Why Hotel Performance Depends on Commercial Leadership Across Sales, Marketing, and Revenue

Hello, and welcome to another episode of the socially awkward podcast. I'm your host, Calvin Talocchi, and I am here with Jason D'Agostino, commercial leader and fellow New Yorker. Welcome to the show, Jason. Thank you, Calvin. Good to be here. Thank you. So tell us a little bit about yourself and your background here hospitality industry. Great. Thank you. So I am a certified revenue management executive, most recently with Visions Hotels, where I served for just about, just over eleven years, supporting our sales, marketing and revenue team. Prior to that my background was always in operations, but I've had a lot of great mentors and leaders that I worked with through the course of my career. And each time I served a new operations role, learned a little bit more about sales, marketing, revenue and had a great opportunity to establish a revenue management team back in twenty sixteen, where prior to all of our revenue management work was outsourced. We decided to establish our own in house team of revenue managers. And we did that with about twenty five hotels that we started with. And then we scaled up to about seventy. And it was a great time and, could not have done it myself. Didn't do it myself. Like I said, surrounded by some great, leaders and some great team members that helped, make that all happen. Yeah, that's interesting. So what was the major change from going from outsourced revenue to bringing it all in house? I think it's multifold, right? There is an expense to outsourcing when you're partnered with the brand. And yes, there's a cost to do it in house as well. But when you're doing it in house, when your in house team is all working in tandem, right? I think it helps break the silos that we're going to talk about. And we hear that word silo a lot. So if your ownership is controlling or management is all working together with sales, marketing, revenue and operations, and they're all part of the same entity, it makes it easier to push through that collaboration, which is necessary in order to ensure financial success. Yeah, absolutely. You know, having everything under one umbrella, so to speak, it should should make things more seamless, you know, and everything has to kind of work, work together, work hand in glove. And that's a bulk of the conversation we're going have today about commercial, being a commercial leader. It could be my dates could be a little off, but I feel like the title of commercial strategy or commercial leader is fairly new. It's sort of, you know, it's still to me feels a little bit of a buzzword. I feel like it maybe started right around the pandemic or right after the pandemic. It became a little bit more mainstream for people to be called commercial leaders. So, you know, tell us a little bit about what that means to you and what was your experiences? What makes a commercial leader as opposed to just a revenue manager? So the commercial leader takes all facets of all the legs and puts it together to make it a balanced stool, if you would, right? So, you know, we're looking at sales, we're working with our sales team, we're working with our marketing team, revenue managers and operations. Each one of them, you know, under, like you said before, on the one umbrella equals commercial strategy or commercial strategist, somebody who's able to tell the story of the data points and then collaborate with each one of those individuals or departments and start drawing up together some action plans that will drive profitable revenue. You know, revenue managers, or at least the modern revenue manager, has to be so attuned to everything, whether it's digital marketing, how your website is producing, social media, things like that. And I was spoiled in my revenue career. At the time, I didn't feel like being spoiled. You know, we were kind of made to do everything as the director of revenue. You know, we had to be involved on the website calls, marketing calls with social media, PR, all these different things. But there's a level of education that came with that. And one one example I can give that it really I think really highlights why it's so important for revenue managers to be involved in everything is I get on one of our digital marketing calls and we had this conversation. They had this cool thing on the website, sort of a heat map, that like where people were clicking the most. And people were mostly clicking on our banner ad like right under where the dates were on the website. Know, pick your dates. We had a banner ad there and we would typically put a discount of some sort there And people were mostly clicking on that. And I just said, you know what? If that's where most people are going, I couldn't. I wanted to test whether or not it was the discount or just the visibility because it was sort of like right eye level on the website. I switched it to our bar rate and we saw no no decline in clicks. People would just go in that now. So we started to get more more bar ADR started to go up. And it was to me, it was so cool. You know what I mean? And things like that is why it's important for revenue managers to be involved in all facets of the business, because without that piece of information, I would have never made that decision. And, you know, we wouldn't have had that that type of success. Absolutely. I and I I love what you said before about being on a being on different calls and having to be engaged in different