We’re out of the rut. Now what?
— 11 experts shared their view
By the end of 2019, many of the thought leaders in revenue management had begun echoing a common theme, basically that the Revenue Management discipline was stuck in a rut. Industry-wide, Total Hotel Revenue Management was starting the become a joke. There was the longstanding complaint about the OTAs, but little being done about it. And the more recent debate about whether AI was on track to replace the Revenue Manager, despite only 15% of all hotels globally even having a revenue management system. Some openly warned that without evolving, the discipline risked losing relevance, and the influence and opportunities that go along it.
Then COVID-19 came out of nowhere to occupy the top of everyone's mind… overnight. Short term crisis management became the only job requirement. But these concerns did not go away, and if anything, the opportunity (and responsibility) that organizations possess to challenge every existing norm as they rebuild has only shortened the timeline.
The question to the Revenue Management community is: As we move out of the crisis management phase and towards the "next normal", how have your organization and responsibilities changed? What tools, technology, and processes have earned a permanent place in your routine going forward?
CRME, CHIA, Chief Commercial Officer at Remington Hotels
It is amazing to think about how much our industry has changed its focus in such a short period of time. Over the past few months at Crescent Hotels & Resorts we have shifted our focus on 3 main areas in order to support our associates and improve performance for our owners.
Analyze new bookings and leads: Our booking window has become much shorter on both transient and group. Over 60% of our transient bookings are now made inside the 3-day window. For group, we are seeing a lot of activity inside 30 days, that means we have less time to react and ensure we win the bid for new groups. Whether it is brand tools, property management systems, or crystal reporting, we analyze and compare all new trends in order to formulate a new strategy.
Monitor Pricing & Channels: Our segmentation has also shifted from group and business transient dominant, to retail, OTA, and leisure discounts. We have become more nimble in order to improve our speed to market strategies driven by analytical insights. To that, we have relied even more heavily on competitive pricing tools such as Rate360, OTA Insights, etc as we need to continuously monitor changes in our market pricing and positioning. Currently, there is an abundance of available supply, pricing is not as important as visibility. It does not matter if you are the lowest hotel on the market, if you are on page 7 of a market for a specific OTA, you will not get bookings. Not only we compete on pricing, but also just as important is the product we are offering. (pre-paid, mobile offer, package inclusions) we need to stay on top of it in order to boost our sort order and be exposed to more potential customers.
Share Best Practices: most of our associates have not experienced such volatility in our business. Our goal as leaders is to guide them through this difficult time. In doing so, we are relying more than ever on industry data and organizations, such as STR, Kalibri Labs, CBRE & HSMAI. We spend a lot of time attending webinars to listen and learn about new trends, emerging technologies, and anything we can apply back into our properties. We have increased the number of touchpoints with the field and continuously share best practices and new findings. We need to have strategic minds, read the tea leaves, generate strategies, and get some first mover's advantage.