Revenue Management
Robert Mandelbaum
  • Revenue Management
  • Shifts in Hotel Revenues Reflect Changes in Development and Guest Preferences
  • Historically, hotel revenue managers, aided by sophisticated computer programs, helped their properties determine the proper balance between the volume of guest rooms rented, with the price charged to rent those rooms. As revenue management has evolved, other factors have been added to the equation. Now, it is not just rooms revenue that is evaluated. Hotels realize that an occupied room has the ability to generate other revenues within the property. Using data from our Trends® in the Hotel Industry survey we are able to analyze historical changes in all revenues earned by U.S. hotels. Read on...

Robert Rauch
  • Revenue Management
  • Revenue Strategies for Boutique Hotels
  • The market is poised for boutique hotels to make an impact on the hotel industry like they never have before. With an expected soft landing of the economy in 2017 (2-3 percent RevPAR growth max) it is more important than ever for independent hotels to ensure that they have proper revenue strategies in place. Competing with the big brands for market share can sound like a herculean struggle but with execution of the proper procedures, a boutique hotel can stand apart from the crowd. Understanding where your business comes from is the first step of proper revenue management. Read on...

Liz Uber
  • Revenue Management
  • How do You Identify a Good Piece of Business?
  • Finding “good” business is not enough, by itself, to ensure the long-term success of a hotel. Instead, you must find good business to bring to your property that is also the “right” business for that particular location. Although this might sound like a fairly simple task, identifying the right business for the right hotel can, in fact, be a complicated endeavor. It involves a thorough evaluation of each opportunity, along with many fluid components at the property, and the market in which it is located. These factors can include the operations of individual departments within a property. Read on...

Ahmed Mahmoud
  • Revenue Management
  • The Most Overlooked Hotel Revenue Stream Measures
  • The ultimate goal of each hotel is to generate more revenue, achieve higher guest satisfaction, and a higher rank vs. its competitors, but when hoteliers implement the revenue management concept it needs a set of tools to help achieve the goals critical to maximizing a hotel’s profitability. It might be “A dark science --combining high technology and black arts”. While revenue management professionals devote significant effort towards advancing strategies and tactics to optimize revenue, many revenue managers still lag when it comes to establishing and measuring agreed upon success criteria. Read on...

Paul van Meerendonk
  • Revenue Management
  • Revenue Management Health Check: How Does Your Hotel Measure Up?
  • It is commonly accepted today that revenue management is critical to the successful operation of any hotel. However, while the adoption of this strategic approach to pricing - and the advanced systems that support this - are becoming more widespread, there is still no industry standard for how to evaluate revenue management outcomes. This lack of universal criteria around how to assess revenue management can pose challenges in trying to sell the success of a program within a hotel, as well challenging how to accurately benchmark a hotel’s revenue performance against its competitors. Read on...

Daniel Wise
  • Revenue Management
  • Bringing Revenue Management Tools to the Masses
  • Hotel revenue and profit optimization solutions have come a long way since my time as a revenue manager at Best Western several years ago. During those days, I discussed frequently with my co-workers how, while there were clearly benefits to implementing an automated revenue management platform, the technology solutions available at the time were not ideal for the mid-market sector of the industry, let alone independent hoteliers without the power of a flag behind them. Read on...

S. Lakshmi Narasimhan
  • Revenue Management
  • The Buffet A La Carte Balance in Hotel Restaurants
  • As someone who has poured money into a restaurant as an investment vehicle, the owner is looking at a good return on that investment. Restaurant profits cannot match rooms accommodation profits and in most cases tend to be between one third to one half of rooms profits. It is thus critical that the restaurant product is well thought out and harnesses resident hotel guest patronage complemented by non-residents. A well balanced buffet and a la carte offerings in the hotel restaurant will go a long way in delivering that patronage factor as well as producing that return on investment the owner is seeking. A win win situation that owners and stake holders hold dear to their hearts. Read on...