things. You know, I think sometimes when we're younger in our careers, we kind of take for granted, oh, it's another call. It's another, more calendar events. Fast forward, you think about what we've learned over the course of years by being involved, whether it's a BEO meeting, a resume meeting, you know, a sales meeting, a brand meeting with our brand partners. We take all of these things and we, we, we put it together and we're, we're creating our own playbooks and it's very beneficial and very useful. I think that's how the evolution of revenue management has become what it it is today. Right? It started with a reservation department and it's it it has blossomed into commercial strategy. Yeah, yeah. And you know what you say is so important because it's important to understand why you're in these meetings and what these meetings are for so they they don't just become another thing to do or another another meeting that could have been an email, as they say, right? Absolutely. And I've always I started out in the reservations world and I've always been big for myself, understanding how my role plays into the larger picture. And that's how I've always led my teams as well. It's, you know, if we don't do this or when we do this, this is what happens. This is how it affects front desk housekeeping sales. And just understanding how your role plays a part in overall larger picture. So when we go into these different meetings, hopefully our commercial leaders these days are going in with an understanding of, okay, this is how this is going to impact our revenue and how my strategies impact them, because everything plays off each other. And I think that's where, again, the collaboration and not working in a silo really shows its significance. Cause you mentioned before preparation for that meeting. As we prepare for that meeting, very often that revenue manager is tapped to distribute, information, right? Segmentation reports, pace reports, year over year statistics. So we're building relationships with our team members, with our coworkers. And I truly believe that it all begins with trust. In order to build that working collaboration amongst the stakeholders, there has to be a level of trust that's established and earned by the revenue manager with all of the stakeholders and all the team members. Absolutely. And I found one way that is effective to build that trust as a revenue manager, right? Because the stereotype is we're just sitting in our ivory towers, you know, pointing out rates and saying yes, no to, you know, sales on what groups they can take and what rates people can sell and whether or we oversell or close the house and all these different things. But I started out, as I mentioned, in reservation, but also obviously front desk. I think most of us start at the front desk, and I've been in those shoes of walking people and oversold situations. You know, so I know what that looks like. I know what that anxiety feels like when you see an open sold house. So part of just as an example, we on the days we would have to oversell or we had big groups in these different things, We send a daily email to our operations team front desk team. Here's where we are. Here's where we expect to finish. If we don't wash out, if we are oversold, here's where we, you know. Our our our concept, here's what our concept is charging, call these hotels first, giving them a heads up and just letting them know. I think just the just the knowledge that, hey, we're not just selling, overselling these rooms and saying, screw it, you guys go deal with it. If it does, if we don't get enough no shows saying, you know, just letting them know that we know what that feels like. We understand that this is not ideal, but here's the game plan. And just given that that that affirmation and a kind of a bit of armor on the shoulder, like, you know, we we're all one team at the end of the day. We're all shooting for the same goal to sell at the hotel. And if and when the strategy just doesn't work out, we're here to support as best we can. Support and learn from it, right? Importance that mistakes will happen, and that's okay. What do we learn from it? Did we memorialize it? If we overbooked, did we utilize our revenue management system to indeed say what that demand actually came in at and adjust? Maybe we need to adjust our systems, our cost per occupied room, the settings and the reevaluate what tools we're looking at for analytics that led us to one decision. And if I could just go back a moment to one of the things you had mentioned, right? Talking to sales, speaking with our sales team and saying yes or no, I like to tell our revenue managers, I don't like to, and challenge them to avoid saying no to sales, but say how. When we lead in with that type of of openness, a trust starts to develop a relationship with that sales manager begins to evolve. It really that that's one thing that happens. The second thing that happens is we start having conversations that maybe would not have happened before. Is the group, able to come in a day before a day later? Are there concessions that maybe could be renegotiated that are going to be more favorable for the hotel, not just to achieve top line revenue, but the flow through to the bottom line. Right? So I like to try different approaches with our sales team in order to have everybody win. Absolutely. Yeah. Like I said, it's at the end of the day, a win for sales is a win for us as well. Right? You know, it's almost the hotel's profitable. Yeah. And, you