Many challenges in leading the commercial team in hotels

12 October 2021
The commercial manager will face many challenges, such as finding talents, new guest segments, better tools, systems, and maybe even a new vision for the next three to five years.

The recovery from the pandemic will take time for the hospitality industry. However, it will probably be easier for leisure hotels than for business hotels. People are longing for the excitement of travel and will use their saved money as soon as governments ease restrictions. During the pandemic, we learned to conduct business and work in a digital world. The digital way of doing business has more advantages than disadvantages, so it is not only here to stay but will continue to develop rapidly. Therefore, more leisure demand and less business demand seem to be the future scenario for hotels. The changed travel behavior will polarize the hotel industry, where leisure hotels will be back to normal very soon.

In contrast, business hotels will have to fight to attract guests during weekdays for a long time. The lack of business travelers will significantly impact profitability for hotels that pre-pandemic had a large share of this segment. Short-term, the business segment needs to be replaced by other travelers.

Commercial work is more critical than ever

The commercial work in a hotel went from handling a steady flow of guests, yielding rates, saying no to groups, fully booked hotels, and an easy job to manage the endless demand. The 2020 forecast from UNWTO expected another year of solid growth of 3-4 %. However, the pandemic stopped the never-ending growth, so there is now an imbalance between supply and demand. Hotels need to attract guests instead of managing a constant flow for the first time since the financial crisis. Therefore the commercial work is now the most critical part of the hotel business.

Many challenges for the commercial leader

A strong commercial leader needs to drive all commercial activities to recover faster. Here are some of the challenges.

Hard to find talents

It will be hard to find the right talents or find anyone good enough willing to work in commercial roles in the hotel industry. Knowledgeable and skilled commercial people left the industry and will not return any time soon. But, will they ever return when they discover how other industries use modern tools and systems, pay higher salaries, and have better working conditions?

Difficult to find new guest segments

Some hotels will most likely need a repositioning on the market to find new guest segments. One example is city center business hotels where the customer base has shifted from business to next to nothing during weekdays. A repositioning requires market research, new concepts, and possibly also some additional investments.

Tricky to find better tools and systems

Commercial teams need new tools and systems that will be better integrated and help the team members work faster and with higher accuracy. When the commercial roles worked in silos, they used solutions that solved a specific problem well but rarely integrated with other systems and the big picture. With a less skilled workforce, systems need to be simplified and solve a broader problem.

Need of a new vision

Finally, even if the outlook is a bit blurry, the owners/top management need to re-visit the vision for the hotel and clarify the long-term goals to all team members. Just waiting for better times will not make anyone happy since there are pressing things that need to be taken care of right now.