Whether you’re looking at replacing your legacy tech systems or considering swapping your Excel spreadsheet for a revenue management system (RMS), there’s a lot to think about when choosing the right solution for your business – particularly with tight IT budgets and, in many cases, fewer resources that need to handle more budgeting, forecasting and pricing work.
NB: This is an article from Duetto
Whether we are on your “hot” list or not, you might want to consider these five features as you examine the available options in today’s RMS market.
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1. Intelligent, Scalable Automation
A key benefit of opting for a modern RMS is that it can help scale limited Revenue Management resources by automating manual processes. For example, turning “on” automated pricing can help a few resources to capably handle pricing for a large group of properties. It also helps even a single hotel be more efficient. For hoteliers new to automated RMS, there’s a catch – can you really trust the automation to price intelligently, particularly given today’s unstable market conditions?
You could be filling rooms but not maximizing profits, or leaving money on the table when guests choose OTAs over direct bookings. That’s not desirable, even when resources are strained.
Automation should not be an ‘on’ or ‘off’ decision. Consider an RMS that offers controlled automation, which gives you the ability to react to ever changing conditions without needing to sit in front of your computer all day. With controlled automation, you can decide what is automated, what is not, and what you want to manage with a mix of the two. For example, Duetto AutoPilot Schedule enables users to specify which segments, room types, or days/seasons to run automatically. Getting even more granular, you can set AutoPilot Schedule to jump in only once your property has reached a certain occupancy level, to run up until a number of days before arrival, only publish rates when below an occupancy threshold or on certain days of the week, and numerous other options.
Duetto AutoPilot also safeguards automation by providing user-generated restriction levels, so you can be assured that automation doesn’t create additional risks and the pricing algorithms can intelligently (and autonomously) run and respond to changes in your business.
2. Instant Innovation
The market is constantly changing and technological innovations in distribution, marketing and personalization mean that you need a revenue system that is constantly in tune with this.
Duetto’s cloud-based RMS doesn’t offer “versions” of its releases – you’re always on the latest version, which means you don’t need to wait for IT to deploy new releases (or management to approve them). This was incredibly helpful to Duetto customers during COVID, when numerous tweaks to the algorithm and functionality were critical to open (or partially open) properties finding profitable opportunities where none might have existed otherwise.
Duetto also has little to no downtime, particularly when the Duetto Optimizer is running. Users can also manually trigger the Optimizer with a single click, which is helpful when you need to optimize beyond scheduled times. A lot can change between optimizations, and you (and your rates) need to be ready!
3. Comprehensive and Configurable Data Set
PMS and CRS data has long proved valuable to revenue strategists. But if there’s one thing the last year has taught us it is that hotels can no longer rely on same time last year (STLY) metrics.
If you want to move forward you need to look forward, and not focus solely on the rear-view mirror. You need an RMS that also ingests other integrated data sources in order to objectively assess demand.
Web traffic data is vital for assessing potential demand. Pulled from a hotel’s website booking engine, website data includes bookings, regrets, and denials on brand.com.
Regrets are when someone visits a website, checks out rates and decides not to book.
Denials are when a customer comes to a website, checks availability and doesn’t find the availability because there is a restriction in place (room type not available, hotel is closed, or hotel is full, for example).
Forward-looking website data such as this can help you gauge consumer appetite and price sensitivity.
Also, Duetto offers users the option to run a short-term forecast, putting more weight on short-term pick-up rather than STLY comparisons. This enables revenue teams to quickly respond to changes in demand.
One final important note about data sets: While there is a tendency to over-commit to desiring to ingest any and all data sources into pricing algorithms, doing so also creates a risk of not knowing, when you’re suddenly not meeting your objectives, which data source(s) could be the problem – or if there are other causative factors. Duetto helps our customers find this balance as we regularly update our algorithms with data sets that are proven to help predict demand, while enabling revenue teams to strategically connect to other data sets of their choosing – providing a level of transparency that helps teams decide what makes the most sense at any given time. For example, competitive data sources are often tempting to over-use, even for highly experienced revenue teams, because they perceive to help ensure you don’t go too far over or under what the going rates are. The flip side is that often your competitors are following similar signals, and nobody is actually seizing on true demand patterns – you’re all leaving money at the table. With Duetto, you can make informed pricing decisions driven by competitive pace data versus competitive pricing data, for example (e.g., Demand360).
4. Enterprise Strategy
There is consensus that enterprise revenue teams need to automate, collaborate and innovate in new ways that intelligent, flexible RMS technology can facilitate. So whether you are looking for a corporate-level solution or want to empower those who now find themselves in cluster roles, your RMS needs to be able to set parameters for you and your extended team to be able to work within.
This may include being able to set min/max bounds on rates, to help you control and safeguard automated pricing optimization.
Or setting pricing rules that your strategies remain consistent while pricing is automatically optimized in line with fluctuating market demand.
Our Enterprise Rate Guidelines feature helps you set scalable strategies and roll them out across regions or entire portfolios in minutes. You can create guidelines by brand, property type, region, or something else that your business defines. For example, one Duetto customer has developed a set of strategies for closed hotels, those that are planning to reopen in the near future, and those for hotels that are already open.
5. Flexible Reporting
Again, the days of benchmarking against STLY are now long behind us. So why are hotels still reporting and making pricing decisions on this metric?
Your new RMS should offer a flexible reporting structure that enables you to define which metrics are most important to track and determine who should be notified. And, as we move away from STLY reporting, you need to be able to define the benchmark period most critical to your business.
Look for a system that enables you to analyze quickly and efficiently week-on-week pick up trends to enable you to adjust your pricing strategy in line with demand.
Reporting should also be dynamic, and able to trigger against certain benchmarks, such as if booking levels fall. Manually reviewing every single aspect of the business on a daily basis is impossible.
There are numerous other features to bear in mind when choosing your RMS.
For example, group management may be of importance to your business. If so, look for a tool that enables you to access group displacement down to the segment level along with rate recommendations by room type and alternate stay date and property options. This should take into account commission costs, ancillary revenue, and CPOR amongst others.
As the world works towards ‘new normal’ and travel demand returns, consider how quick your new system can get you up and running, and therefore start reaping a return on investment. And then it should provide instant updates – both to functionality and algorithms – as well as ensuring users retain the same, or better, level of flexibility and ease of use with the system. More isn’t always better when it comes to RMS platforms. Compare this to waiting for a new release, which is painful and costly from an IT perspective, particularly when your competitors are working with the latest and greatest technology already.
You need a system that will provide value from day one. Competition will be fierce.
Consider the pricing methodology of the RMS you are looking at. Pioneered by Duetto, Open Pricing is now the benchmark for advanced revenue management. It enables you to independently apply demand-based yielding strategy to segments, room types and distribution channels in real-time. A “strategy-first” based on Open Pricing will pay huge dividends – while your competitors are spending time trying to build forecasts and budgets around old data and guesswork, your Open Pricing demand strategy will help define what you forecast, and how you budget. It’s like flipping the coin so you can pivot to a new generation of RMS-powered profits.
