2017 is no time for hotels to merely ‘manage’; around the industry, signs in the latest available research and comments heard at the Americas Lodging Investment Summit seem to indicate that this year could be one of slow growth for revenue per available room.
Any modest rise in RevPAR is expected to be driven mostly by higher average daily rates; STR projects total occupancy to decrease slightly this year.
With a premium placed on holding rate and yielding prices higher on those harder-to-come-by compression nights, hotels can’t get by with just passive revenue management. This year, they will need to movd toward Revenue Strategy that incorporates not only dynamic pricing, but also greater knowledge of distribution, digital marketing and new loyalty strategies.
Getting started down the path toward a more holistic hotel Revenue Strategy isn’t easy. But some experts, like Greg Allen and Gabriela Guevara of Duetto’s Managed Services team, lent their insights into which first steps make sense for revenue managers at hotels of any size.
“DORMs forget that they can be creative,” Guevara said. “It’s almost like an art. Strategy is white canvas, and you don’t want to be in the management of just coloring within the lines.”
Learn new strategies constantly
For properties to be more strategic in how they not only price rooms but also manage marketing, operations and profitability, the revenue management leaders must embrace a culture of self-education.
Allen and Guevara agreed that a DoRM needs to learn the inner workings of other departments, and she must stay on top of new trends and strategies affecting those departments.
“That’s transitioning for revenue managers, from just pricing and seasonality to studying digital marketing, Google Analytics and Google Adwords,” Allen said. “What are the appropriate words you could spend money on to drive people to your brand.com and drive direct business?”
Guevara said finance is another important discipline for revenue managers to learn, as well as marketing.