An asset manager, marketer and revenue management practitioner walk into a bar (6 feet apart, of course). While this may sound like the beginning of a joke, what we are all facing in the hospitality industry at the moment is not a laughing matter. It is important to recognize that taking a thoughtful approach to revenue strategies now will pay dividends in the future.
To help with that, International Society of Hospitality Consultants members Kate Burda, founder of Kate Burda & Co., a revenue management and marketing company; Kristie Dickinson, EVP of CHMWarnick, a hotel asset management and owner advisory services company; and Trevor Stuart-Hill, founder/president of Revenue Matters, a revenue management consulting company, shared their perspectives on some tough questions that hospitality professionals, sales leaders and revenue strategists likely are facing at the moment. Below are the highlights from that exchange.
Faced with single-digit occupancy and many hotels electing to suspend operations while there is virtually no revenue, what should we be doing right now from a revenue strategy perspective
Burda: During this lull period, and as we think about how to approach recovery strategically, the name of the game is to create demand in order to emerge in a highly competitive position. Now is when sales and marketing teams can be having meaningful conversations with customers so that they can be there with them at what we refer to as the “point of inspiration” versus. “point of sale.” The same thinking applies to other segments and travelers.
Dickinson: Interestingly, some hotels have emerged as a critical part of current relief efforts, and in doing so are capitalizing on opportunities in an otherwise halted travel environment. We’re seeing this at some of our hotels that remain open and in a position to accommodate the medical community, including first responders, [the Federal Emergency Management Agency] and related agencies providing aid. Brands have also jumped on the bandwagon, offering special discounts and packages tailored to medical personnel, so there is some demand that needs a home, albeit limited. In terms of what revenue managers can do now to set the property up for future success, first recognize that using history as a guidepost is out the window, including pace, pricing and segmentation. The recovery ramp-up could very well begin during what has historically been a shoulder period, so pricing and segmentation strategies need to be completely revisited to optimize ramp-up. We need to be strategic and ready to capitalize on demand and pricing opportunities as they unfold.
Stuart-Hill: Although now politically charged, the saying “never let a good crisis go to waste” does have some merit in this context. Now is an excellent time for revenue strategists to clean up rate plans, rethink distribution strategies, analyze channel costs (and profit contribution), update merchandizing and think through what rate plans will have most action following the crisis. There is also a lot of valuable data contained in systems other than the [property-management system]. My advice is to take advantage of this time to dig in and discover opportunities and trends that can help you as you emerge from this crisis.