know, I think you hit it on the head. It's it's it's all about I never said no without explaining why. Right? Exactly. Like, this is what we need. And then, like you said, naturally, conversations come towards, well, hey, listen, if that's the rate they really need, we could do them on these dates. Could they change their dates or can we change something about about that pattern or concessions, like you said? Absolutely. You know, and I think that's that will be a natural result of having those type of conversations. But yeah, I want to start to get into the marketing piece of this conversation, the real meat and potatoes of the discussion today. So as we were prepping and kind of talking backstage, you talked a lot about well, you made a comment that all roads lead back to marketing. Give me a little bit more about what that I remember. I stopped you and said, hey, let's save this for the show because that sounds like it's really interesting. So, yeah, what do you mean by that as it pertains to, you know, commercial leadership these days? So revenue managers can We could adjust rates. We could adjust strategies, hurdle revenues, and different things behind the scenes to try to stimulate demand. But that doesn't happen unless the demand, the people know about the product, right? And in order for them to know what that product is, and if that product is really what they're looking for, it all goes back to marketing. I'm a firm believer in that marketing is agile. It needs to, you know, there's certain common denominators of it, but you know, being seasonal and being in different markets, it's important that our, our marketing follows some type of calendar that works well for that hotel given its location and the, you know, if there's any historical data to go off of or comp set information. So again, it, it, it all roads definitely lead back to a successful marketing plan that's going to help drive what's or help tell us what segments we're going to be working off of at a hotel. Yeah, yeah, And, you know, it's kind of like I mentioned with that website example I gave earlier. If you're not as the modern revenue manager just needs to understand all of these different aspects. You know, finding a hotel is relying on so many different things from your digital strategy, your social media strategy, email marketing, all of these different funnels and distribution channels that we're using to draw traffic to the hotel. It's not just rate, you know? I mean Exactly. They they have to find your rate first. You know what I mean? Absolutely. And in in so in twenty twenty five, I, my team and I, we opened, I think it was about nine different hotels, different brands, different regions, predominantly here in New York. And the first thing that we did was marketing, right? We have to have that marketing plan established so that we could have a successful ramp up so that we could hit, so that the hotel can stabilize. And again, changing rates, that's easy. Creating good content that makes sense for the market, that's not just spending dollars just to spend, that's the part that takes a little bit more creativity, some more research, and definitely takes some time to to build up, but very critical for a successful ramp up and stabilization of a hotel. Yeah. Absolutely. And, yeah, I'm I'm I'm glad you you went into that because you want to talk specifically about ramp ups, new builds. How is that different to a normal, quote unquote, not that there's a normal marketing strategy for anyone, as this is not a normal industry that we work in. But how a ramp up marketing strategy vary from hotel that's already stabilized? So let me first preface it by saying build it and they will come doesn't always work, not in every market. And if you're in that market, that's great. But for those of us who are not, ramp up's critical. Ramp up is that time where we are building an identity of the hotel. Are first we need to establish what it, what are the goals, right? We need to make sure that a sales and marketing plan is established. Do we have the hotel performer? Do we know what the expectations are? Not just of the brand, but of ownership, right? I mean, at some point we need to start showing return on investment. What does that look like? What does the comp set show? What are the, what's the potential in the market? We need to determine, you know, who are we gonna try to feed off of? What are our feeder cities? Where are we gonna shift share from? What's what new opportunities are there? And one of the things that I I tell people all the time is boots on the ground is, is critical. And, you know, yes, we do live in a world where everything's on the computer, but relationships matter. Re relate relationships matter. And I mentioned this just recently on, on a, live LinkedIn, chat, w with another, with another host that it is so important that we build those relationships. When you're, you're building a hotel and you're in that presale, even, even before the hotel is actually live, building those relationships will be very helpful because, there's a lot of supply today and we're, we're all combating for that, that market share. So it's very good to have those relationships and show well your hotel, your property. Yeah, absolutely. And I think that leads me into another topic I wanted to get into as far as the storytelling, right? Because as you just mentioned, there's so much supply in any major city, even some of the, you know, our outer markets. There's just so many hotels