Cost Saving Not at the Cost of Brand Experience

In an uncertain world, we seek for certainty. When managing business profitability, cost saving strategy brings that certainty and as result we latch on to it. And then we build tactics around the strategy of cost saving. 

Here are some tactics of a 5 Star Hotel to live the cost saving strategy:

  • Remove coffee and tea urns and replace them with sachets 
  • Remove fresh milk and get UHT milk pods 
  • Reduce the number of service staff by 15 %
  • Reduce the number of TV channel subscriptions 
  • Remove the fresh fruit basket from the guest room 

After a month, there is a celebration in the executive boardroom,the profitability increased but after a few months of increased profitability the numbers went down. 

What happened? 

The guest who repeatedly patronised the hotel, realised that the  brand experience is not consistent and moved on to another hotel.
The boardroom joy disappeared as the numbers fell even more. Are your cost saving measures costing you your brand experience?

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