It’s hard to deny just how much the demand landscape has shifted over the past few years. There was a time not too long ago when historic booking data, a few trusty spreadsheets and gut instinct (cue calculator and crystal ball) were the best friends of every revenue manager. And for the most part, they worked.
NB: This is an article from Right Revenue, one of our Expert Partners
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Let’s be honest, COVID turned the industry upside down. That was followed by the unexpected staycation boom, which offered many of us some much-needed breathing space. But now, that bubble has well and truly burst, and we’re back in the thick of it trying to make sense of a market that’s harder than ever to predict.
Rising living costs, changing booking behaviour, and a global economic outlook that’s about as predictable as next week’s winning lottery numbers are all adding complexity to the role of the revenue manager.
And added to that, guest behaviour has evolved too. Guests expect more – more flexibility, more value, more personalisation. They are booking later and thinking harder before hitting that ‘confirm’ button.
Guesswork isn’t a strategy!
All of this means that without the right tools, forecasting demand has become less science and more guesswork. And even hotels using RMS tools are still relying on static, historical data and in a world that moves in real time, that’s like trying to solve today’s crossword with yesterday’s clues.
From our daily conversations with hoteliers, three key challenges keep coming up:
1. Economic Volatility
The pressure is coming from all sides. Interest rates continue to rise…domestic travellers are responding to inflation and tightening their budgets…energy costs rising… the list goes on. Add to that new legislation, both in the UK and abroad that’s reshaping how, when, and where people travel. All of it is resulting in lower consumer confidence and a much more cautious, considered approach to travel spending.
2. Guest Behaviour Is Evolving
Gone are the days of reliable lead times and predictable patterns. Guests are booking later, stays are of a shorter duration and scrutinising every penny they spend. Booking windows are shrinking, demand signals are coming in late – sometimes very late – leaving revenue teams scrambling to respond. And when that happens, it’s not just stressful, it can also be costly.
