Strategic discounting can drive hotel F&B

Strategic discounting can drive hotel F&B
The panel discussed discounting strategies in hotels.
Published: 27 September 2017 - 3:07 a.m.
By: Claudia De Brito

The eighth edition of the Hotelier Middle East: Great GM Debate took place the Le Meridien Dubai Hotel & Conference Centre.

This year conference included a series of panel discussions and presentations, where the region’s leading hoteliers discussed opportunities, challenges and issues including whether or not F&B outlets in hotels should offer discounts.

The panel, titled — Food & Beverage Focus - Is it Time to Ditch the Discounts? — was moderated by Stefan Breg - Director of F&B Middle East & Africa, Marriott International and covered points such as the high cost of dining in the region for consumers, loss of revenue from covers that are taken away from full price customers and how to ensure a quality dining experience at a discounted price.

On the panel Peter Skudutis - general manager, Zero Gravity Dubai; Sascha Triemer - Vice President, Food & Beverage, Atlantis, The Palm; Christian Gradnitzer - ‎Senior Director, F&B Operations EMEA, Hilton and Heiko Röder - Executive Assistant Manager, Food & Beverage, One&Only Royal Mirage, Dubai.

Speaking about how discounts can be used to drive business Triemer said: “Restaurants can save on marketing. If a restaurant is empty, it’s an easy sell.” Skudutis echoed the sentiment, saying: “restaurants comp tables because they want numbers in.”

The seasonal nature of doing business in the region means that discounts can act as a lifeline during low periods. Gradnitzer added: “We’ve got our downtime. We operate for literally nine months out of the year. When it comes to discounts, the main purpose should be to drive the business further and get cash flow during low periods.” Still, he was clear to point out that just reducing prices isn’t enough. “Our concept has to be clearly communicated because we want customers to come back, and gain loyal followers.”

Triemer agreed with Gradnitzer saying that when it comes to using third party providers such as Entertainer or Groupon: “Loyalty is the biggest issue. We need to try and create value for money without using third party entities”.

Still, the trend seems to be growing. When asked whether there would be more or less discounted offerings from third parties in five years, Röder said: Leading up to 2020 and the opening of new restaurants, I do believe it will get worse.”

It is possible for discounting to increase revenue and loyalty without causing negative perceptions but hotels need to come up with creative on-brand solutions.

 

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