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Revenue Management Woordenlijst

Discount – Transient Sub-segment


The Discount Market Segment, a sub-segment of transient market, refers to guests who are offered rooms at a reduced rate based on pre-determined variables, such as marketing promotions, seasonal discounts or last-minute deals.

Hoe te gebruiken

The decision to discount should only be done as a short-term strategy, as prolonged discounting can erode a property's brand value and image. The decision to offer discounts should only be undertaken based on the recommendation of a sophisticated RMS which considers current occupancy levels, expected market demand and which uses dynamic pricing. It is often preferrable to offer discounts only on direct bookings, as they have a lower cost of acquision and which yield higher ADR but have less potential for large increases in occupancy; whereas, promoting discounts through the OTAs can reach a broad audience quickly and effectively (resulting in an increase in occupancy but can decrease overall ADR because of high commissions). The decision on which channel to offer discounts through should be made strategically based on the specific goals that you are trying to achieve.



Verwante termen

Business on the Books (OTB), RevPAR, Occupancy, ADR, Cost of Acquisition, Direct Booking Channels, Travel Demand, Revenue Management, RMS
Guests who fall under the discount segment are very price-sensitive and are motivated by discounts off the room rate or other promotions which give them more value for their money, including “stay for three nights, pay for two” deal, or bundled offers including other on-site services (i.e., spa treatments or dining). I find the discount segment particulary useful when I need to maximise occupancy and revenue, especially in times of low demand, so I create these types of discounting strategies and promotions to appeal to this valuable audience.

Sarah Kock

Sarah Kock