Free guide: The Benefits of Revenue Management
Deze gids leert je hoe strategisch revenue management de winstgevendheid en operationele efficiëntie van je property zal verhogen, ongeacht hoe de markt verandert. De gids schetst hoe revenue management kan profiteren van het leiderschap in vele operationele afdelingen, waaronder hoteleigenaren / exploitanten, Hotel Managers en Front Desk Managers. Aan het einde van de gids zul je de waarde van geautomatiseerde prijstechnologie begrijpen bij het ondersteunen van je property's revenue management strategie en het maximaliseren van de omzetkansen, zowel op de korte als op de lange termijn.
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Section One – The Benefits of Revenue Management
for hotel owners / operators
Section Two – The Benefits of Revenue Management
for hotel managers
Section Three – The Benefits of Revenue Management
for front desk managers
The Benefits of Revenue Management
for hotel owners / operators
start reading below
There are many benefits of implementing a data-based revenue management practice at a property, especially for the owners/operators who are responsible for ensuring that the hotel remains financially viable.
To effectively implement revenue management, a hotel owner/operator must invest in a sophisticated revenue management system (RMS), as it enables the automated collection, analysis of huge amounts of data, which then provides accurate pricing recommendations in real-time; in addition, when it is connected with a channel manager, the new prices can be automatically updated across the all the online distribution channels, making it a completely hands-off process.
Using RMS technology, hotel owners and operators can leverage the following benefits of revenue management to achieve their overall goal: ensuring the property’s sustained profitability.
Verbeterde besluitvorming
Revenue management-based pricing decisions are based on data, not intuition (eliminating the potential risk of human error). Implementing dynamic pricing using RMS gives hotel owners and operators a wealth of data – including past performance data, real-time market conditions, competitor pricing and more – which is analysed to discern patterns, predict future behavior and make automated pricing recommendations, as the market changes.
Beter begrip van de behoeften van gasten
Door boekingspatronen, annuleringspercentages, verblijfsduur en zelfs het soort voorzieningen waar gasten de voorkeur aan geven te analyseren, kunnen hoteleigenaren en -exploitanten hun aanbod effectiever afstemmen op de verwachtingen van de klant. Inzicht in klantgedrag helpt ook bij het creëren van gepersonaliseerde commerciële en marketingstrategieën, wat kan leiden tot hogere conversiepercentages en een grotere klantloyaliteit.
Concurrerend blijven
Revenue management systems provide benchmarking data that allows hoteliers to compare their performance against their direct competitors within their destination (known as the property’s comp set). Benchmarking is crucial for identifying competitive advantages and areas that need improvement in a property’s operations and pricing strategy.
Verbeterde gasttevredenheid
By finding the proper balance between price, market demand and guest expectations, hotels can increase online bookings and improve the guest experience. It has been proven that increased guest satisfaction can lead to repeat business and more positive reviews, which are shown to increase the property’s perceived value, enabling the property to increase their ADR over time.
Enables better strategic leadership decisions
Revenue management can also inform broader strategic leadership decisions, such as hotel expansions, renovations, service offerings and staff training programs. By relying on accurate market and benchmarking data, owners and operators can ensure that their strategic initiatives are appropriately aligned with market opportunities, guests’ preferences and always focused on improving operational efficiencies to maximise guest satisfaction.
De winst verhogen
By analyzing demand patterns, a hotel’s RMS can update prices to fill more rooms at the highest possible rate, enhancing both occupancy and ADR. Data-driven strategies assist owners and operators improve their resource allocation, ensuring that the hotel’s investments are yielding the best possible returns over the short- and long-term.
But here’s an important caveat… an RMS is critical to a property’s success in today’s highly competitive landscape but there’s another important factor to consider, which is integral for optimal revenue management: the human element.
A hotel’s staff plays a crucial role in interpreting, contextualizing and executing the insights generated by RMS. To be most effective, training staff in revenue management principles goes beyond the operational elements; hotel owners and operators must create a revenue management-first culture. When all team members understand and embrace the importance of revenue management, they can collectively contribute to the hotel’s revenue optimization goals and maximize the ROI on the property’s revenue management activities.
By embracing data analytics to create a strategic approach to pricing and distribution, hotels can improve their financial performance and enhance the guest experience – but only if the owners/ operators are on-board with implementing RMS technology and, also, in training their employees to prioritize revenue management as an operational imperative across all departments.
