Investing in a revenue management solution (RMS) is a major decision.
It’s the backbone of a successful revenue strategy, which is one that not only ensures that you optimize revenues, but also that you do so profitably – and with an eye on the lifetime value of each guest.
There are a few considerations to make as you evaluate a potential RMS for your hotel and/or casino. As you seek to optimize revenues, drive profits, save time, and outperform competitors, here’s how to find a revenue management solution built to optimize every segment of your transient and group business.
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#1: Automations and Algorithms
When choosing an RMS, it’s important to create a list of desired functionalities. One item that should be included on that list is the algorithms and automations that are part of the system. That said, it’s also smart to carefully consider the efficacy of different algorithms and automations, and how they can affect your business.
#2: System Support
The second most important consideration when investing in an RMS is ongoing support. All too often, hotels end up on the receiving end of a bait-and-switch. That’s when a collaborative and approachable salesperson hands your account to a distant and hard-to-reach implementation specialist.
Successful integrations can make or break an RMS implementation. It’s not just a headache when your RMS doesn’t play well with your existing tech stack it can also be a massive expense.
It also doesn’t do any good to take a rosy view that “we’ll figure it out.” While that may be true, it could be costly! There may be unexpected custom integration fees or other hiccups that disrupt your day-to-day operations. And that gets you away from your goal: a revenue strategy that uses real-time data and advanced statistical approaches to quickly adapt to changes and achieve better pricing outcomes.
#4: Dynamic Segmentation and Distribution
Another powerful aspect of an RMS is segmentation, a helpful barometer as you test different revenue strategies. This is how you narrow in on the right price for the right segment: your RMS does this all dynamically, continually testing and learning, while taking the latest real-time signals into account.
Your most loyal guests are a valuable segment that your RMS can help you target more effectively. An RMS that’s integrated into your property’s tech stack can help you personalize your offers and deliver the right message to your most valuable guests.
#5: Analytics and Reporting
Analytics and reporting help you not only know what’s happening but why. Your RMS should help you answer business-critical questions. For instance: Are you distributing the right rates to the right channel and/or segment? Which one not only delivers bookings but delivers profitable bookings from your ideal customers? Your RMS analytics, coupled with your channel manager, PMS and/or customer data platform, will shape all of your revenue management decisions, from pricing and segmentation to distribution.
#6: Groups, Ancillaries and Upsells
Long gone are the days where room revenue was the thing that mattered most. Today, it’s all about total revenue, including room revenue as well as finding creative ways to generate non-room revenue. Your RMS should be your ally in this pivot to total revenue management. Look for a platform that can help you best manage your ancillaries and
upsells, with personalized offers priced well and offered to the ideal segment at the right time.
Use your RMS data to better understand the rates that are needed for your property to be profitable. Based on your findings, you can then automate upsells and personalize offers based on the guest’s segment, as well as impact the timing and channel of the message.