Left Brain, Right Brain: The Hotel Revenue Management Skill Set

A few good hotel revenue management experts are born for this role, but that doesn’t mean they can’t also be made. While the following list of revenue manager traits might seem long and intimidating, keep in mind no one person embodies all these qualities. Also, any skill can be strengthened with proper training. It could be argued that the most important trait of a hotel revenue manager is an ability to work both sides of the brain.

 

Left Brain Skills

  • Economic Guru—An ability to stay updated and understand what’s happening not only in the hospitality industry, but the economy as a whole.
  • Math Wizard—Must be able to translate all that economic data into useable numbers that apply to your hotel.
  • Tech Geek—Should know spreadsheets inside and out, effectively navigate online hotel distribution channels, understand the principles of e-commerce, and choose the right hotel revenue management system for your hotel.

 

Right Brain Skills

  • Chess Master—Be able to re-evaluate the data in front of him or her to plan five moves ahead, and adjust as needed.
  • Great Communicator—Once a strategy is developed, he or she must be able to sell that plan to coworkers, managers, and possible hotel owners. This takes people skills and the ability to stay cool under pressure.
  • Spirit of Adventure—While hotel revenue management requires the ability to analyze and make sense of data—lots of data—it also requires the courage to make decisions based on that data and to sometimes take a leap of faith. And, of course, be able to critically analyze the change in data resulting from that leap.
  • Voracious Reader—A good candidate for the job should have subscriptions to financial, economic, and hospitality industry publications; online blogs; and newsletters.
  • Right Attitude—The drive to keep going onward and upward in terms of definable goals and skill level is necessary.

 

Smart eHotels™ has the right stuff to enhance your hotel revenue management strategy. Contact us today!

Hotel Revenue Management: 5 Tips for Success

Are you an executive for an international hotel corporation? Manager of a ten-facility, regional chain? Or a mom-and-pop operation in a seasonal resort area? Guess what? You all have something in common. You can benefit from a hotel revenue management system.

 

Recognizing that the smaller the business, the further your limited resources have to stretch, a good revenue management system can plump up your bottom line 5 to 10%. Those numbers are hard to ignore. Below are five tips to ensure your system achieves success.

 

Tip #1: One Size Doesn’t Fit All

Despite the common need for a hotel revenue management system, unfortunately, one size doesn’t fit all. There is no generic system that’s plug-and-play for every business. In addition, a hotel that’s hobbling along without a system is one thing; adhering to a system that’s a poor fit for your business model is infinitely worse. A revenue management system needs to be custom fit to each unique hotel, even within a large, multi-facility corporation.

 

Tip #2: Sort the Good Data from the Bad

It’s not hard to compile lots and lots of data. What you really need, though, is an accurate and reliable process for interpreting those numbers. For example, how do you distinguish good data from bad data?

 

The answer is to consider the source. Data collected from other travel-related sources, particularly those governed by strict regulations, can generally be considered accurate. Data that’s gleaned from customers, however, which often passes through two or more sets of data entry (paper or online forms, direct entry from passports, etc.) should be examined with a healthy grain of salt on the side, since there is more room for human error.

 

In addition, data gathered from mobile phone users is, literally, another moving target. You may know the age, location, and historical travel purchase habits of the phone’s owner, but what if that phone is borrowed? The search and purchase data is “polluted” by someone who may not be your target customer.

 

Direct, person-to-person contact between your staff and the customer remains the absolute best way to collect information. It’s critical for a hotel revenue manager to make sure the data pouring in from your front desk is clean and accurate.

 

Tip #3: RM Isn’t a One-Person Operation

Which leads us to our next tip: for a hotel revenue management system to work, and work well, everyone within your organization has to be on board and properly trained to collect and pass along the right data at the right time.

 

Tip #4: Move Beyond Spreadsheet Figures

Thanks to modern hotel revenue systems, the sheer variety of data is more vast than ever. However, financial numbers don’t mean anything if you’re not aware of the larger context. While the data can reveal you had an uptick or downturn in reservations last month, the larger question is “Why?” Is it something you had control over, or was something else occurring that impacted sales? Was it an annual event you can anticipate for next time, or an unexpected incident (a closed freeway, a fire at another hotel, etc.) that sent more customers through your door?

 

Tip #5: Customers Don’t Stand Still—Data Doesn’t Either

As the number and variety of booking channels increase (web site, mobile, social media, and third-party booking engines), an effective revenue management system can help you make sense of the data coming in from those disparate sources. The more real-time the data is, the better.

 

For example, it can be extremely useful to know what kind of device is most commonly used to make a last-minute reservation so you can tailor any marketing efforts to that type of device. In general, a week or more before any given arrival date, about half of all reservations are made on a traditional computer. As the arrival date nears, you’ll notice a shift to mobile devices like tablets and phones.