The Benefits of Revenue Management
for hotel managers
De rol van een Hotel Manager (of General Manager) is veelzijdig en vereist een combinatie van leiderschap, operationele expertise en het vermogen om strategische bedrijfsdoelen te ontwikkelen en toe te zien op de uitvoering ervan.
One of the most important actions that a Hotel Manager must take is to develop the property’s revenue management strategies—a critical component that can make or break a hotel’s financial success. A Hotel Manager should be adept at using revenue management insights for strategic planning, including setting long-term goals, budgeting, and investment decisions. Additionally, understanding the competitive landscape, including competitors’ pricing strategies and market positioning, is vital for maintaining a competitive edge.
To make effective revenue management decisions, Hotel Managers must understand the fundamental principles of supply and demand, segmentation and effective pricing strategies, as successful revenue management is about selling the right room, to the right customer, at the right time, for the right price, through the right distribution channel.
Prijzen 101
Onderzoek toont aan dat hotels die hun kamers hoger prijzen dan de concurrentie over het algemeen meer winst maken, zowel in goede als in slechte tijden. Dit versterkt de noodzaak voor hotelmanagers om vraagvoorspelling en -prognose (zie hieronder) te begrijpen en te integreren in hun revenue management strategie om ervoor te zorgen dat hun prijsstelling accuraat is, ongeacht hoe de markt verandert.
Forecasting and demand prediction
Effective revenue management is predicated on the ability to forecast future demand accurately. There are two ways to predict future demand: manual analysis of past and current booking trends, market conditions and external factors (such as events or holidays), or by using automated pricing technology that will do that all the data collection and analysis automatically, in real-time, freeing up the Hotel Manager to focus his attention on strategic decision-making and on improving the guest experience. Obviously, the latter is a much more effective use of the Hotel Manager’s time, as manual data analysis is time consuming and is prone to human error.
Over geautomatiseerde prijsoplossingen gesproken...
Revenue management technology
Zoals we net al zeiden, is het gebruik van een Revenue Management-systeem (RMS) of een geautomatiseerde prijsoplossing (zoals RoomPriceGenie’s!) leverages data analytics to forecast demand, analyse market trends and competitor pricing and adjust room rates in real-time, ensuring prices are competitive yet profitable. This data-driven approach enables hotel managers to make informed decisions and stay competitive. Automated pricing solutions enhance operational efficiency and provide valuable insights into customer behavior and booking patterns, helping Hotel Managers to increase their property’s occupancy during off-peak times to ensure a steady flow of revenue.
Market segmentation and price optimization
A crucial aspect of revenue management is identifying the most common market segments that make up a property’s guests; common market segments include business travelers, leisure travelers, groups and customers who are part of the property’s loyalty program (a.k.a. repeat guests!).
Each segment has unique booking behaviours and price sensitivities, so Hotel Managers need to understand each segment and how to best set their rates to appeal to the property’s most profitable segments, optimising occupancy and ADR.
Distribution & channel management
A hotel’s visibility across various distribution channels is critical, as it will directly impact the property’s long-term profitability; knowledge of the cost-benefit analysis of each channel and how to leverage them for maximum exposure and profitability is essential for a Hotel Manager’s success in revenue management.
In het algemeen moeten hotelmanagers een grotere nadruk leggen op het stimuleren van directe boekingen (via de brand.com website van het hotel) waar mogelijk vanwege de lagere acquisitiekosten en gebruik maken van online reisbureaus (OTA's) als back-up om de zichtbaarheid en boekingen te stimuleren wanneer de property waarschijnlijk niet op 100% bezetting zit. De basisregel voor het beheren van OTA-beschikbaarheid is als volgt: geef zoveel mogelijk beschikbaarheid door aan de OTA's als je waarschijnlijk niet volgeboekt bent (omdat ze je belonen voor het delen van je inventaris), maar beperk de beschikbaarheid wanneer OTA-verkoop je directe verkoop zal beperken.
Op de OTA's staan geeft hotels een extra bereik en het voordeel van het billboard-effect; dus, hoe meer OTA's een property vermelden, hoe meer mensen je property zullen zien, en hoe groter de kans dat de verkoop converteert (hetzij via de OTA's of direct).
Een belangrijke opmerking: het onderhouden van de aanwezigheid van een property op meer OTA's vereist meer werk, waaronder het instellen van het profiel van het hotel en het bijwerken van inhoud en foto's op alle distributiekanalen wanneer er iets verandert, dus een channel manager is een must-have in de basis tech stack van alle accommodaties. De channel manager maakt het dagelijks relatief eenvoudig om op zoveel mogelijk kanalen vermeld te staan, zonder extra werk of hoofdpijn te creëren.
