Businesses are facing the same drawbacks in today’s hospitality industry. The competition is intense. The market is overcrowded. Home-sharing and online travel agencies seem to be taking over. Strategies for growth all look the same and do nothing to set one property apart from the others.
The problem when you compare yourself with the competition as a strategy to beat them out is that, instead of setting yourself apart from the competition, you really start to imitate them. You think that what works for them will work for you, and ultimately wind up mirroring their strategies to help drive your own success.
This is what it is like to compete in a “red ocean”—one that is crowded with cutthroat competition who are all pursuing the same opportunities for technological and financial growth. But what if you stopped focusing on competing and started focusing on creating?
I had the opportunity to listen in on this very idea as it was presented by Michael Levie, VP of Hospitality Financial & Technology Professionals, during the 2019 Executive Vendor Summit. The event was held earlier this year in Austin, Texas, and was hosted by Hospitality Upgrade in partnership with HFTP.
Levie called this idea of market creation the “blue ocean shift,” and he explained how it can take your business from the crowded red ocean of competition to a blue ocean of uncontested market space. It is a strategy that has worked wonders for citizenM hotels, where Levie currently serves as chief operating officer.
So, how can you make the shift? It requires you to do two things: Differentiate your product and make the competition irrelevant.
Start by changing your focus. When you spend too much time concentrating on what the competition is doing in today’s current market, you lose the opportunity to create a new market that works for you. Focus instead on what it is that will truly differentiate your product from others. When you stand apart on your own, you make the competition irrelevant. Only you can provide the experience you are offering.
Be smart about the decisions you make to differentiate your product. You can increase value without raising costs. You can create a personalized customer experience that will save your guests time and energy without sacrificing human interaction. And you can put the right aesthetics and assets in place that will make a lasting impression.
To know what decisions to make, you need to figure out who you are. What is your vision for the property? Who is your ideal guest and what is most important to them? Defining your market segment and target audience will help you ultimately define your brand.
You can explore this concept in depth and follow its five-step process by reading “Blue Ocean Shift,” written by professors W. Chan Kim and Renée Mauborgne.
Frank Wolfe is the CEO of Hospitality Financial and Technology Professionals. He can be reached at [email protected].