Revenue Management
Ravneet Bhandari
  • Revenue Management
  • Outside-In Vs Inside-Out Hotel Demand Forecasting
  • Rate optimization is arguably the most critical component of a successful Revenue Management strategy, but most hoteliers still tend to fall into two broad categories when it comes to this discipline: Set-it-and-forget-it, or follow-the-market. Both of these approaches are sub-optimal as they simply ignore the evolving purchasing patterns of increasingly savvy customers. We live in an era of disintermediated distribution, and the reality is that meta search and third party aggregators have made it easier than ever for customers to shop and compare options. Read on...

Matt Lindsay
  • Revenue Management
  • The Value of Customer-Lifetime Value in the Hospitality Industry
  • As simple as it sounds, knowing which customers are profitable is a challenging task for many businesses. Predicting which customers have the most profit potential is even more challenging since it requires estimation of future business. Applying these same modeling techniques and profit calculations to potential customers adds yet another degree of difficulty. Customer lifetime value (CLV) is a (relatively) old concept. Businesses have been calculating the expected operating margins received from a customer from long before the birth of the internet and modern data tools. Read on...

Tammy Farley
  • Revenue Management
  • The Future of Revenue Management in the Age of Airbnb
  • The rise of Airbnb and other peer-to-peer hotel alternatives has shaken up the hospitality industry. While the long-term impact remains to be seen, this new breed of short-term rental providers is proving to be agile competition to traditional hotels, with inventory and pricing adjusting quickly to fluctuations in demand. How can a hotel’s revenue management team effectively respond? Do they treat local Airbnb inventory as a competitor in their market? Shop Airbnb pricing as they do their traditional hotel competitors? This article explores the issues revenue managers must address as they navigate this latest threat to revenue growth. Read on...

Ravneet Bhandari
  • Revenue Management
  • The Impact of Machine Learning and Personalization on Your Revenue Management Strategy
  • The hotel business is in the midst of a peer-to-peer revolution, and it’s seriously threatening the industry’s financial stability. A new wave of accommodations spurred by the birth of the sharing economy is radically altering how many people prefer to stay while traveling. According to a survey of US travelers, consumer preference for staying at traditional hotels is halved (79 percent vs. 40 percent) once they’ve experienced peer-to-peer housing. In addition to Airbnb, there’s a rising number of peer-to-peer accommodation sites appealing to specific market segments. Those include the high-end home rental group OneFineStay, and the family friendly HomeAway, which are both nipping at the traditional hotel business. And if hoteliers don’t meaningfully respond, that nip could become a significant bite to the bottom line. Read on...

Marcus  Nicolls
  • Revenue Management
  • Dollars & Sense: Merging Cultures Post-M&A
  • A super platinum-everything status guest with a certain brand hotel chain walked into one of his favorite properties after this brand recently merged with another chain, looked around and said, “It just isn’t the same. I don’t even recognize them anymore.” He then walked out of the door determined to find a new favorite property he could count on. Does this sound far-fetched to you? It shouldn’t; it happens all too often, and it should send chills down every leader’s spine. While this anecdote focuses on the guest, you can imagine the impact this would also have on the employees. Read on...

Paul van Meerendonk
  • Revenue Management
  • Is Your Organizational Structure Maximizing Your Revenue Potential?
  • The evolution of the revenue management industry has been one of 2016’s top trending topics. From the onslaught of big data opportunities to the drastic improvements in the life of the revenue manager, the benefits of revenue management practices and its sophisticated technology have been far-reaching in leaving virtually no revenue stone unturned. However, advanced technology has been accommodating far more in this industry’s evolution than high consumptions of complex data and the bolstering of on-the-job productivity. As the industry continues to propel forward with better insights and more informed strategic opportunities, we’ve also seen a distinctly marked shift in how the role of revenue management is positioned within the organizational make-up of hotel(s) and hotel companies. Read on...

Kelly  McGuire
  • Revenue Management
  • Price, UGC and Loyalty
  • With the growing presence of UGC, consumers have more information than ever before when they are making a hotel room purchase. The question is: how do consumers use all this information, with price, to establish value and ultimately make a purchase decision? Understanding this, particularly across different segments of guests, will help hotels make better pricing and positioning decisions. The unmanaged business traveler represents a large and very valuable segment for hotels. This group of frequent travelers is potentially highly influenced by their loyalty affiliation. Does their loyalty change their reaction to price and UGC? Read on...

