Differentiation has become a new strategy within the hotel industry to obtain higher profits and a competitive advantage. the hotel factory outlines how to recognize if differentiation is right for your company.

For a hotel to be just a place to sleep is no longer what clients are looking for. The need to offer a more complete experience to be remembered has become a patent for hotels.

It’s for all to see that the hotel industry has changed considerably in the last years and is going to continue to do so. One of the aspects that has been and will remain the most influential is the tendency towards differentiation. Facing an excess in supply in the market, differentiation is the only possible alternative to ensure a demand for your product.

To replicate the traditional “sun & beach” holiday hotel with a massive all inclusive supply, based on a poor interior design with hardly any atmosphere, has ceased to be the chosen path for those who wish to open a new hotel, especially in mature destinations with highly consolidated competitors.

Furthermore, pursuing this differentiation objective, hotel refurbishments are no longer just a “necessary investment to maintain a hotel” or simply a “facelift”. They have become, in certain occasions, a real work of art worthy of architectural or design prizes. A refurbishment project has to be screened as an opportunity to stand out and improve the hotel’s online reputation, not as an Odyssey of hardships and expenses.

Differentiation needs to be understood as one more strategy in the hotel industry, that in certain occasions will be convenient to use and in others not, meaning that it should be seen as a Utopia, since sometimes it could not turn out profitable or advantageous. As in many things in life, the more capital and effort is devoted to the investment in differentiation, the greater will be the notoriety of what the asset can reach to differentiate; on the other side, if the aim is a minimal investment, changes won’t always be perceived by clients.

To open a hotel in a former prison, zoo, church or a bullfighting ring, or to build a hotel with materials like cork, salt or ice, are some of the most “radical” cases of differentiation, that in many cases, require a high investment and have a longer period of return on investment, given that in these cases hotels have a small number of rooms.

Yet it is not necessary to resort to these extremes to pursue the awaited differentiation. Some examples of differentiation strategies that allow a hotel to obtain competitive advantages with an “affordable” investment, are: to specialize in a particular market segment, such as sport, to decorate a hotel with an interior design as in an art gallery, to theme a hotel or include new technologies in the most basic processes of the hotel.

To conclude, we should to ignore that differentiation goes hand in hand with the increasing trend of personalizing services, with the aim to accomplish a more flexible product, more adapted to consumption patterns and the client’s needs. Therefore, reach higher satisfaction levels. To this effect, and to find a suitable differentiation strategies for each type of hotel, the true paradigm of differentiation lays in knowing your clients tastes and preferences in order to satisfy them to the fullest.