Finance

First thing hoteliers should do is invest and implement technology NOW! With today's SaaS monthly fees and free trials, even in this time with little cash on hand, implementing new technology is possible and affordable. Focus on automation.

While there are reasons for optimism for sure, now is not the time to let up. Hard work will be required to stay ahead of the curve (or, let's be honest, with continued uncertainty, just on the curve would be great!). Guest behaviour, travel purpose and travel preferences will not be stable.

Due to the pandemic, in 2020 hoteliers slashed their IT and marketing spending by over 50% compared to 2019 (STR, 2021). Due to budget constraints, this year the big question is what can hoteliers do in this environment of weak but growing travel demand and limited resources?

Let's remind everyone what the primary goal of revenue management (RM) is: to ensure that the property sells the right product to the right customer at the right time for the right price on the right channel. Typically revenue management systems (RMS) and revenue managers use historical, comp set pricing and market data and combine this with forward-looking demand signals like pacing to recommend the optimum rates.

The current pandemic will certainly have a long term shift in how we satisfy future demand. While there has been a lot of discussion around how it will evolve, it is still too early to figure out how things will materially change, and as such, technology has not caught up to it.

For individuals new to the concepts of revenue optimization, the first step would be to understand the breadth and depth of what is involved. Hint, it goes far beyond pricing. Work alongside an expert until you are ready to fly solo.

In the pre-COVID-19 era, some revenue managers were indeed stuck in the rut. Who were they? Revenue managers who acted as mere “OTA Relationship Managers.” Or as comp-set pricing strategy plagiarists. Who used an Excel spreadsheet as their only technology tool.

The industry needs to face some important challenges, the first one incorporates more technology in our ecosystem, hotels and chains need to have more information on the daily basic decision, but they need to be more disrupted in this area, for example, smart destination software must come to our technology ecosystem.

Thank you for the viewpoint, Scott. First of all, I'd like to express my opinion that the discipline of Revenue Management will never lose its relevance, no matter what happens in the industry and in the world. A business simply can't be successful without some type of RM tactics in place.