Tot slot is het belangrijk voor hotelmanagers om de prestaties van elk kanaal voortdurend te evalueren en als boekingen niet converteren op een bepaalde OTA, de inventaris opnieuw toe te wijzen aan een winstgevender kanaal.
The art of hospitality
In de kern draait gastvrijheid om het creëren van een uitzonderlijke gastervaring. Een hotelmanager moet begrijpen hoe de prijsstelling van invloed is op de perceptie van de gast van zijn algehele ervaring om strategieën voor inkomstenbeheer te ontwikkelen die nieuwe omzet opleveren en ervoor zorgen dat elke gast de optimale verblijfservaring heeft. Om dit te bereiken moeten hotelmanagers de gegevens van gasten (uit de CRM) gebruiken om de ervaringen van gasten te personaliseren, gerichte promoties te creëren op basis van de huidige marktvraag en loyaliteitsprogramma's op te zetten die zorgen voor terugkerende klanten en nieuwe klanten aantrekken via positieve mond-tot-mondreclame.
In essence, revenue management is a comprehensive discipline that touches every aspect of a hotel’s operation but for Hotel Managers, a deep understanding of revenue management is imperative for driving revenue growth, ensuring guest satisfaction and achieving long-term profitability. De reis om revenue management onder de knie te krijgen gaat door, vereist voortdurend leren, aanpassen en het vermogen om invloedrijke markttrends, omzetkansen en potentiële mogelijkheden voor operationele of strategische verbetering te identificeren om betere resultaten te behalen.
The Benefits of Revenue Management
for front desk managers
The Front Desk Manager in a hotel is pivotal in orchestrating the first and lasting impressions of guests, managing the reception team to ensure a seamless check-in and checkout process, handling reservations and addressing guest inquiries and concerns – always with the utmost professionalism.
The Front Desk Manager is also responsible for scheduling, training and management of all logistics related to having the rooms ready for guests (i.e., reservations, housekeeping, maintenance, etc.), as well as ensuring that the front desk provides the best possible customer service to guests, 24/7.
In short, the Front Desk Manager is a central figure at a hotel because they ensure the optimal guest experience and are tasked with maximizing operational efficiency. While this role might not be the first one you think of as having an important role in the revenue management process, the Front Desk Manager does play an important, behind the scenes role in the strategic development and execution of a property’s revenue management.
When you remember that revenue management is a strategic approach that not only boosts profitability but also significantly enhances guest satisfaction, it makes it easy to understand that revenue management activities should be intertwined with the roles and responsibilities of a Front Desk Manager, as it will ultimately elevate the guest experience and, as such, improve the hotel’s overall long-term profitability.
Dynamic pricing: a win-win for guests and hotels
Een van de belangrijkste aspecten van modern revenue management is dynamische prijsstelling, wat alleen mogelijk is door de implementatie van geavanceerde revenue management systemen (RMS) voor het automatiseren van de verzameling en analyse van marktgegevens, vraag, seizoensgebondenheid, prijsstelling van de concurrentie, naast andere factoren, en het geven van geautomatiseerde, real-time prijsaanbevelingen.
Een veelgehoorde zorg van veel hoteliers (vooral Front Desk Managers) is dat gasten boos worden en zich "afgezet" voelen als een hotel dynamische prijzen hanteert. In werkelijkheid zal dynamische prijsstelling geen significante invloed hebben op de tevredenheid van gasten over hun verblijf of hen ervan weerhouden om achteraf een positieve beoordeling achter te laten.
In fact, a 2023 Studie ZHAW Universiteit of hotels using RoomPriceGenie’s automated pricing solution showed that guests’ overall satisfaction increased after the implementation of RoomPriceGenie; however, the guests’ ratings for price fairness and their intention to recommend both went down by small amount. (This is most likely because RoomPriceGenie’s solution is designed to help hotels earn the highest ADR possible, and likely, the room rates increased after implementing the solution, to match market value.)
When you dig deeper into the data to examine guests’ intention to recommend the property (before and after the implementation of dynamic pricing), you find that, while the overall intention decreased slightly, the number of people who answered in the top 20% on the likelihood that they would recommend the property increased, which is a positive development as these are the people who would like also leave a positive review for the
property.
