Today has been very STRESSFUL. I’ve just come back from meetings with my business counselors and then my local bank.
1) I'm having a disagreement with my business counselors. They feel my marketing plan is lacking. However, I feel I've laid out a full marketing plan and covered all my bases including:
- submission to the major hostel booking sites
- membership in state and national travel industry associations
- submission to travel guides
- submission to free accommodation sites
- disbursement of rack cards / brochures to key hostels worldwide
I cover everything from creating a professional website and blog to optimizing Google adwords but they're still not happy with that. They keep talking about Grand Openings, balloons, ribbon cuttings, cookies, cake, inviting the Mayor, orchestrating a huge sweepstakes with vouchers for a FREE night's stay, full color banners at all the major airports. WTH?!?!?! I don't see any of this having anything to do with promoting my hostel but the idea puts smiles on their faces. Am I wrong? They keep telling me my business plan is great but that I’m not showing them how I’ll bring in customers. If I’m missing something important let me know.
2) The business consultant at my local bank didn’t even bother to review the business plan. I was told flat out the business was considered HIGH RISK. Basically, they gave me the cold shoulder and wished me good luck. I’d be happier if they’d told me I didn’t do my homework or the idea was bad but I got nada.
I feel sick. I need advice – please help! :(
15 years
Maybe nonsense is the wrong word because it's all a part of the game. But some days like today I don't know how I'll manage. It's like no one understands or I'm not understanding them or both. OK, I'm just having a bad day. Sorry to rant. :(
15 years
I guess it is just the usual treatment you get from the banks because they have no idea what makes a great hostel (rarely there are exceptions).
most of those guys have never even been to a hostel, so there is very hard to get them on the same level you are on.
there has been some talk about that bank-hostel financing relations already on this forum, plenty of stressful situations for sure
I think your plans looks ok, maybe you can add (if not already) some discounted beds in the first few months. As we all know word of mouth is your best marketing channel so you need to get those mouths to your place :)
and banks are usually all about the numbers (my experience with them) so if you get the numbers right they go for it
15 years
They keep talking about Grand Openings, balloons, ribbon cuttings, cookies, cake, inviting the Mayor, orchestrating a huge sweepstakes with vouchers for a FREE night's stay, full color banners at all the major airports...
Inviting the mayor??
15 years
Ask your banker if his kids have stayed in hostels. That did the trick in our case. He really asked his daughter and she was travelling in Australia for a few months. She made him thrilled.
Business counselors? Can you fire them? You don´t need any. They are all wrong, because they have no idea about hostels.
Chico´s advice about discounted beds is good. We did exactly that when we opened in Berlin - all dorm beds for 9 Euros for the first two months. We were almost full from day one and we opened in the middle of death season - February 15.
Inviting the mayor might not be a bad idea. It won´t cost you a cent. Where the mayor is, there are journalists and you never know if it could help you someday if the mayor (and those journalists who came along) know your business.
When Meininger opened in London, they invited the queen, no less. She really came round! I can´t imagine she recommended the hostel to her friends though! :D
15 years
THe mayor thing and the ribbon stuff is hillarious!
I would have flyers with discounts and make specials like valentine´s day suites, concert discounts, groups ratings, st patrick´s day´s specials, you know...
15 years
When Meininger opened in London, they invited the queen, no less. She really came round! I can´t imagine she recommended the hostel to her friends though! :D
Please, don't overestimate Meiningers marketing division (and Meininger at all) :D Meininger London is situated in the Baden-Powell house, headquarter of scouts. The old lady just came because a statue of her was unveiled. ;)
15 years
I don´t overestimate them at all. The fact of the matter is - they check on Hostelworld when we run out of availabilities and then they raise prices for these days. That´s as close to admitting defeat as it gets. :D
15 years
OK, ok so what I'm hearing is maybe inviting the mayor for an official ribbon cutting with the press and cake and balloons isn't such a bad idea after all then? However, it's something that is usually done by B&Bs. I was thinking it'd draw the wrong kind of attention to the business - area locals. The last thing we want is a hostel full of locals or noisy locals knocking on the door curious to take a look around because there are no hostels here. We don't plan on taking in any locals whatsoever.
The business counselors have been very helpful they just don't understand that I can't market a hostel like a B&B. It's two different concepts. Despite their opinions I'll stand my ground. The thing with the bank that got me was as soon as they labeled my business HIGH RISK they completely shut down. They weren't interested in anything else I had to say. What do you do then? I was told to shake it off and just approach the next bank and go from there until I can find the right bank. The banks are much smarter than I thought. They know what a hostel is but how do I get past the HIGH RISK label. These days banks don't want to touch anything high risk at all.
15 years
Well... inviting the mayor is still pretty useless in my opinion, but it won´t cost you anything, so what the hey. If it makes those counsellors happy why not.
Re: locals: I think it´s important your neighbors know what a hostel is (i.e. not a homeless shelter!); invite them when you open. Angry neighbors can be a real pain in the ass. Show them you´re a nice guy.
15 years
Well... inviting the mayor is still pretty useless in my opinion, but it won´t cost you anything, so what the hey. If it makes those counsellors happy why not.
Re: locals: I think it´s important your neighbors know what a hostel is (i.e. not a homeless shelter!); invite them when you open. Angry neighbors can be a real pain in the ass. Show them you´re a nice guy.
It's not my job to make the business counselors happy. They're there to offer free advice whether I take it or not is my choice. You mentioned it might not be a bad idea so I was just reconsidering it. I'm happy to hear that you guys agree none of it is necessary though. As for the neighbors, it's not an issue because it's a high traffic business district. But I agree, if it were a small residential neighborhood it'd be best to have an open house and educate people before they started whining about the "halfway house" opening next door to them. :p
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