everywhere. There's no shortage of options for our customers to, you know, stay at and find. So my opinion is that, you know, your hotel has to have some kind of story. You know, tell us a little bit about in your experience how and why that's important in your marketing strategy. Absolutely. So first of all, the storytelling is critical because every hotel, every asset has its own story to tell. And those stories are based on what's, where's the location of the hotel. Tell us about the team that makes up that hotel. Tell us about the last renovation cycle of that property. Is it a brand? Is it an independent? Give us the history. What's the neighborhood? Right? You know, IHG actually did a great job with, hotel Indigo. And it was all about telling the story of the neighborhood and bringing that experience of that neighborhood forward to that guest. So it really cool hotels in that particular brand within IHG, but having that story to tell, because you may not have a brand affiliation, you may be an independent hotel, right? So making it a little bit more challenging, but if you have that information and you do that right story and you have that marketing team on your side and a great revenue manager, you could all put that together and really, really do something special. Yeah, yeah, absolutely. You know, it just really comes down to, and one of the points you made I completely agree with, You get the question a lot, especially what I do now running a marketing agency is branded hotels, select service. They are like, oh, well, you know, could we be successful with social media marketing because we don't have like a fancy boutique or anything? And I'm always respond the same thing. Every hotel has people. Every hotel has stories, you know, tell talk about your people, talk about your superstars, your employees of the month, your managers. These people have been there for a while. They understand your hotel. They understand your guests. Every hotel has people like that that you can showcase. And that's how you make that connection with someone who's looking finding you for the first time through a screen is what's what's that going to feel like when they when they see that piece of content, whether it's an email or a reel that you've posted on Instagram or Facebook? What is that guest going to feel? You know, what do you want to convey to them? And you have every hotel has people that you can showcase, you know, whether it's through guest stories, reviews, all of these different things. So we all have something to talk about. And that's something I want to make sure that people out there understand. You don't have to be a fancy boutique hotel to be successful with marketing and storytelling. We all have stories to tell because we all have people. Absolutely. Absolutely. One thing that we get a lot and I'm sure you get plenty as a commercial leader is ROI, right? That's always the biggest conversation. If I put X amount of dollars towards this marketing campaign, what do I expect to get back in return? So tell us a bit why why is defining a goal important for marketing campaigns? So we want to make sure that we're allocating our budgets accordingly. And I love what you said about return on on investment because we talk about telling a story. At the end of the month, I wanna tell a story that I I had a budget of a thousand dollars, five thousand dollars and I was able to generate twenty thousand, thirty, whatever that dollar amount is. So we want to tell a story too about how successful our marketing campaigns are. So it's important to be able to articulate that, but when we're meeting with owners, it's important to do that and be fully transparent by having the net return on ad spend, being able to explain that this is what you're, you act after the cost of acquisition, any commissions or any other fees attributed to these marketing expenses. Owners wanna know what that net dollar amount truly is and not just the higher, ratio of return on ad spend. Right? Eighteen to one, twenty one, twenty two to one. They they wanna know what that net dollar amount or what that net number is. So it's it's important for commercial leaders to be able to have the the highlights, but also be able to share in the details. And it's also okay. And I'll go back to ramp up hotels. A ramp up hotel may not show a return on investment immediately. So I've had this before. Okay. Jason, we spent a thousand dollars, but there's, you're, you're not showing a return. That dollar amount may not return until three months later, six months later as part of that ramp up. And I've also seen it where maybe it was too much money that was being spent or maybe it wasn't enough or maybe because we're ramping up, Perhaps this just needs to be part of the other strategy, which is building awareness. That's a hard strategy because a lot of times we're burning dollars as opposed to being able to show a click through ratio. So it's so important that when you are running a media campaign of any sorts, that you are looking at these campaigns and you're looking at what that's click through dollar amounts are. You don't have to adjust it daily, but be prepared to look at it and be prepared to be actively engaged in it. Because those can, again, depending upon the market, those really start racking up some expenses very, very quickly if your team is not constantly engaged in it. Yeah. Yeah, absolutely. And, you know, kind of along the lines of what you were just saying is making sure understand what the