Charles B. Rosenberg
  • Revenue Management
  • A "BIT" About Cuba - Using Bilateral Investment Treaties to Protect International Investments
  • In July 2016, Starwood Hotels & Resorts opened a new hotel in Havana, Cuba. Once unimaginable for a U.S. hotel company, the Four Points Havana offers more than its 186 guest rooms and modern spa; it provides an authentic Cuban experience where guests can enjoy traditional Cuban cuisine in the Don Quixote restaurant, sip on the island’s most popular beers, Cristal and Bucanero, in Starwood’s signature bar “Best Brews,” and experience Cuba’s most sought after cigars with the guidance of a cigar sommelier in the hotel’s 5th Avenue Cigar Bar. As the first U.S. hotel in Cuba in nearly sixty years, the Four Points Havana signals the beginning of a new era, as previous forays into the hotel industry in Cuba did not end auspiciously for U.S. investors. Read on...

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...

AUGUST: Food & Beverage: Multiplicity and Diversity are Key

Larry Steinberg

The foodservice industry is one of the oldest and most important. Consumers from all demographics rely on it virtually every day for sustenance. In fact, in the U.S. alone, it’s a nearly $800 billion industry that’s extremely competitive, with hundreds of new establishments popping up every year, and much of this new business is the result of increased consumer demand. Consumers want more options. For every practiced chef, there is a collective of guests eager to spend their hard-earned dollars on something exotic and different. They want to experience a bit of culture by way of their next meal, and they want to find it using the latest technology. Read on...

Frank Sanchez

About two years ago, I started my career at the Chicago Marriott Downtown Magnificent Mile. I came from San Diego, California, the apparent capital of farmer’s markets. When I moved to Chicago in late-October, the number of farmer’s markets had already begun to taper off and all that was left of the hotel’s rooftop garden was the sad remnants of a summer full of bounty. However, I was in for a pleasant surprise. The Chicago Marriott Downtown operates a year-round experience to create food from scratch that gives customers fresh and nutritional options. I was thrilled to join a team that can tell a customer that the very greens on their plate were grown just floors above them. Read on...

Thomas  McKeown

To serve today’s eclectic, socially engaged and sophisticated guests, hotels and chefs need to get creative, change their thinking and push back some walls – sometimes literally. The fun thing about meetings hotels is that they are a different place just about every week. One week we’re hosting a bridge tournament, the next a corporate sales team, or a dentists’ conference, or sci-fi fans in costumes, or cheerleaders jumping for joy. You name the group, and our hotel has probably welcomed them. Read on...

Elizabeth  Blau

Over the past several years, many of us have watched with excitement and interest as the fast-casual restaurant segment has continued to boom. More and more, talented chefs with fine dining pedigrees are bringing their skills, creativity, and experience to concepts built around speed, approachability, and volume. Right now, the ability to offer a gourmet experience at all price points is as compelling to restaurateurs and diners alike. Read on...

Coming Up In The September Online Hotel Business Review




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Feature Focus
Hotel Group Meetings: Blue Skies Ahead
After a decade of sacrifice and struggle, it seems that hotels and meeting planners have every reason to be optimistic about the group meeting business going forward. By every industry benchmark and measure, 2017 is shaping up to be a record year, which means more meetings in more locations for more attendees. And though no one in the industry is complaining about this rosy outlook, the strong demand is increasing competition among meeting planners across the board – for the most desirable locations, for the best hotels, for the most creative experiences, for the most talented chefs, and for the best technology available. Because of this robust demand, hotels are in the driver’s seat and they are flexing their collective muscles. Even though over 100,000 new rooms were added last year, hotel rates are expected to rise by a minimum of 4.0%, and they are also charging fees on amenities that were often gratis in the past. In addition, hotels are offering shorter lead times on booking commitments, forcing planners to sign contracts earlier than in past years. Planners are having to work more quickly and to commit farther in advance to secure key properties. Planners are also having to meet increased attendee expectations. They no longer are content with a trade show and a few dinners; they want an experience. Planners need to find ways to create a meaningful experience to ensure that attendees walk away with an impactful memory. This kind of experiential learning can generate a deeper emotional connection, which can ultimately result in increased brand recognition, client retention, and incremental sales. The September Hotel Business Review will examine issues relevant to group business and will report on what some hotels are doing to promote this sector of their operations.