Do we need a new revenue management toolkit for 2021?
— 18 experts shared their view
It is no longer news that the hotel industry has suffered the worst decline in history. The resulting business failures are starting to make the news and most industry experts agree that it will be several years until the industry returns to anywhere near the health it had in 2019. While the global picture is still very gloomy, we are starting to see isolated upticks in reservations. However, whether it is traveler's slowly adjusting to the "new normal", or just pent up leisure demand, the booking patterns are different than ever before. And just like the periods following previous disruptions, the most aggressive and innovative hotels will gobble up all of this trickle of new travelers, leaving most hotels still staring at the horizon, looking for signs of life. Although there will be few winners and mostly losers during the early stages of the recovery, most hoteliers are still working with the exact same set of tools they had, pre-pandemic, including over half of the industry that uses no dedicated revenue optimization technology whatsoever.
So, we ask our panel experts: 1) For a hotel just getting started implementing a revenue optimization process, what technology and services are most essential, and how should they be selected? or 2) For a hotel with an established revenue optimization culture, what new tools have emerged that could be game-changers?
Non-traditional Revenue Manager & Consultant
With first countries having announced Covid-19 vaccines to launch as early as next week (UK) or next month (Belgium), there is light at the end of the tunnel and we can expect demand to (slowly) return to certain markets. As initial demand in your market will be limited, it is essential to position your hotel to gain a maximum market share. Whether your hotel is just starting with revenue optimization or has long practiced revenue management, now is the time to reevaluate your entire hotel tech stack and make sure it is the best fit for your hotel and your market. Make sure it gives you that competitive edge.
While it should not be necessary to mention this, but a sophisticated PMS is the basis of (almost) everything. A great PMS will allow your hotel to work more productively and solid rate management will help your offers stand out.
Speaking about offers, of course, you need a top-notch booking engine.
Did you know that up to 80 percent of your OTA guests had visited your hotel website at some point? Why did they not book directly but via OTAs instead?
Making sure your booking experience matches that of OTAs, e.g. by residing on your hotel domain instead of some third-party vendor's domain, or a true mobile-first approach (the majority of traffic is mobile, this should be reflected in your bookings!), easy communication via live chat, etc.
A poor booking experience is a major reason why guests chose to book on OTAs instead of directly. And of course, once they visit that OTA site, they will see all your competitors and there goes your market share...
So who are your competitors? While this was a relatively easy question pre-pandemic, how has this evolved and how will it continue to evolve? With corporate and group demand basically gone, how are your compsets going to evolve?
Defining your compset will be something that will not only be a more thorough process, but it will likely evolve dynamically.
Keeping a very close eye on your competitors and your overall market is going to be absolutely crucial. And this is not just simply monitoring their prices. You need a really good understanding of their entire offers, inclusions, length of stay, rate evolution, etc.
Your need a rate shop and business intelligence tool which allows you to do this effectively or even automatically.
Business intelligence is something that most hotels have already not utilized effectively (if at all) pre-pandemic. And while previously a lot of our decisions and strategy were based on historic data, this will now almost entirely shift to forward-looking data.
Data (e.g. from PMS, CRS, booking engine and web analytics, etc.) needs to be consolidated and presented in a way that allows you to make the right decisions efficiently.
There are plenty of additional tools that will benefit your hotel. From CRM to review management and so on.
Finding the right technology is time-consuming and time is running out. There is no one product fits all kind of solution to this question but rather which product works best for a specific hotel with a specific team.
But a first-to-market approach is so important as you will otherwise fall behind your competition.
If you are in the fortunate position to have experienced talent in-house, make sure to provide them with the necessary resources to go through the entire selection process with all the interviews, demos and RFPs. And if you don't have anyone to take care of this for you in-house, consider getting external help.
Make sure you get this market share!
PS: If you and your team are still working with only one screen, make sure to get a second one ASAP. Your productivity will go through the roof!