goal for that marketing campaign is, right? So in a ramp up, you're trying to build awareness. You're not going to get It's not, hey, we spend one thousand dollars on paid ads and we're going to book one thousand room nights off of that. You might be able to do that when you're stabilized and people know who you are and where you are and what your brand is and what the service they expect to get. But it's not gonna happen right away. And being very clear at the outset of of a marketing campaign understanding this is the goal for this particular campaign. You know? And I can give an example where that we actually didn't clearly set that with one of our clients. So we had an influencer stay with us at one of our hotels last year, and my goal was to generate awareness. Right? So we had looked through the demographics, and this particular hotel skewed close to seventy percent of the audience is female. Most of them are millennial females, thirty five to forty four. So we partnered with someone who was slightly younger than that, but the content she did was very much, you know, think like Gossip Girl, you know, like hanging out in the city. She's partnering with her friends and, you know, just doing what a fashionable young woman in New York City would do. And she came. She did this really, really energetic, real in the in the room, and we gained. Three hundred followers roughly within a week of her posting this. And to put that in perspective, the hotel gained like two fifty the whole year before. You know, so to me, it was boom. This was gangbusters. This was such a great collaboration. And the feedback I got from the property was, well, what she shared, the photos that she shared weren't good enough. And I'm like, Who cares? Who cares? We just got all this traffic, three thousand, you know, each and three hundred clicks on the website that month compared to normally some of them like eighty. But, you know, we weren't aligned as to what the goal was. My goal was, hey, let's get some awareness through this influencer. They wanted to get better photography. So, you know, this kind of illustrates you got to make sure that your that goal is set and everybody's aligned to what the goal is so. You can only measure success if that goal is clearly defined on both sides. And, you know, we speak of independent hotels, boutique hotels. That's why it is paramount that at the beginning, ownership groups do their due diligence and say, okay, we're not going to deal with brand fees. We're not going to have those expenses. However, we will have to do A, B and C in order to combat or survive in a market where we are competing with brands. So, there always needs to be sales and marketing expenses, and when done right, you could really do something very, very special and be very, very profitable when done right. Well, cool. We're getting to the end of it here. So this this one I didn't prep you on because I like to give guests that awkward moment. Okay. Hence the name of the of the of the podcast. What is your most awkward travel or marketing moment? Awkward travel or marketing moments. Yeah. Like, did you ever see a marketing email that went out and you were like, this isn't going to work or or it could be a travel story. You checked in and there was no bed in the room. I checked in or was attempting to check-in and I was actually going to be walked. It was my family and I, we were checking into a hotel in Panama. I will leave the name of the brand, nameless. But it was a, a major brand. And if anybody who knows who I am probably knows what brand it was. We were going to get walked and it was one o'clock in the morning and that was not a fun experience. Luckily, after having some conversation and coming around the front desk, showing the person how we're off. Maybe I just announced which pillar was, you know, explaining how that PMS system works. We were able to figure something out. So you basically check yourself in. Yeah. I love it. I love it. Like, you know what? Hold on a second. Let me move around a couple reservations for EAC. Look. All set. Exactly. That's funny. That's great. Well, that was I think that was more awkward for the front desk agent than than for you. It's all good. It happens to everybody. Right? I mean, we all Yeah. We learn from everything. I hope that that person learned something. I know I learned something, make sure that you remember to say late arrival, which I should have already known, but, yeah, it's all good. Yeah. Hey. You got through it. Absolutely. We always help. And hopefully had a a great vacation after that. Absolutely. Fantastic. Well, Jason, it was great to chat with you. Any final thoughts for the audience before we wrap this one up? I think twenty twenty six is going to be an exciting, year for a lot of us. You know, in the industry, I know that there's a lot of talk about different forecasts and we've seen a lot of forecast variations in twenty twenty five. If it's, you know, again, in order to win the year collaboration with the sales, marketing, revenue and operations team. And I wish everybody the best of luck. Absolutely, man. Why don't you tell the audience where we can find you? Best place to find me is on LinkedIn, Jason D'Agostino. Fantastic. Jason, it's been a pleasure. Wishing you much success here in twenty twenty six. Thank you. And of course, to you guys in the audience, make sure you go find Jason on LinkedIn. Follow us at RevPar Media. Follow myself, Calvin Tziloki on LinkedIn, and we will see you on the next one.