revenue manager assessing impact of pricing recommendations from their rms technology

Accommodation providers – from hotels to serviced apartments – need more than just a tech plug-in to succeed in today’s digital-first landscape. As the distribution landscape becomes increasingly fragmented, and guests’ demands and expectations evolve at pace, operators are turning to representation companies to devise and implement wide-reaching commercial strategies.

NB: This is an article from HotelREZ

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Digitalisation has massively advanced guest and staff expectations, with accommodation providers needing to embrace technology to optimise the guest experience. The pace of technological development is so fast that independent properties risk being left behind. That’s where a joint ‘people and tech’ approach comes into play.

Maintaining focus

It’s easy to be distracted by buzzwords such as AI and machine learning. The benefits of SaaS and Cloud infrastructures are constantly spouted. But hotels often lack both the human and financial resources to make use of new systems, their hands tied by tight budgets and an ongoing struggle to recruit, retain and develop talent.

We’re working in a much more complex world, and to be effective, technology must underpin hospitality’s ambition of service. Ensuring the people:technology relationship is a productive partnership is key; allowing staff and guests to benefit from every platform and system.

Opaque revenue challenges

An influx of properties and differing accommodation types is causing greater competition for market share. Consumer behaviour and booking patterns have massively changed, as have guest expectations. The distribution landscape is hugely complex, with more sales agents – both online and offline – than ever before.

We see the independent hospitality sector typically split in three ways:

  1. a) hotels that don’t invest in people and technology – and are massively losing market share
  2. b) properties with revenue managers and auditors, stuck using spreadsheets without the right level of infrastructure, and
  3. c) hotels that rely purely on their technology provider to automate sales, distribution and revenue management.

In the above three cases, revenue management is opaque. Without the right level of data and expertise, it’s impossible to see a hotel’s revenue leakage and identify where sales opportunities are being missed.

Just because the hotel is connected to the right channels doesn’t magically solve the problem. It’s important to know if those channels are performing to the right level. Do they deliver the right type and right value of business? Are they missing out on key business opportunities?

Technology alone is currently unable to decipher and identify this level of detail, nor deduce a hotel’s full commercial potential and identify where other opportunities lie.

Restrictive technology partnerships

Without a doubt, the right technology partnerships are essential, especially for independent hotels. With so many off-the-shelf products which plug into existing environments – independent hotels can compete on a level playing field with larger branded operators.

This is exactly the point that tech vendors labour.

However, it’s not enough to work with a provider with limited customer service or where you’re one client among the many, working to homogenised revenue plans that tap into market opportunity.

Where hotels struggle to optimise tech, the investment loses its return.

Businesses also need to know what to look for if the tech stops working: some hotels have told us that it can take days or weeks to get a response to issues from their tech suppliers.

As more tech functions are incorporated, more aspects of hotel operations become automated – taking away from human management and engagement which can result in a fragmented or uninspiring guest experience. And, while technology has the ability to bypass expensive service providers, what’s missing in a pure tech relationship is the ability to question how business can be improved.

It’s imperative that technology is customised to fit the character and style of each property, so independent operators can maximise revenue across all touchpoints through a truly hands-on tailored strategic approach and avoid losing out on business opportunities.

Revenue ripe for growth

Even today’s most advanced AI doesn’t have the nuances to understand the dexterity in hospitality, including the emotional drivers that influence bookings. Without focus in the right areas and expertise at hand to build quality in sales distribution (especially in the GDS), not only will ADR be squeezed but occupancy will be hit.

At HotelREZ, we blend industry consultation with technology to build a commercial partnership with our clients, offering wide distribution possibilities supported by applications which harness better direct booking opportunities. As consultants experienced in distribution, sales, revenue and marketing, we put an emphasis on a robust strategy underpinned by tactics that draw on expertise, while utilising data and drawing on the power of systems, automation and AI to maximise output.

It’s important that your strategy continually reviews the value of third party partners, ensuring they accurately represent your brand, deliver the right type of guest at the right price, and can maximise revenue throughout a guest’s lifetime, with the aim to reduce the cost of sale.

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