Companies Which Can Adapt In Better Position To Succeed
Monday August 23rd, 2010 - 6:34AM
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As the summer comes to a close and we look ahead to the more prosperous times that have been predicted by many, I think of several adages that appropriately describe the economic downturn that plagued our industry over the last few years. These expressions include “when the rubber hits the road;” “the moment of truth;” “survival of the fittest;” “that’s what separates the men from the boys;” and, of course, “the women from the girls.”
On the surface they seem like clichés, but each is rooted in serious reality, where making the right decisions is the difference between success and failure. Many of these decisions were not only difficult, but gut wrenching, particularly with regard to moves like employee salary and benefit reductions, layoffs and furloughs.
However, for the sake of survival, these decisions had to be made. I think it’s safe to say those who adapted and developed strategies for the “new normal” economy are in a much better position to succeed than the companies that kept their heads buried in the sand. These were scenarios faced not only by hotel company executives, but by suppliers, lenders, brokers and, yes, even magazine publishers.
After all, traditionally during tough times it’s the advertising and marketing budgets that are hit the hardest. Marketing executives responsible for media placement, trade shows, creating sales collateral, etc., are expected to do more with less. One significant difference between this downturn compared to those in the past is that the cuts have been deeper and in place longer.
Trade shows and publications that were automatically budgeted for year after year are now scrutinized. The days of pure patronage and relationship deals have been deemed a thing of the past. I am NOT saying relationships are any less important in today’s environment; what I’m saying is relationships are one piece of the puzzle. The reality is a relationship without a better mousetrap just won’t cut it anymore.
Shift in strategy
For the most part media companies developing new products and solutions have survived the recession in better condition than their competitors. In fact, the downturn has served as a catalyst for entrepreneurial companies looking to take market share from their less flexible competitors. To paraphrase Paul Romer, the noted Stanford University Economist, “a recession is a terrible thing to waste.”
I am proud to say that market share at HOTEL BUSINESS® has increased significantly over the last two-and-a-half years. According to figures tracked by Patterson Advertising Reports Inc., our market share increased from 29.83% in 2008 to 36.86% in 2009 and it stood at 37.39% through July 2010.
During this same period, HOTEL BUSINESS® has gone from number two in overall market share in 2008 to a decisive number one. (The number two ranked publication currently has a 23.10% share compared to our current 37.39%.) Feel free to e-mail me at firstname.lastname@example.org if you’re interested in receiving complete versions of the 2008, 2009 and 2010 YTD Market Share Reports.
I have heard many say they’ve had to work harder during the past year or two than they’ve had to in a long time. This definitely applies to our entire staff. Our success hasn’t come easy and we fully expect that we will have to maintain the same ferocious pace in order to stay successful. We also understand that the honor of being the top publication serving the field is a direct result of the invaluable support of so many members of this great industry.
The most recent NYU Conference, earlier this month proved, once and for all, that the lodging industry has finally turned the corner and happy days are, indeed, here again. While the economists and pundits all provided plenty of anecdotal evidence to bear that out in terms of supply and demand ratios, RevPAR projections, asset values and all the other metrics, that’s not what has me convinced.