In Part 1 of our blog series, we talked about how you can set hotel rates to maximise revenue. But this is not a set-and-forget activity. Monitoring market rates in real-time is crucial for hoteliers to ensure that you’re staying up-to-date in a dynamic market.
With such data, you can benchmark and adjust your rates with confidence. Without it, your pricing decisions are based on guesswork.
So how can you do this effectively? To answer this question, we’ve distilled some of the key points from our recently published eBook, How to price right: a guide to setting profitable B2C hotel rates, into a short blog post.
1. Forecast and flex rates in real-time
Remember that you need to strike a balance between selling some rooms in advance at lower rates, thereby guaranteeing occupancy – but holding some back to sell at a later date after raising the price as demand increases (knowing that you risk having those rooms unsold).
Some best practice tips:
- Compare current rates to your OTB (on-the-books) and pickup rates.
- Look at market rates on a daily basis.
- Look at market rates in depth on a weekly basis.
- Consider local events.
- Look at your online booking channels and determine which ones are most effective.
- Remove rates that don’t sell.
2. Look at competitor rates
Real-time competitor rates should always be taken into consideration when reviewing and adjusting your pricing strategy – not only will it help you proactively increase your revenue, but you’ll be able to see which OTAs, wholesalers or meta-sites are undercutting you, and act promptly to ensure rate parity.
But don’t be consumed by competitor comparison. Consider Game Theory and the Prisoner’s Dilemma – if hotels get into price wars with each other, then collectively you put yourselves all at a disadvantage.
Other factors to consider include:
