Anatomy of an Irrelevant Hotel Product

Why Most Hotels Lack a Clear Proposition… and How That Condemns Them to Compete on Price

There are hotels that lose money even when they are full. There are hotels that believe they are competing against other hotels… when in reality they are competing against indifference. And there are hotels that have been destroying value for years without realising it, because they have confused having rooms with having a product. Most properties do not have a sales problem. Not even a marketing problem. They have a much deeper and more dangerous problem: they are unable to explain, with brutal clarity, why someone should choose them rather than the hotel next door. And when that happens, the market always imposes the same punishment: a price war.[cre_gate] I have seen it far too many times. Hotels with multi-million investments, immaculate spas, spectacular rooftops, ambitious restaurants, refurbished rooms and flawlessly executed marketing campaigns… that still fail to generate genuine desire. The guest arrives, compares, and ends up asking only what the nightly rate is. Because when a product does not communicate a clear difference, price becomes the only rational decision-making criterion. And this is where one of modern hospitality’s great silent tragedies emerges: many hotels believe they have a product because they have facilities. But a hotel product is not a collection of services. It is a clear promise of transformation for a specific type of guest. The problem is that the sector has spent decades building hotels from the inside out. Thinking about departments, categories, investments, competitors and trends. Very few have built their proposition from the guest’s perspective. Very few understand the space they truly occupy in the market’s mind. And that explains why so many hotels feel that “selling is becoming harder and harder”. Selling is not getting harder. Selling irrelevant products is getting harder.

The Epidemic of Hotels That Are “Everything to Everyone”

One of the clearest symptoms of an irrelevant product is the obsession with pleasing everyone. Hotels that want to be:

• Boutique
• Lifestyle
• Wellness
• Gastronomy-led
• Corporate
• Pet-friendly
• Family-friendly
• Adults-only
• Events-focused
• Coworking
• An emotional retreat
• An Instagram-worthy destination

All at the same time. The result is often devastating: a confusing proposition, devoid of strategic tension and incapable of creating a position in the guest’s mind. Because positioning is not built by saying many things. It is built through what you choose to give up. In hotel strategy, clarity is more profitable than breadth. Memorable hotels tend to have something in common: they are easy to understand. Guests know exactly what to expect, how they will feel and why they should pay more. By contrast, irrelevant hotels create cognitive friction. They force guests to work out what they are. And when a guest has to interpret too much, they walk away. The problem is that many properties believe adding services increases value. But in hospitality, adding without coherence usually erodes perception. I have seen hotels add empty spas, loss-making rooftops, unmanageably extensive menus, coworking spaces with no users, or wellness concepts completely disconnected from the property’s DNA. All of it funded by significant investment and presented as strategic innovation. But a hotel product is not defined by what it includes. It is defined by what it means. And that is where most fail. Today’s guest does not buy square metres. They buy identity, emotion, belonging and narrative. That is why some simple hotels achieve extraordinary occupancy while others, far more sophisticated, survive on a steady diet of discounts. Because the market does not necessarily reward the best hotel. It rewards the easiest one to understand. When that alignment disappears, the hotel enters an extremely dangerous zone: it starts to look too much like everyone else. And when everyone looks the same, price destroys margin.

How a Hotel Product Dies

Irrelevance does not appear overnight. It slowly seeps in. It begins when a hotel stops making uncomfortable decisions. When it stops asking itself:

• What type of guest do we NOT want?
• What experiences do we NOT want to offer?
• Which channels should we NOT be feeding?
• What expectations do we NOT want to create?

At that point, the hotel begins opening too many doors. And a hotel with too many open doors eventually loses its identity. The most dangerous part is that irrelevance often comes disguised as apparent operational success:

• Reasonable occupancy levels.
• Good review scores.
• A steady flow of guests.
• Intense commercial activity.

But behind all of that, one unmistakable sign emerges: every year, it becomes harder to fill the hotel. More marketing investment. More dependence on OTAs. More discounts. More campaigns. More promotions. More pressure on Revenue Management. And still, lower profitability. Because Revenue Management cannot solve an irrelevant product. It can optimise demand. It can manage inventory. It can protect ADR. But it cannot create desire where perceived value does not exist. In fact, many hotels are using pricing to conceal structural product problems. And that is extremely dangerous. A hotel that needs constant discounting to generate demand is already sending the market a message:

“My value is not enough.”

The guest learns very quickly. And when they learn that a hotel always ends up lowering its prices, they stop booking out of desire and start booking because of the deal. That is where the most destructive vicious circle in modern hospitality begins:

1. The hotel loses differentiation.
2. It competes on price.
3. It attracts less loyal demand.
4. Average spend declines.
5. Margins shrink.
6. It has less capacity to improve the product.
7. It loses even more relevance.

And then it starts all over again.

The Hotel Benchmarking Trap

Another common mistake is building products by looking only at the competition. It is one of the sector’s most dangerous habits. Many hotels make strategic decisions like this:

• “The hotel across the street has added a rooftop.”
• “The competition offers brunch.”
• “Everyone is doing wellness.”
• “Lifestyle is what is trending now.”
• “We need to look more premium.”

The problem is that copying visible elements does not mean copying positioning. Because what is visible is rarely the real competitive advantage. The advantage is usually found in far less obvious elements:

• Coherence.
• Culture.
• Narrative.
• The type of guest.
• Emotional consistency.
• Experience design.
• Strategic clarity.

When hotels copy one another, the market fills with diluted versions of the same ideas. And then something fascinating happens: they all end up looking modern… but none of them is memorable. Hospitality is entering an era in which true luxury is not about having more. It is about having meaning.

The Most Uncomfortable Question of All

There is one question that very few hotels dare to answer honestly:

“If we disappeared tomorrow, would anyone truly miss us?”

I am not referring to occasional guests. Nor to positive reviews. Nor to satisfied guests. I mean genuine relevance. Because many hotels operate. But very few matter. And that difference changes the business entirely. Relevant hotels generate:

• Greater loyalty.
• Lower price sensitivity.
• More direct bookings.
• More repeat business.
• A stronger organic reputation.
• Greater ability to defend ADR.
• Greater structural profitability.

Irrelevant hotels generate volume. Relevant hotels generate power.

How to Build an Irresistible Hotel Product

Over the years, I have learned that the strongest hotels tend to share several very specific characteristics:

• They have an exceptionally clear proposition They do not try to explain twenty concepts. The guest quickly understands what experience they are buying.
• They embrace strategic trade-offs They understand that saying “no” is part of positioning.
• They design for a specific guest They do not try to please the entire market.
• They build coherence Everything communicates the same identity: architecture, communication, gastronomy, service, music, rhythm, language and experience.
• They do not chase trends desperately They filter every innovation by asking:

  “Does this reinforce who we are… or is it simply trying to look modern?”

• They compete on perception, not price They understand that perceived value always comes before profitability.

One of the major problems in contemporary hospitality is that many properties have optimised operations before defining meaning. And a hotel that is highly efficient… but strategically irrelevant… is still irrelevant. Modern hotel strategy is not simply about managing assets. It is about building perception. Because ultimately, guests do not compare hotels alone. They compare stories. Feelings. Identities. Versions of themselves. And that is where the real battle lies. The hospitality of the future will not necessarily belong to the largest, most technological or most sophisticated hotels. It will belong to the hotels capable of answering one very simple question with clarity:

“Why should someone choose us… even if they have to pay more?”

Hotels that cannot answer that question precisely will remain trapped in the same silent war as always: more discounts, more dependency, more pressure, more volume, less margin. And they will probably never understand that the problem was not the market. It was irrelevance.