While dedicating the last decade to examining, understanding and refining how revenue managers plan and execute their pricing strategy, the industry can learn some great strategies that are sure to assist revenue managers in achieving their desired results. Follow these simple rules and you too can transform your revenue results.
Tip #1: Create a long term strategy
A thoughtful strategy establishing short- and long-term goals will help your revenue management team avoid becoming trapped in day-to-day pricing decisions. That myopic, short term view hinders your ability to clearly see a pathway to making smarter decisions. In the moment it may seem like the right approach, but it’s really a disservice to your hotel’s overall pricing health.
You can break that cycle and focus on a longer, more strategic approach. Follow these rules and find success:
- Determine your property’s long-and short-term goals for the coming year.
- Set up and stick to metrics to ensure you’re meeting goals. It’s important to establish a set of evaluation metrics; meaning, create a schedule to regularly evaluate your strategy. Do this and you’ll notice potential problems or opportunities much earlier and then have opportunity to respond proactively to protect rate integrity or raise
- Evaluate high-level activities necessary to accomplish set goals. Perhaps that means expanding distribution channels in certain geographical regions to boost bookings in under-represented, but strong feeder markets.
- Develop tactical elements. Using the distribution example above, a tactical element could be selecting regional OTAs to help accomplish revenue, rate or occupancy goals.
- Organizational silos deter productivity. The revenue management department, sales, marketing, distribution and operations teams all need to be able to work in concert – speaking with one voice. Determine which departments/employees must handle each tactic, and set a timeline/deadline for executing each tactical element. Then share the completed strategy document with each person in all of the departments. And keep it up-to-date.
Tip #2: Focus on social as a distribution channel
Social media cannot be underestimated. It’s no longer a place for simply expressing opinion – it’s a distribution channel waiting for you to leverage it. Consumers, especially younger ones, adapt to new technology more quickly and use social media for all aspects of their travel booking experience. From research through final booking, this is a great audience to get connect with social.