In het algemeen veranderde ook de perceptie van de gasten van de prijzen van de woningen in het onderzoek: na de implementatie van RoomPriceGenie zagen meer gasten de prijzen als dynamisch, wat een positief resultaat is omdat het impliceert dat gasten begrijpen dat dynamische prijzen gebaseerd zijn op echte, logische factoren (d.w.z. vraag en aanbod) in plaats van een willekeurige prijs die niet wordt ondersteund door concrete gegevens.
Zoals het onderzoek van de ZHAW University heeft aangetoond, is dynamische prijsstelling een zeer positieve strategie voor inkomstenbeheer, zowel voor de algehele winstgevendheid van hotels als voor de tevredenheid van gasten. Front Desk Managers moeten daarom het revenue managementteam ondersteunen bij de implementatie van geautomatiseerde dynamische prijsstelling om ervoor te zorgen dat hun property altijd concurrerende tarieven en de beste waarde voor gasten biedt.
Effective forecasting=more effective operational planning
Een ander belangrijk onderdeel van modern revenue management is forecasting, waarbij het revenue management team geavanceerde algoritmes in hun RMS gebruikt om de toekomstige vraag te voorspellen op basis van historische gegevens, huidige boekingstrends, marktanalyse en andere externe factoren zoals lokale evenementen, economische omstandigheden, seizoensgebonden variaties, enz.
While this information is used in establishing the best price for each room, for the right guest, at the right time, it is also a very valuable tool for the Front Desk Manager, as it can help them make better, data-based decisions on important questions such as staffing, housekeeping schedules, hiring, etc. – all of which fall under the Front Desk Manager’s prevue and which will ensure smoother operations, reduce guest wait times and improve service quality. As you can see, effective revenue management leads to optimized operations, directly impacting the guest experience.
Better understanding of guest travel behaviors & needs
Revenue management requires a deep understanding of market segments and guest behavior, and by using this information, the Front Desk Managers can set more accurate expectations for guests and communicate more effectively. Whether it’s explaining the reasoning behind the room rates or setting the right expectations about availability and services, informed communication fosters trust and improves overall guest satisfaction.
Upselling and cross-selling
At the heart of revenue management is the deep analysis of property data, including booking trends, guest preferences and market dynamics. By combining revenue management data with guest data from the PMS and CRM, the Front Desk Manager can identify the opportunities for upselling and cross-selling, enhancing the guest’s stay while maximizing revenue. From upgrading to a suite with a better view to recommending a spa package, these offers should be tailored to the guest’s preferences to ensure that they are received as offers to personalize their stay, rather than sales pitches.
Dat brengt ons bij een belangrijk verwant punt...
Personalized guest experiences
The Front Desk Manager can also use this data to offer personalized experiences to guests; whether it’s automatically booking a returning guest into their preferred room type or leaving a bottle of red wine (their favorite) in the room to thank them for their continued business, this level of personalization goes a long way in making guests feel valued and understood.
The involvement of the Front Desk Manager in the revenue management process can transform the guest experience in many positive ways; at the heart of this transformation is real-time data, provided by the RMS and other operational solutions, making the cooperation of the front desk and revenue management teams very important. From offering guests personalized experiences, offering room rates with better value using dynamic pricing, to improving operational efficiency and enhancing communication, the benefits of the two teams working together are tangible and impactful.
In the dynamic world of hospitality where guest satisfaction is paramount, the Front Desk Manager must embrace revenue management (and revenue management data) to ensure that the property remains profitable over the long-term, while also sustaining the highest level of customer satisfaction for every guest.
As you can see, each of these three roles are integral to the success of a property’s revenue management strategy.
So, I challenge each and every Hotel Manager, owner/operator and Front Desk Manager to make the most important move necessary to set your property up for future success: implement automated pricing technology at your property to support the implementation of data-backed, strategic revenue management at your property, today.
After all, if I could get my 83-year-old father excited about establishing an RMS-backed, automated, data-based pricing strategy at his BnB, why can’t (and why aren’t) you?
There’s absolutely nothing to lose and everything to win!
To discover how RoomPriceGenie can help your property increase your property’s profitability, start your free trial of our automated pricing solution today!
RoomPriceGenie is the easiest way to ensure that your rooms are priced right, every night. Purpose-built for the independent hotelier, RoomPriceGenie is fast to implement, intuitive to use and simple to understand.
In an uncertain world, it’s revenue that you can count on. To find out more about automated pricing, start your free trial today.
