Boutique Hotels: Rethinking the Fundamentals in a New Business Environment

The cost effectiveness of technology, coupled with its global reach, has contributed to the new hotel environment. With the encouraging business outlook, hotels are now, more than ever, in a position to assess the new business environment and to establish a strategic business plan which incorporates these changes and are designed to grow and adapt to changing market conditions.

By Brenda Fields
Technology has brought numerous advantages to conducting business, including servicing existing customers and in reaching new markets. But as a service industry, it is important to ensure that technology is used to enhance guest satisfaction, especially in the case of free-standing boutique hotels. One key factor that differentiates boutique hotels from large or chain affiliated hotels is its personalized service.

Therefore, in order to benefit from the many applications of technology (i.e. reducing expenses, generating demand, and increasing guest satisfaction), and to simultaneously maintain the personalized services characteristic of boutique hotels, it is important for owners and managers to re-think and evaluate the following key areas:

Web Marketing:
Regardless of the size of the marketing budget, the Web has evolved into the most important component of the marketing plan. Properly developed, executed, and maintained, the Web will, at a minimum cost, effectively reach local, domestic, and international markets. It is especially important to understand the difference between the two key components, i.e. the artistry of the design and the technology, and how to integrate the two. Many times, Web sites are created by technology professionals who do not understand the nuances of marketing; and vice versa, marketing professionals who design a Web site only from a visual perspective, without consideration of how key technical components, built in, can drive demand.
An effective Web site design and effective an on-line distribution strategy require expertise. The lay person is bombarded with many ideas and is left wondering which approach to take. Therefore, if relying on expert advice, it is important to have a customized plan to accomplish specific short term goals, as well as ensure that the Web site is well positioned for future technological advances and for advancements with the search engines, in order to minimize financial risks.
With the growth of the Web, there are many parties creating ways to profit. Search engines, third party internet booking companies, and advertisers, to name a few, all have competitors, so they are ever-evolving in order to dominate the market and to increase their own businesses. Therefore, before going forward with a plan and to spend wisely, it is necessary to fully understand all of the options and choose the best ones for your short term as well as long term goals.

Just a few years ago, new technology helped owners and operators reduce expenses and create demand by centralizing reservations and providing a toll free number for customers. Now, with the new technological advancements coupled with new customer buying habits, the industry has evolved to using "on-line" and "off-line" reservations as part of its daily vocabulary. Booking on-line reduces costs by reducing labor, but the key is to provide the information and service that will allow and encourage the customer to book and generate revenues! If the information is not there to help the customer make a decision or if it is not easy to book a reservation, business will be lost.
A small, boutique hotel can benefit from the advanced technology allowing customers to book directly on-line, using the Web site. Planning and maintenance is the key, which can only be done by people exercising good judgment, not technology. Therefore, to maximize the on-line booking capabilities, designate a staff member to ensure that rates, promotions, and room inventory are consistently up to date, and that the customer has the ease of booking, revising, and canceling. A simple process of trying many hotel Web sites will help identify the elements which make a great reservations system from a customer's perspective.

Guest Interaction:
In many ways, technology has created an impersonal way of doing business. But, we all benefit from the convenience it brings to our lives and enjoy the option of doing business 24/7 by using the Internet, e-mail, voice mail, text messaging, etc. We can order products and services from all over the world and have immediate access to information by just pushing a button! But keeping in mind that personal service generally distinguishes the small independent hotel from the large chains, it is important to evaluate the areas of guest interaction and measure the impact of technology. The personal touch of interacting with guests and potential guests in a warm, efficient, and professional manner, either over the phone or in person, is a powerful tool that fosters goodwill and guest loyalty, which translates to market share and revenues.

By fully exploiting the product distinctions of small boutique hotel and using technology wisely, owners and managers are well positioned to compete against the large chains to impact market share, minimize expenses, and generate profitability.

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