and when they are appropriately used. Transactional selling, consultative selling
and alliance selling are unique selling roles that are appropriately used
depending on ‘situational factors.’
Transactional
selling is
the oldest form of selling and is appropriately used where ‘rates’ and ‘availability’
will be the principal criteria in the purchase decision. Often it exists in competitive conditions where
the buyer considers the goods and services simple ‘commodities.’ Transactional selling is the form of selling
that will be impacted the greatest by e-commerce. To illustrate, consider
the meeting planner with a limited budget who does not need a great deal of
technical support for an event. The
hotel that sells over the internet can achieve competitive advantage by providing
a lower price by eliminating the cost of the salesperson in the transaction. A number of e-hubs, portals and vortals such
as starsite.com, meetingbroker.com, plansoft.com, allmeetings.com, and eventsource.com
provide such mechanisms and will have an impact of the number of transactional
sales people needed particularly among corporate chains of limited service
properties. In this environment the
sad fact is that transactional salespeople will become secondary to technology
and product development among these chains. Customers will always be offered a choice in
how they connect with the company via the internet, a salesperson, or a combination
of both so that the customer will be able to interact or build the type of
relationship with the firm the way they prefer. We argue that the salesperson that most successfully
adapts to this e-commerce environment will be required to become more strategic
in nature in finding ways to deliver process value within the digital value-creating
network.
Consultative Selling
is a selling form that evolved in the mid-1980’s and only today is being put
into full practice. Consultative salespeople sell higher-priced
complex products and services to firms that offer the potential for profitable
repeat business. Consultative salespeople are focused on relationship building
and total account penetration of key corporate accounts by seeking ways to
add value to the client through all stages of the buying process. Consultative
salespeople are the elite ‘lead’ salespeople who are highly compensated and
supported by staff, technology, and continuous training and development.
Alliance
Selling/Management. We predict that buyer-supplier
alliances will emerge in the hospitality industry; a new business model that
is prevalent in the supply-chain management of manufacturing sectors. Strategic alliances or cooperative
relationships as they are often characterized represent a new business
model where buying organizations intentionally form deeper more cooperative
relationships with fewer suppliers in an effort to improve quality and drive
costs out of the manufacturing process. In
such alliances, the consultative salespeople do not sell in the traditional
sense but become relationship initiators and managers. We predict that hotel chains that span the
entire range of properties (i.e., limited service to 5 star) and locations
will form such buyer-supplier alliances with end-user customers -- large corporate
clients who expend considerable resources on corporate travel, meetings, events,
as well as with suppliers upstream and downstream the chain. By working
in partnership to streamline procurement procedures, costs can be driven out
of the exchange process for both firms that in turn can be used to increase
quality at a reduced cost. The supplier
can also reward the buyer by further lowering costs since the supplier has
reduced their need to advertise and market as intensely as before due to the
guarantee of the buyer’s business. For
the hotel chain value is captured through increased volume, better forecasting
of demand, lower marketing costs and better facility utilization.
For alliances of this nature to reach their full potential, each firm
must view the business-to-business relationship as a true business paradigm,
not a procurement technique.
Not all corporate accounts will be candidates for alliances. Relationships of this nature take time and effort to develop and the value that can be created through cooperative efforts must be sufficient for both the buyer and supplier firms to invest the effort. The corporate culture of the buying organization must also be taken into account. Many individuals -- and the organizations they create -- cannot be expected to change from playing poker with suppliers to cooperating with them. For a hotel chain to embark on a cooperative relationship with an organizational buyer who retains an adversarial attitude will inevitably be a source of conflict that will keep the relationship from achieving its full potential for both the buyer and supplier.
Hospitality sales professionals today are venturing into a rapid changing environment where the basics of the personal selling process still apply. According to David Wilson (2000), sales and marketing is “still about segmentation, needs generation, value creation and the delivery of the promise that we make to the customer” and the sales person who takes a broader view in the creation and exchange of value will be successful. Technology will play an enormous role, but according to Anderson (1996) it “will never replace the salesperson’s ability to establish trust with customers, respond to subtle cues, anticipate customer needs, provide personalized service, nurture ongoing relationships, and create profitable new business strategies in partnership with customers” (p.36).
Selling
Hospitality: A Situational Approach
Table of Contents
SECTION
I.
The Big Picture
Chapter 1: Hospitality
Leaders Know How To Influence
Chapter 2: Buyers And
Sellers In The Hospitality Industry
Chapter 3: Creating Mutually
Beneficial Value Exchanges
SECTION
II. Understanding the New World of Buyer-Seller Relationships
Chapter 4: The New World
of Buying: Value Perceptions Affect Buying Decisions
Chapter 5: The New World
of Selling: Response to Buyer Perceptions of Value
Chapter 6: Situational
Selling: Strategies and Tactics Depend on Value Perceptions of Both Buyer
& Seller
SECTON
III.
Managing the Sales Process
...................Phase
One: Pre-Negotiation Strategy
Chapter 7: Negotiation
Preparation and
Chapter 8: Step One- Approaching
the Buyer
Chapter 9: Step Two -
Investigating Needs
Chapter 10: Step Three–
Demonstrating Capability
Chapter 11: Step Four–
Negotiating Concerns
Chapter 12: Step Five–
Gaining Commitment
Chapter 13: After Sale
Implementation, Relationship Management
SECTION
IV.Managing Your Future
Chapter 14: Personal and
Professional Development
Chapter 15: Sales Management:
New Exchanges Processes Require a New Management Approach
Chapter 16: Sales Intermediaries: Partners in the Supply Chain
Chapter 17: Sales and
Technology
Chapter 18: The Future of Hospitality Sales: A Situational World
In
Closing. Every
day we see the evidence of influence and persuasion. These elements characterize
societal exchange. Some simply choose
to pursue a career that is widely understood as a sales profession. Today, the route to a General Manager and
senior management with virtually all-leading hotel companies requires trainees
to spend time in sales. These firms
understand that sales training and experiences not only provides them an understanding
of what it takes to create a customer, they also believe that the skills in
communication, persuasion and interpersonal skills they glean in sales will
serve them well no matter what leadership position they later choose.
FOR MORE INFORMATION:
Send E-mail To: Richard.McNeill@nau.edu or Call: 928/523-1713
Richard G. McNeill Jr. Ed.D., CHME
-Northern Arizona University
Copyright
© 2001 Hospitality Sales Institute
ALL
RIGHTS RESERVED