Hoteliers Urged To Prioritize Profits in Distribution Strategy
Companies Must Offer Profit-Based Employee Incentives
It’s never been more important for hoteliers to be on top of their overall distribution strategy and mindful of rates on the various channels they sell on, experts at the 2022 HSMAI Revenue Optimization Conference said.
It’s never been more important for hoteliers to be on top of their overall distribution strategy and mindful of rates on the various channels they sell on, experts at the 2022 HSMAI Revenue Optimization Conference said.
Speaking during the “Distribution Strategies that Optimize Profit and Accelerate Recovery” panel, Andrew Rubinacci, executive vice president of commercial and revenue strategy for Aimbridge Hospitality, said discount channels no longer make sense because travelers will find those discounts regardless of what channel they appear on.
“The overarching theme is you can have the best marketing in the world, you can have the best brand, you can have the best of everything, but if it’s $30 cheaper somewhere, consumers are going to book it,” he said.
He recalled a conversation he had with a sales executive who believed their corporate negotiated business was down 5% at one point, only to discover that it was actually up 5% but those corporate travelers were instead booking at lower cost channels.
“You really have to understand what’s happening,” Rubinacci said.
He said a distribution strategy needs to come down to not just achieving the best possible rate, but how to get the most profit from each channel and defining key metrics to track success.
If that metric is simply achieving the highest revenue per available room in a market, he said hotels could just “do a deal with Booking.com at 90% commission and tell them they have to fill every room every night.”