Paul van Meerendonk
  • Revenue Management
  • Assessing the Performance of Your Revenue Performance Initiatives
  • While revenue management professionals devote significant investments and efforts towards advancing their hotel’s revenue resources, many hotels still struggle with assessing the actual performance of these revenue management initiatives. Namely, how can hotels ensure they are squeezing all the juice out of the proverbial revenue management orange? The hospitality industry has been using revenue management successfully for decades. However, for many organizations, the greatest revenue management challenge is not necessarily of a technical nature, but often organizational. Confronting hotels today is an essential need to align their people, processes and technologies around achieving maximum revenue performance. Read on...

Boaz Ashbel
  • Revenue Management
  • Miami's Hotel Industry in Growth Mode
  • Miami continues its transformation from beach destination to world class city, giving travelers a much wider range of lodging options. With close to 5,000 additional hotel rooms being delivered by the end of this year, Miami is experiencing a very active and strong hospitality market. This includes the entrance of international hotel brands and new concepts being introduced by the leading hotel groups. While the region’s visitor count continues to reach record-setting numbers, critics have voiced concerns that the market could experience oversupply, which coupled with other threats the hospitality market faces today, could have a negative long-term impact. Read on...

Paul van Meerendonk
  • Revenue Management
  • A Day in the Life of Two Revenue Managers
  • Recent discussions have been swirling around the revenue management industry and its swift evolution over the past few years, moving steadily past merely filling as many rooms as possible to holistically approaching the quest for achieving total revenue performance. However, approaches and technologies have not been the only revenue management components swept up in these influential winds of change. The lives of hotel revenue managers have also experienced drastic changes in not only their job responsibilities, but in their overall work efficiencies, insights and performance. Read on...

Bhanu Chopra
  • Revenue Management
  • How Room Prices and Sleep Quality Are Interrelated
  • The scent of fresh sheets in a tidy hotel room can win any heart! Travelers unanimously agree that a ‘hotel stay’ should be nothing less than a rich and pampering experience; and they further justify the statement by saying that prices are paid immediately, as quoted online. In order to pay the guests due respect, hospitality chains claim that they change or improve their services as and when an insurgency crops up. So, the single biggest truth of the hotel industry is that ‘sleep quality’ drives this segment. Believe it or not, this catch phrase has materialized into a key measure of health and productivity in the global public consciousness. Read on...

Anthony Clervi
  • Revenue Management
  • How Hotels Can Win the Supply Chain Game
  • Managing supply chain and procurement is one of the best ways a hotelier can increase profits and minimize losses, but it’s tough to do it well. A hotel must manage hundreds of SKUs. With so many products to buy, it’s challenging to find the best sources. Hotel procurement is further complicated by fragmented operations. Bring together franchisees, owner-operators, and multiple brands under one umbrella, and it can be impossible to keep up with procurement. Without centralized processes, managers and operators are more likely to make multiple small-scale purchases from numerous suppliers, making it difficult for corporate officers to ensure hotels purchase high-quality items at the best prices. Read on...

S. Lakshmi Narasimhan
  • Revenue Management
  • Banquet Operations Vs Real Estate Space
  • Almost every banquet operation in recent times in its key performance indicators carries out a measurement of revenue and profit per square foot of banquet space. Why is this? Given that highest and best use has become the primary motivation for managing an asset including banquet spaces, the metrics for measuring performance have also shifted dramatically. No more, is it just revenue dollars less cost dollars resulting in a profit. It is now a matter of leveraging every square foot of space and its worth to earn revenues and profits. You could say that the owners and stake holders are now looking at every foot of space for returns. Read on...

Jim Sprigg
  • Revenue Management
  • Using Econometrics to Accurately Measure Share-of-Wallet and Improve Customer Strategy
  • The rise of big data in an increasingly complex digital economy has economists and marketers constantly expanding what we want to know about individuals so that we can better analyze and target them with messages and offers. Yet, despite a rapid expansion in the types of customer data being offered by data vendors, the ability to know a customer’s share-of-wallet remains just as desirable, and elusive, today as ever. Amidst the promises of big data, one company in the travel industry has found that traditional econometrics and store-level data is the most valuable for deriving share-of-wallet to inform customer strategy and investments. Read on...

