The hospitality industry is predicted to face several significant challenges in 2023.
NB: This is an article from Oaky
Inflation and recession are on everyone’s minds forcing consumers to work smarter with their money. Those that do decide to travel will most likely book at a lower-category hotel. Trips will also be shorter.
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The good news for hotels is that while their operational costs are anticipated to be more in the new year, according to an article shared by Forbes, hotel prices are also expected to increase around the world. Depending on where your hotel is situated, it can increase by as much as 30%. Though, this is an extreme prediction. On average, it looks like hotel rooms are set to become between 7% and 10% more expensive.
Hotels in the Asia Pacific region will see the lowest hotel price increases. The Amex GBT report anticipates that it will average anything from about 1.2% to just over 4%.
Considering these challenges, implementing smart hotel revenue management strategies becomes even more critical in the new year. All in all, it can make a big difference in the profitability of your hotel business.
5 key pointers to optimise your hotel revenue management strategy for profitability:
1. Ensure a wide reach and improve the brand exposure
Being listed on the main OTAs that attract significant website traffic is key. That said, it shouldn’t replace the hotel website. Moving forward, it will still be important for hotels to optimise their websites for search engines. This includes double-checking that the user experience is seamless. In other words, potential guests should be able to find the information that they need easily and quickly.
This is the foundation for a greater number of direct bookings:
Optimised website + good UX -> More traffic and increased brand awareness -> More direct bookings
2. Let data guide your pricing decisions
The best upselling and customer value decisions are made from the inventory directly. Linking customer marketing and optimisation to revenue management can make a number of direct contributions. Not only will this help you to offer more relevant offers, but it can also boost your conversion rate and attract more returning guests.
In order to best manage this process, hoteliers need to stay up to speed with booking trends. This way, they can link personalised offers to customer profiles directly.
In 2023, hoteliers will also need to harness every revenue opportunity. Start by ensuring that your historical data is clean and correct. Then, you must know how to use it to identify revenue opportunities. Once you have these systems in place, it’s basically rinse and repeat, and you’ll be able to maximise revenue opportunities repeatedly.
Not only will data collection help you to guide your dynamic pricing strategies, but it also empowers hotel staff to improve the overall trip of guests by offering better personalisation and in-stay guest experiences. Business or leisure travellers, families or solo explorers, hotels know which market segments they want to attract because they’ve tracked it. Now, it’s just a matter of creating targeted adverts and leveraging upselling to these different market segments everywhere they go.
When we think about data collection, we’re no longer talking about a database of records that we use simply for email campaigns. Instead, we’re talking about engagement. How can we use the historical data that we have to drive ancillary revenue?
To sum up, all the hotel departments need to understand their customer profiles and behaviour. This way, they can identify and implement suitable strategies to drive revenue. By combining data with market-leading analytics, you have a data approach that can drive revenue.
