Cultivating success in a niche hotel market is often challenging and requires more than your traditional hotel management strategies.
When the destination is the primary driver of new bookings, hotel operators can find themselves at the mercy of the unexpected, from how well the economy performs to the availability of local businesses — and even the weather. Leaders at these hotels benefit from a greater understanding of the trends that affect their properties and how to provide the experience their guests are traveling for despite limitations.
And make no mistake, boutique hotels today are facing limitations. Due to various economic and socioeconomic factors, hotel room supply is drying up often where it is most needed. Independent hotels across the U.S. have struggled to remain profitable over the past few years while home-sharing and VRBO businesses absorb potential hotel bookings at a rapid pace.
Despite this, demand has been surging in destination markets. As a result, guests are more invested in experiencing their destination than ever before, including the hotel they choose for their stay. Authenticity is for sale, but no one can grow it. This is boutique hospitality’s bread and butter, so it’s essential to ensure operators have the tools to fully satisfy each guest while delivering on their authentic service promise.
Staffing, Personalization and Distribution
The entire hotel industry is finding ways to mitigate staffing challenges, but these difficulties are amplified in boutique hotels. Seasonal hotels are often located in markets with a high cost of living. Hotel owners in these markets have few options for long-term labor, so they must instead adopt long-term planning to appropriately manage their properties. For example, a Nantucket boutique may begin hiring new staff members in September to ensure enough hands are on deck for the busy season in late March. This strategy requires a balance of local and transient labor.
Niche or seasonal markets must also identify their target audience and strategize ways to entice them into repeat bookings. One standard error made by operators of these hotels is their desire to focus on a customer base that is too narrow. Boutique hotels are not advised to be all things to all travelers, but many could stand to cast a wider net.
For example, peak summer travelers are markedly different from guests who hit the road during the shoulder season, and it could be advisable to court certain groups when your hotel is looking to fill rooms rather than when it is at full occupancy. After all, there are good and bad times for surprise group bookings from a bike tour or little league team, and they aren’t when your property is pushing rates to benefit from spring break travel.
Similarly, independents and boutiques often benefit from a more open distribution strategy. While many boutique operators fear the damage online travel agencies may cause to their business over fees and service challenges, they may need to accept more of these bookings and convert them into direct bookings in the future. This is a long-term yet time-honored strategy hotels can gain from today.
While fond of tackling challenges head-on, independent hotels are not being asked to acclimate to these changes without assistance. Independent hotel leaders must adopt a proactive stance toward new technology, starting with establishing clear goals and identifying strong, reliable partnerships to help manage their tools. Using the right technology, operators can be reinvigorated on the back of new efficiencies without adding unnecessary overhead.
Shout It Out
The more niche your market is, the louder your hotel needs to be to earn attention from travelers. Boutique hotels thrive whenever their identity is presented to travelers — they simply stand out from other hotels. However, this distinction is only valid when it is visible. Many hotel operators are still underutilizing social media to promote their property, which is an error in today’s operational landscape. Authenticity benefits these properties, not external pressure, and unique hotels must tell their story. Guests will reward them for it with new bookings.
Niche hotels also have a duty and responsibility to provide excellent service to all travelers, but mainly to their repeat guests. These properties rely on a cyclical business model, which must be built and maintained to remain successful. Success in this arena requires effective marking, a strong welcome experience, thorough attention to detail and follow-through as guests' stay concludes and into their post-stay experience. Guest reviews are vital to small hotels, and travelers rely on them to make purchasing decisions. These reviews must be managed beyond the confines of your hotel’s website and should include online travel agencies.
Operators who create aggressively budgeted goals for each boutique or niche property improve their understanding of what and who they need to remain successful, from guests to staff members. Boutique hotels are defined by their values and vision. It’s why travelers choose them and why hoteliers desire to operate them. Operators who take pains to understand these elements in the context of their local marketplace will be positioned to thrive in any season.
Robin Kirk is president of Maverick Hotels & Restaurants.
The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or CoStar Group and its affiliated companies. Bloggers published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to contact an editor with any questions or concern.