Our global survey of 450 senior revenue decision-makers revealed a surprising paradox. Hoteliers feel confident in the effectiveness of their revenue management practices, yet many fall short on some of the fundamentals.
While 79% of respondents believe they are maximizing their revenue potential, only 36% review their pricing strategy at least monthly, and only 40% forecast demand at least monthly.
This raises the question: How can hoteliers be so confident in their revenue outcomes when some basic revenue management practices are being overlooked?
Demand Is in Constant Flux
In the early days of revenue management, hotel pricing was relatively simple. Room rates were often set seasonally and adjusted only occasionally throughout the year.
Today, demand is in constant flux. Even for small properties in remote locations, market conditions can change frequently based on factors like occupancy, booking pace, competitor rates, local events, weather and shifts in demand.
As a result, more accommodation operators are adopting dynamic pricing – adjusting room rates frequently in response to changes in demand and market conditions.
When almost two-thirds (64%) of operators review pricing strategy only once a quarter or less, it raises questions about whether their strategies are keeping pace with changing market conditions.
If your pricing doesn’t move with demand, it can quickly fall out of step with current market conditions and competitive positioning. And that could be costing you revenue.
Forecasting and Pricing Go Hand in Hand
So how do you anticipate changes in demand and know when to adjust your rates?
Demand forecasting is the process of predicting how much demand a hotel can expect for future dates based on factors like booking trends, historical data, and market conditions.
Forecasts provide the foundation for pricing decisions by indicating whether demand is strengthening or weakening, helping hoteliers determine when rates need to change and by how much.
Yet 35% of survey respondents say they forecast demand only quarterly, while 23% do so twice a year or less often.
When forecasts and pricing strategies are reviewed that infrequently, there’s a greater risk that room rates won’t reflect actual demand.
Martijn Barten of Revfine says the point isn’t a perfect prediction:
“The purpose of forecasting is not necessarily to predict the future with perfect accuracy. Its real value is in understanding your business… By forecasting regularly, hotel management stays closer to the business, identifying opportunities and threats early enough to act proactively rather than react when they occur.”
The Ingredients of Effective Pricing
Most hoteliers recognize the key inputs to effective pricing.
The vast majority of survey respondents said their pricing decisions are at least somewhat influenced by local market activity (88%), competitor rates (88%), demand forecasts (87%), and historical performance (85%).
In fact, demand forecasts received the highest “very influential” rating of any factor, at 52%.
And therein lies the real disconnect: a mismatch between how much weight hoteliers place on demand forecasting and how often they actually do it.
One explanation may be that while hoteliers understand the importance of forecasting, they simply don’t have the time, expertise, or technology to forecast as often as they’d like.
And that brings us to another key finding from the survey: the role of automation.
Where Automation Fits In
One might assume that properties using a revenue management system (RMS) have less need to review pricing strategy because so much of the work is automated.
Yet our data found that RMS users review pricing strategy and forecast demand much more frequently than operators without an RMS.
This highlights an important distinction between day-to-day pricing and pricing strategy. An RMS can optimize prices all day, every day, freeing hoteliers from the need to constantly monitor demand and manually adjust rates.
But hoteliers still need to decide which guests to target, which channels to prioritize, and which pricing strategies to follow. That means regularly reviewing pricing strategy and updating RMS settings as priorities and market conditions change.
Rather than replacing strategy, technology creates more time and headspace for it. Yet across all survey respondents, one in four accommodation providers review pricing strategy only twice a year or less.
Closing the Confidence Gap
For many operators, more frequent forecasting and pricing reviews represent one of the clearest opportunities to strengthen performance and narrow the gap between confidence and practice.
How often these activities need to take place will depend on factors such as the size of the property, booking volume, market volatility, and resources available.
For any property, the important thing is to ensure pricing keeps pace with demand. Only then can you be truly confident you are maximizing your revenue potential.
Download the 2026 State of Revenue Management Report to learn more about operational challenges, leadership, technology, collaboration, and other key topics in modern hotel revenue management.
To learn how RoomPriceGenie can help your property increase your property’s profitability, start your free trial of our automated pricing solution today!
