Revenue managers may read all of the latest research and trends and have every good intention of implementing them but never quite get around to it. This is especially true for independent and boutique hotel revenue managers.
It is vitally important to make the transition from gathering and analyzing data to seeing a pattern then acting on it to generate revenue. In an excellent article entitled The Future of Revenue Management is Now, Tammy Farley, Principal at Rainmaker states “Not only must revenue managers be analytical, evaluate market conditions and understand existing demand to make pricing decisions, but they also must be able to interpolate this data in the context of corporate strategy and brand standards in order to determine the best tactical actions to take.” (HotelNewsNow, 12/30/11)
If all of this seems overwhelming, see below the steps that any revenue manger can take to move the ball down the field in 2012. These are simple and straightforward.
Here are 5 manageable resolutions you can do to enhance both your revenue management skills and revenue for the hotel
1- Finish (or start) that 2012 Revenue Management Plan with strategies by month.
While it may change during the year as conditions warrant, it provides that road map going forward. Which channels have produced how much and what can be done to stimulate them in 2012. Which channels have not produced and is there a strategy that can be deployed to improve their performance? Don’t forget to include a front desk reservation sales training program if their conversion ratio warrants it. Yes, maximizing revenue from all sources is the revenue manager’s job.
2- Develop closer relationship with your OTA market managers and solicit their advice.
This is one of the most basic things a revenue manager can do. Ask their advice such as what strategies have worked well for other similar properties in similar situations and market conditions? They know the big picture and while they can’t name names, they can help the revenue manager understand what is working and what isn’
3- Develop and market that mobile app.
This is more critical for boutique and independent hotels as the franchises will take care of the franchisees apps. The research indicates that more and more reservations are coming through this channel and that they are often last minute bookings within 48 hours of arrival. However, it is not sufficient to develop the app and expect your customers to find it – you will need to promote it to them. Measure the results of mobile promotions and make adjustments
4- Be scrupulous about maintaining rate parity and integrity.
The issue of rate parity is obvious if you have ever given a rate to one of the OTAS and didn’t change it on the others quickly enough – your Inbox will fill with emails from all of the other market managers. Ensure that whatever promotion you are running on the OTA mobile apps is the same as on the hotel’s app. Rate integrity means that the customer can understand why you are offering a rate different from a published rate. Is it a weekend rate; is it a rate you going to offer every fifth Friday of any month that has 5 Fridays?
5- Set goals for revenue from all channels and measure, measure, measure.
Each channel on the budget and the reports should have a rooms and revenue objective attached to it. As part of that revenue management plan, you should include the strategies you are going to use to achieve these goals. Once those strategies are deployed, have a mechanism in place to measure the production. If the strategy isn’t producing as you thought it would, adjust the strategy or try a new one. Don’t be afraid to take risks – not all new strategies are going to perform as you thought they would – move on!
There! Those aren’t so tough but they are critical for boutique and independent hotels especially.
Would a revenue management audit help you start the year on the right foot? Does your revenue management team need some training or do you simply need the revenue management and/or online distribution piece done by someone else so you can maximize revenue opportunities? Real simple Revenue Management provides solutions in all of these areas.