US hotels are spending more marketing money and shifting their advertising to person-to-person selling, says a recent study by a hospitality consultant.
The later shift involves trade shows, meals and entertainment rather than advertising, brochures and billboards, says PKF Hospitality Research.
“At the unit level, hotel managers are clearly showing a preference for person-to-person contact as opposed to mass communication,” said Mark Woodworth, executive managing director, PFK-HR.
He added this could be an indication that chain-affiliated hotels are relying more on national advertising campaigns conducted by franchise companies.
Hotels increased their marketing budgets by more than 6% in 2004, according to the 2005 edition of Trends in the Hotel Industry.
Hotels are able to add to their spending because earnings were 7.6% higher for that year.
As a direct result of spending more, US hotels had higher earnings, the report said.
The report said that except for limited-service hotels, marketing expenses typically run between 4.5 and 5.6% of total revenues.
Report by David Wilkening
