11 March 2010

How can independent hoteliers survive?

TravelMole guest comment by Tom Magnuson, joint CEO and founder, Magnuson Hotels

As an American I have to admit there are plenty of things about the UK that leave me confused.

Forget the whole ‘two nations separated by a common language’ thing; I mean, some of you guys have gravy on your chips, right? And what exactly is black pudding?

Cultural differences like this have occupied my thoughts recently, since I’ve been immersing myself in what makes Brits tick when it comes to choosing a hotel.

And at the end of what has been a pretty exhaustive process, I suppose I shouldn’t be surprised that you are no different from my countrymen across the pond. Price, convenience, quality and availability are common concerns to us all.

In the US Magnuson Hotels, the company I started with my wife Melissa in 2003, has become something of a phenomenon and now represents more than 1,000 independently run properties. I can’t begin to explain how amazed, and humbled, I am at our growth over these last seven years.

I suppose we hit a nerve. We realised that independent hoteliers were struggling to attract clients because they often operate in the shadow of their better resourced big-chain rivals. As a result, the only option was to sign up to a franchise themselves - effectively handing over their independence while incurring significant costs.

Our model works differently. By signing with Magnuson we give hoteliers the freedom to do what they do best - run their hotels - while we do the marketing to deliver the bookings.

Our GDS representation and reporting tools mean we open properties up to the lucrative corporate market. Hotels also find themselves distributed via more than 2,000 online channels - including the biggies such as Expedia - which means leisure travel agents and consumers can actually see them and book them. And that is the major battle won.

Other benefits include access to our own bespoke technology that lets hoteliers manage their reservations and yield. There are no big charges either - members only pay us commission on the bookings we actually deliver.

Unfortunately, independent hotels in the UK are failing at a terrifying rate and according to a recent report by PricewaterhouseCoopers, it’s the non-affiliated hotels that are most a risk in a struggling hospitality sector.

As a tourist and committed anglophile, it saddens me to think that brilliant businesses that are an integral part of the country’s attraction - be they grand seaside guesthouses or elegant country homes - are closing their doors forever to visitors.

As an American, I do know that I can’t come over here and say I’m going to save Britain’s independent hotel industry.

But I will say that we are launching in the UK to help your hoteliers keep doing what they do well… even if that means being famous for a fantastic fry-up that includes black pudding.

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Your Comments (3)

No start up fees, no monthly fees, no long term contracts

Magnuson Hotels offers an easy solution for hoteliers to be highly visible and available to book reservations in only three weeks on the world's largest online distribution system. Affiliates pay only a 15% commission on reservations delivered, and do not pay for no-shows or shorter stays than booked. Every hotel is assigned a personal market specialist to assist with rate strategy, online appearance and positioning.

By melissa magnuson, Friday, March 12, 2010
No fees, no long term contracts

Becoming an affiliate of Magnuson Hotels is easy, without upfront costs or long term contracts. Hoteliers pay only a 15% commission on reservations delivered from our worldwide distribution system. They do not pay the commission on no-shows, or shorter stays. Hoteliers joining Magnuson Hotels can expect to be live in all online distribution channels within 3 weeks.

By melissa magnuson, Friday, March 12, 2010
Good but how much is the fee

Anything that can help hoteliers has to be good. The question is what's the commission fee going to be?

By Norm Peters, Thursday, March 11, 2010