Underperformance does not have to be permanent. Where we start when a hotel is struggling: a clear diagnosis, then focused work on guests, pricing, costs, and team.
Every hotel faces challenges at some point, and underperformance does not have to be permanent. Many hotels struggle with low occupancy, weak guest satisfaction, or inefficient operations. With a clear diagnosis and a focused plan, these properties can recover. This post covers the practical strategies we use when helping owners and operators work on an underperforming hotel.
Assess the Current Situation Thoroughly
Before changing anything, understand why the hotel is underperforming. That means a detailed look at every part of the property:
- Financial review: Analyze revenue streams, expenses, and margins. Find where costs are too high or revenue is slipping.
- Guest feedback: Read reviews on platforms like Tripadvisor and Google, along with direct surveys. Look for recurring complaints and suggestions.
- Market position: Understand where the hotel sits against its competitors. What does it offer that others do not? How does its pricing compare?
- Operational efficiency: Evaluate team performance, maintenance schedules, and purchasing. Look for inefficiencies and outdated processes.
This review points you to the root causes, and the root causes should drive the plan. In our experience, owners who skip the diagnosis often end up spending money on symptoms.
Improve the Guest Experience to Rebuild Reputation
Guest satisfaction has a direct effect on occupancy and revenue. Improving the experience can turn review sentiment around and encourage repeat stays.
- Upgrade facilities: Renovate rooms, update furniture, and improve the amenities guests use most, such as Wi-Fi, fitness, and dining.
- Train the team: Invest in service training so associates are friendly, responsive, and knowledgeable.
- Personalize service: Use guest data to recognize preferences, such as a preferred room type, or to mark occasions like birthdays.
- Simplify check-in and check-out: Technology can make arrival and departure faster, including contactless options.
Renovation and training work best together. A refreshed room will not carry a stay if the service around it is inconsistent.
Sharpen Pricing and Distribution
Pricing strategy and how rooms are sold play a major role in profitability.
- Dynamic pricing: Use revenue management tools to adjust rates for demand, seasonality, and local events.
- Balanced distribution: List rooms on online travel agencies (OTAs), and also encourage direct bookings through the hotel website with offers available only through direct channels.
- Packages: Combine rooms with dining, spa services, or local experiences to raise average spend per guest.
- Loyalty programs: Use or strengthen loyalty programs to encourage repeat and direct bookings. Program options vary by brand.
Focus Marketing on the Right Guests
Targeted marketing helps attract the right guests and fill rooms more consistently.
- Define the target guest: Business travelers, families, couples, groups, and leisure travelers each need different messages.
- Build local partnerships: Work with nearby attractions, restaurants, and event organizers on joint promotions.
- Keep content useful: Maintain a website and blog with helpful information about the hotel and the area.
- Use email: Keep past guests informed about offers and events.
Bundled offers with local partners, such as tour operators near a seasonal attraction, can be an effective way to build demand for a specific season.
Streamline Operations to Reduce Costs
Cutting unnecessary expense without sacrificing quality improves profitability.
- Energy efficiency: LED lighting, smart thermostats, and water-saving fixtures can lower utility bills.
- Inventory management: Track supplies carefully to avoid overstocking and waste.
- Outsourcing non-core tasks: Consider specialized providers for laundry, certain cleaning, or maintenance work.
- Staff scheduling: Build shifts from occupancy forecasts.
Invest in Technology for Better Management
Used well, technology improves both efficiency and guest satisfaction.
- Property management systems (PMS): Manage bookings, billing, and housekeeping assignments.
- Guest communication tools: Apps or messaging platforms make it easier for guests to reach the team.
- Online reputation management: Monitor and respond to reviews promptly.
- Data analytics: Study booking patterns and guest preferences to inform decisions.
Choose tools that solve problems your diagnosis actually found, and make sure the team is trained to use them.
Build a Strong Team Culture
A motivated, well-trained team delivers better service and is central to any turnaround.
- Regular training: Provide ongoing training in service, safety, and operating procedures.
- Recognition: Reward strong performance and teamwork.
- Open communication: Create an environment where associates can share ideas and concerns.
- Clear goals: Set measurable goals for departments and individuals so effort points in the same direction.
In our experience, hotels with strong team cultures tend to keep their people longer and deliver a more consistent guest experience.
Where to Start
A turnaround begins with an honest diagnosis, then a prioritized plan, then steady follow-through. Our remediation work follows that sequence. We work with owners and operators to diagnose the challenges, build a plan tailored to the property, and track progress as changes are made.
If your hotel is not performing where it should, learn about our planning and remediation services and operational training, or Request a Proposal to talk through your property.