Paul van Meerendonk
  • Revenue Management
  • The Evolution of Revenue Management and Big Data
  • The hotel sector has never been a stranger to the winds of change. What was once considered leading-edge customer service practices, like offering free internet to guests or express checkout options, are now basic expectations that travelers view as standard services. Just as the hotel industry has evolved, so have the approaches that hotels have taken to attract the right guests at the right prices. The practice of revenue management, and the systems used to make accurate pricing decisions, have become even more precise and sophisticated in recent years. Most recently, these systems have begun incorporating data on competitor pricing activity and the pricing of services outside of guest rooms, like function spaces. Undoubtedly, the biggest change in revenue management today is the influx of large volumes of guest data and its impacts on future pricing decisions and hotel promotion. Read on...

JANUARY: Mobile Technology: A Permanent Sense of Immediacy

Alastair Cush

A growing number of properties are implementing mobile access guest room locking systems and the apps that support them. Many chain standards mandate mobile access and independents are joining the trend. What few operators understand is that mobile access implementation has changed not only every aspect of hotel door locks but also many other areas of hospitality operations. More people are actively involved in the decision making process for hotel locks than before. Mobile access has integrated the lock process with numerous property and chain departments from sales to guest loyalty and brand marketing. The original purpose of improving guest door locks was exclusively loss prevention and security. Read on...

Jim Vandevender

Meeting data and technology have evolved considerably since the days of the bulky ,expensive mail ordered meeting planner guides and hotel catalogues. The ways in which hotels find and book groups is far different than the antiquated methods of not so long ago. As better technology surrounding meetings and events becomes available , hotels appetites for group business seems to also increase at a parallel pace making the need to keep the related technology evolving even more paramount. The companies that provide hotels with this meeting intelligence are continually developing new and more advanced methods of gathering this sought after data to keep up pace with the demand. Read on...

Dave Weinstein

As with so many industries, the smartphone has transformed how organizations interact with their customers. Look at the automotive industry, the airline industry, and of course, the hospitality industry. You start your car’s engine and set the climate control to the desired temperature, buy airline tickets and check-in on your flight and do the same with your hotel room, all from your phone. There is a slew of services that traditionally are offered by hotels via the “book” on the desk. The book is still there, but some hotels allow you to order via the television while others offer integrated tablets. Read on...

Kacey Butcher

Can you imagine your bank choosing not to provide a way to check account status and transactions outside of your monthly paper statement? Can you further imagine a popular franchise restaurant only having paper take-out menus? You would be forced to contemplate what other aspects internally within the organization would make doing business with them complicated and archaic. There you find your own personal underlying immediate expectation of baseline service and operational procedures, where a decision is often made instantly to move onto the next provider. A decision to choose another provider that seemingly knows how to service customers with the utmost up-to-date standards. Read on...

Coming Up In The February Online Hotel Business Review




Feature Focus
Social Media: Interacting with the Hotel Customer
Consider these astonishing numbers: 1.49 billion active monthly Facebook users. 1.1 billion active monthly YouTube users. 320 million active monthly Twitter users and nearly 400 million registered users on LinkedIn. 400 million active monthly Instagram users and 200 million active Google+ users. The power and reach of social media is an awesome force and it has transformed how hotels interact with their customers. In the past year, social media advertising spending increased 33.5% to nearly $24 billion dollars. Social networks are being utilized by hotels to reach more visitors, expand brand awareness, enhance brand reputation and to establish more direct and personal communication with their customers. Savvy hotel operators are adopting a comprehensive social media strategy, and there are several emerging trends to note. Video continues to be a powerful and influential element in social media marketing, with 70% of companies saying that it is their most effective marketing tool. Video generates a 62% higher engagement rate than photographs alone, and with new social sites like Meerkat and Periscope which offer live video streaming, those numbers will only increase. Sponsored content is another growing trend. Though advertorials have been around for decades, hotels are finding new ways to maximize the visibility of their content. Some are placing sponsored content on Facebook, or on influencer blogs. Another trend is the integration of a “Buy Now” button into social media websites. Customers will be able to make purchases without ever having to leave their favorite social sites. This development is a major convenience for customers and should also be an additional revenue source for hotels. The February Hotel Business Review will explore these issues and examine how some hotels are successfully integrating social media into their operations.