Hotels devote large portions of their revenue management strategies around developing and implementing the right pricing structure for their property and market. But establishing the right structure isn’t a one-off activity – and with the hotel’s bottom line depending heavily on revenue generated from the implementation of a proper strategy, it is critical that hoteliers routinely and thoughtfully evaluate their pricing options to determine which approach best fits the needs of their business and technologies.
Today’s advanced technology offers pricing options that suit a variety of unique business needs and markets, and hotels should carefully choose the approach that fits their objectives – rather than limiting their needs to fit a one-size-fits-all option.
However, with different pricing functionalities available, what should hotels consider when selecting a pricing approach to complement their revenue strategy? Here are four considerations to help hoteliers develop the right strategy for their hotel:
Guest Pricing Presentation
How do your guests prefer to buy or how are they accustomed to seeing rate offers? Some guests or markets prefer a single rate offer that applies to every night of their stay – regardless of how long they stay. Others happily accept a different rate for each night. Some markets prefer a total price for the entire stay – avoiding challenges with different rates for different nights of the stay.
Rate Strategy & Business Need
Which strategy does your hotel need to capture optimal revenues based on your business mix? This will depend heavily on the hotel’s business model and average length of stay.