Survival of the Fittest
By Scott and Allison Crumpton

The combined effect of the recession and the events of September 11 have had an enormous impact on the B&B industry. The result of these two events has caused inns to migrate into one of two camps. There are those who have gone (or are going) into financial survival mode and those who are foraging on the remaining tourism industry.

Survival Mode

Survival mode is based on the belief that the change in financial climate is short-term. It is a self-protective mechanism which says "If I hibernate, I can conserve energy and emerge in the Spring unscathed by the harsh financial winter." Many innkeepers are doing just this - some out of necessity. They are hunkering down to wait out the winter expending only minimal financial resources. Generally the first expenditure to be cut is marketing. Since marketing is the life-blood of business, this reduces income which precipitates the need to further cut overhead and thus marketing. The result is a downward spiral into self-imposed hibernation which was, after all, the intended result. The assumption is that once winter passes, they will emerge from hibernation to find business as usual and pick up where they left off.

Dangers of Survival Mode

There are two dangers involved in self-imposed survival mode. The first is the assumption that when they emerge from hibernation, they will have business. In reality, they will be starting over and it will take time to regain the business they had prior to hibernation. The second assumption is that they will survive the financial winter at all. Unlike the seasons, financial winters have no predetermined end and Spring could be years away. Survival mode is risky but unfortunately a necessity for many smaller inns who lack financial reserves.

Symptoms of Survival Mode

It's pretty easy to spot an inn going into survival mode. Print advertising and membership in state B&B associations are generally dropped first. They then take on a do-it-yourself approach toward Internet marketing. This includes either managing the web site themselves or accepting the offers of a relative or close friend to handle the job. More importantly, they begin dropping out of Internet lodging guides which for years have brought them tons of reservations. The pattern is predictable and an increasing number of inns are following this pattern daily.

Foragers

Foraging is based on the belief that the change in financial climate is simply a decrease in available resources. It is an optimistic attitude which says, "There's still plenty of business out there, I just have to work harder to find it." Recently we have seen several innkeepers begin foraging for more business. To the amazement of many (especially their competition), they are doing better than ever. Expanding your marketing while your competition diminishes theirs has a doubly positive effect. Since marketing is the art of spending a dime to make a dollar, your efforts can really pay off when your competition spends nothing at all.

Smart Foraging

Start with a professionally designed web site. This is the best selling tool you have and your most important asset -- so why leave it up to amateurs? I am constantly amazed at the unprofessional appearance of many B&B web sites. Amazingly, the innkeepers are rarely aware of this fact. Their defense is that "everyone loves my web site." Correction, everyone who mentions your web site says they love it - there's a big difference. Having seen the web sites in question, we can either determine the traveling public has very poor taste or the innkeeper is not hearing from all those who went to the competition. I assure you, the traveling public not only has good taste but frequents the establishments with the more professional web site. When you consider the cost of a top quality web site is equal to only a handful of reservations, you have to reconsider your Internet presence with a more critical eye. Then and only then do you need to start promoting your web site. When you do, the smart forager hires a professional to handle the task.

Survival of the Fittest

Competition for scarce resources always creates winners and losers and I foresee many inns closing their doors in the coming years due to prolonged hibernation. The boon economy of the 90's created many start up B&B's - perhaps too many for these leaner times - it is inevitable that a small town simply will not support 10 B&B inns.

If you're going to survive this financial ice age, you're going to have to evolve into a forager or you will become extinct. While many are choosing Survival Mode, the smart marketer can always forage up enough business to survive and often thrive. Slim pickings also create specialized feeders - we call these niche markets and they are yet another part of smart marketing. If you have the resources, now is the time to expand your marketing efforts. The risks are low and the potential gain is enormous - especially while your competition is hibernating the winter away.

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