How can you use revenue management strategies to get ahead in today’s increasingly competitive landscape? By keeping a close eye on the local competition.
Among other things, your hotel should be monitoring the room rate of your competitors so you can see just how competitive your pricing is and react in a timely manner when needed.
Here are a few examples of what you can do with the information at hand:
- Value-match competitors
One of the ways you can use competitor pricing to increase your hotel’s revenue is by matching them on price.
Set one room rate at the same price point as competitors, and set another room at a slightly higher room rate. This allows you to attract deal seekers without sacrificing the opportunity to make a slightly bigger profit.
Keep in mind that value-for-money is the key point here – value-matching goes beyond bringing your hotel in line with your competitors’ rates or simply making your hotel rooms cheaper.
- Run effective promotions
Continuing with the idea of value-for-money, promotions are one of the best ways to keep up with, and stay ahead of, your competition.
When you notice your competitors are doing it – probably in the lead up to an event in your local area – find out what their rates are, and then set your rates at the lowest price possible to draw a crowd. This is your opportunity to be proactive and truly get ahead of the pack. Look at the details of the room offers. Do they include breakfast? How many nights is the special rate on offer? Are there any spa or restaurant incentives factored in? Think about how your hotel can give guests that little bit extra.
A word of caution, though: you should only do this in short promotional bursts so your hotel isn’t perceived as low-quality or constantly discounting
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