Service Marketing vs. Product Marketing in Hotels

Marketing refers to producing, packaging, pricing, promoting and distributing your company’s product. Product marketing focuses on physical products, such as cars and food. Service marketing involves producing and promoting intangible products. Small-business owners in the hotel industry must find compelling ways to promote their intangible amenities to potential customers.

While hotels can use some typical product marketing strategies, they face different marketing challenges than businesses that sell physical products. If a hotel room remains unsold at the end of the day, the hotel cannot recoup any part of its losses. A car dealer, in contrast, can sell unsold stock on another day, even if it must lower prices to do so. Consequently, hotels must market their services with an eye toward maintaining continuously high occupancy.

Effective service marketing for your hotel starts with an analysis of your local competitors. Research their prices, amenities and occupancy rates to ensure your services and prices are competitive. Also examine their marketing methods to identify successful tactics. Renting billboards near a highway or airport, for instance, might attract last-minute reservations, but only if you offer the specific services those travelers are looking for.

Determine what services your prospective customers want. If you operate a luxury hotel, your well-off customers might want high-quality restaurants, tennis courts, saunas and other luxury amenities. If possible, hire a reputable marketing consultant to help you identify the target market that offers you the most potential for profit, which can help you customize your hotel’s services for maximum appeal.

Your marketing efforts should promote the services your target customers desire most. If you operate a hotel near an airport, advertising your free and convenient shuttle service might convince travelers to stay with you. If your hotel depends on business travelers, a well-equipped gym and a 24-hour business center are key attractions. Offering assistance with finding local attractions will bring in recreational travelers, as will rooms that oversee local scenery.

Product marketers can use a single marketing strategy to maintain high sales. Service marketers, however, must keep fine-tuning their services to match shifts in their local markets. Your hotel might need different marketing campaigns for each season as different types of travelers become your primary sources of profit. Continual research and careful monitoring of your competitors are the only ways to maintain competitive services and prices.