9 Tips for Revenue Management in 2019
When you run a property, there’s a lot to keep on top of. Sometimes it can be hard to know where to start when it comes to revenue management and the business side of things.
NB: This is an article from BookingSuite
To help point you in the right direction, we’ve rounded up our 9 top tips for running your hotel business in the coming year.
1. Get your website sorted
Let’s face it – the internet is here to stay. And in the hospitality industry, not having a website is like closing your store at peak shopping time. A website is key to your online presence, as it helps guests discover and book your property. While selling on OTAs like Booking.com can be very useful, it’s no replacement for having a good website, since a lot of guests browse on OTAs first, and book direct afterwards.
Once you have a website, it’s a question of making it as user-friendly as possible. To get people to find it in the first place, it’s important to have solid SEO. To make sure people engage with it, you need content that’s informative and inspiring – and it needs to adapt to mobile screens. And to get those bookings coming in, it needs to have a booking engine embedded in it.
2. Get the right mix
Direct bookings are ideal for hoteliers. When guests can book through your own website, you pay less commission, and you have more control over the entire guest experience from beginning to end.
However, unless you’re extremely lucky or skilful at online marketing, the reality is that you won’t be able to rely on direct bookings alone. This is where OTAs can help you boost occupancy – and revenue – by reaching a wider audience.
It’s a question of finding the right mix for your property, market and guests.
3. Make your life easier with technology
Ever since our distant ancestors first started using rocks as tools, technology has helped make our lives easier. It’s come a long way since then, but the principle remains the same.
In the hospitality industry, there’s an amazing number of solutions out there – many for problems you may not even realise you have. Some will help increase your bookings, some will help save you operational time and some are designed to wow your guests that little bit more.
Our recommendation is to have a look at what’s out there – you might be surprised at the impact a simple tool can have on your business.
4. Tweak your rates
Pricing is a key part of any business. How much you sell for, when and to whom can end up determining whether you’re making profit or not.
It’s not something you can just make up on the spot, either. It takes analysis and planning to make sure you’re getting the most profit out of every booking.
First of all, you’ve got to plan ahead, as a lot of guests book months in advance. Make sure you’re on top of both low and high-season rates. In low season, think about promotions that’ll help you fill your rooms. And in high season, browse your competitors to see how high you can set your prices without jeopardising occupancy.
Again, there’s plenty of technology out there to help you. Rate management solutions can save you time and improve your accuracy when analysing both competition and demand.
5. Add value with extras
When you manage a property, the bulk of your revenue will come from your rooms – and that’s unlikely to change. But you can really add a lot onto your overall profits by offering extra services and promotions like drinks at the bar, spa services or city tours.
It’s not only about revenue, either. Extras help you to make your guests’ stay that bit more special. The more special your guests’ stay, the higher they’ll rate your property in their reviews – something that can’t be underestimated when it comes to attracting more bookings.
Tailor your offer to the type of guest that tends to stay at your property, and you’ll be on the right track.
6. Identify your guests
Getting to know your customer is one of the cornerstones of good business. When you understand who your guests are and why they’re attracted to your property, you can focus on adapting your service to your guests’ tastes and habits.
Families, millennials and business travellers all look for different things, so working out who your core guests are means you can tailor your offer (including extra services and promotions) to the people who’ll be most likely to spend money at your property.
This means you can offer the right services to the right people, helping you increase both revenue and guest satisfaction.
7. Keep an eye on the competition
Jean-Paul Sartre once said that in football, everything is complicated by the presence of an opponent. Business is much the same – you’re always competing with someone else for your guests’ money.
Because every customer has to pick between your offer and others, it’s important to know what those other businesses are doing. You may decide to take their offer and create a more attractive version, or you may want to focus on a different chunk of the market.
Either way, a lot of your business decisions – rates, strategy and more – should take their cue from what your competitive set are doing in your marketplace.
8. Track your performance
In business, there’s always a lot of data to keep on top of. All of it can be harnessed to improve sales and service, but it can be tricky to know where to start.
Tracking numbers like your RevPAR (revenue per available room) is a key part of running your business. Without it, you have no way of knowing if your strategies are paying off.
If you sell on OTAs, a lot of this data will be available to you in easy, digestible format. Have a look and start developing a sense of your key numbers.
9. Keep up to date with industry trends
The hospitality industry doesn’t stand still. While the basics of people staying in beds is unlikely to change any time soon, the rest is constantly evolving.
That’s why it pays to keep up-to-date with what’s going on in the industry. With that knowledge, you can tap into lucrative trends and adopt time-saving tools – and you might get inspired to improve your business in ways you hadn’t thought of before.