On Friday Smith Travel Research (STR) and STR Global released September 2008 Worldwide Hotel Performance Results study, which indicated that "the global hotel industry recorded declining occupancy rates and mixed average daily rate and revenue per available room results for the month of September 2008. Data for reports was gathered from more than 36,150 hotels comprising 4.93 million guestrooms worldwide."

The study showed that hotel occupancies worldwide have dropped by between 4.9% in Europe to 12.4% in Asia/Pacific, with Americas declining by an average of 5.7%. The good news is that average rates have remained generally steady, reflecting, as noted by James Chappell, managing director of STR Global, that  “the industry seems to have learned from previous cycles that discounting in and of itself is not enough to stimulate demand and is, in most cases, counterproductive.”

As occupancies drop, hoteliers' reactions have been to slash costs and decrease capital expenditure levels. On the other hand, keeping an eye on the top line and protecting your occupancy and RevPAR is equally important.

CRM can be a great tool to help you compensate for the decreasing demand and fight for a larger share of the smaller market. Here are some tips for how to take advantage of your CRM application and increase your chances for success.

1. Make sure that you keep your existing customers loyal. They are slashing costs too and trying to optimize their travel budgets. They may also be looking for hotels providing them with additional advantages for their own business. You have to be there when they go through this process and offer them compelling reasons for staying in your hotel versus your competition. CRM will help you identify your top 10, 100 or 1000 customers, engage with them directly and modify your offering to target their specific travel patterns, preferences and stay requirements.

Toubleshooting situations when a customer is unhappy is equally important. Online survey forms and customer questionnaires provide an excellent tool for knowing when and how to react. Feedback from quality assurance and rapid response systems needs to be analyzed in a timely manner, and CRM provides the tools for actioning on this information.

2. Target your competition. Your competitors' customers may also be re-evaluating their existing relationships. Use your CRM to conduct active marketing campaigns so that your hotel stays in people's minds when they are looking for alternative accommodation providers in your area. Make sure you include your unique value propositions and a clear indication of cost value that may entice your competitors' customers to come to you.

3. Streamline your direct sales efforts. In a down economy, staying efficient when attracting new customers is very important. Every sales and marketing dollar that you spend has to be precisely targeted. You need to better coordinate your sales team's activities and keep their focus. CRM offers great tools to achieve this, but discipline is of primary importance. Every call needs to have a purpose, it needs to be logged into the system and analysed on a daily basis. Customers' reactions to your offers need to be tracked and you need to know what exactly your clients are looking for. Your sales executives need to have clear targets and the CRM system will help you monitor each person's performance.

4. Take advantage of your hotel's business services, meeting space and conference facilities. Some customers may be downsizing their own office space or even shutting down regional branches. They will look to outsource their business services needs. Others may be looking for ways to optimize their event spending. All of this provides an opportunity for you to attract new business and offer the advantage of your facilities. Use your CRM to better market your business and conference services, keep the sales pipeline full, optimize meeting space utilization and efficiently engage with your customers when they are trying to buy.

In a down economy, it may come to the point of whether it's you or the hotel next door that will stay in business. Being clever and efficient with CRM is one way of ensuring that it is you.