 

Learn More Today

If you’d like to know more about how a hotel revenue management system can help you, contact Smart eHotels today.

Hotel Revenue Management: Small Changes Add Up

No doubt about it, the Internet has done much to level the marketing playing field between the giant chains and the independents in the hotel industry. But even if we could totally automate our property management system to integrate seamlessly with all our global distribution channels, does that mean we can just “set and forget” our hotel revenue management?

Absolutely not. The human element is still a critical part of ensuring each category of rooms in your inventory is at the right price point to maximize RevPAR, or revenue per available room. It’s crucial to monitor how much each of these online distribution and marketing channels are costing in terms of dollars and hours to ensure you aren’t wasting both on unproductive efforts.

Determining Channel Productivity

Here’s how to break out the data to determine when a channel is productive or not:

  • Track how much time you’re spending maintaining each channel.
  • Track which channel leads to actual bookings, and factor in the length of stay and room types booked. You may find the type of customer you attract through Twitter differs from one who booked due to a Facebook or email newsletter promotion.
  • Compare the ADR, or average daily rate, to the actual revenue each room type produces.

Eying the Competition

Your hotel doesn’t exist in a vacuum. You’ve got competition, plus savvy customers who keep discovering more hotel room deals online. To avoid getting left in their dust, you should be where your competition and your customers are online. This can be a challenge because new web sites, private networks, flash sales via email newsletters, mobile apps, Twitter hashtag deals, and Facebook tools pop up all the time.

Good hotel revenue management means keeping an eye on the competition by subscribing to their email newsletters, tracking their Twitter feeds, and even “liking” their Facebook page so you can know when a promotion occurs that might impact your bookings.

Garbage In, Garbage Out

All kinds of software tools can compile and analyze incoming data from all your distribution channels. It seems logical that the more data you have, the better, right? Not always.

Knowing how to organize the most important data points will keep you from going cross-eyed from trying to make a decision while that data is still fresh and relevant. For example, while it’s helpful to know how many bookings occurred through your Facebook flash deal, it’s even more helpful to know exactly when the majority of those bookings took place. If your target customer isn’t logging on to Facebook until after dinner, chances are that flash deal you posted in the morning will be too far down on the news feed for that customer to see.

Online travel agents, however, may start logging in first thing in the morning, so sending out a carefully timed email special at that time will more likely draw their attention.

Looking Forward—and Sideways—for Hotel Revenue Management

Relying solely on historical data to forecast future demand can sometimes backfire if you aren’t also paying attention to what’s happening in the travel industry as a whole. Let’s say you’ve set your room prices for the next month based on good, solid, historical data. It’s a rate designed to attract more customers during a traditionally low season for your hotel. That’s all well and good, but what happens if a major airline runs a special fare for flights to your region? Suddenly, hotel rooms are a hot commodity, and you’re sold out before you’ve had a chance to adjust room rates to the sudden demand. You’ve lost out on an opportunity by not taking into account current and future data points.

That’s why the key to successful hotel revenue management involves more than automated tools. By understanding the human element and analyzing your data, the competition’s deals, your customers’ preferences, and industry news, these small changes will add up to more bookings and increased revenue. For more information, contact SmarteHotels.com and let us help

What’s New in Hotel Revenue Management Systems—Part 2

Continuing our look at What’s New in Hotel Revenue Management Systems, this time we cover two more stars on the software horizon, both traditional and cloud-based. Whatever your management style, there’s a software package that fits it perfectly. Even when you feel like changing things up a bit, these software systems help you keep from running off track in your quest to maximize your bottom line.

Here are a few hotel revenue management systems creating a buzz right now:

i-Rates
i-Rates is starting a revolution aimed at increasing your hotel’s bottom line. This innovative hotel revenue management system is based on what developers call “reinforcement learning.”

It’s almost like you have an intelligent being learning your hotel facility, your management style, and your customers to make sure every one of your rooms is competitively priced 365 days a year. You can adjust the degree of automation to allow for maximum flexibility, plus you can input your own data, which the system will then take into account for this and future dates. Any room rate changes are automatically transmitted to all hotel global distribution channels.

Duetto

Another hotel revenue management system on the cutting edge, Duetto saves your hotel from the dreaded “room rate slide” that happens all too often when managers figure that simply offering cheaper rooms will draw more customers. Duetto helps protect your brand and your bottom line by keeping your focus squarely where it belongs – your target customers.

Using algorithms based on past history, the software quickly gives an accurate picture of future demand, allowing you to keep your target customers filling rooms during peak-demand periods while attracting new customers with special (but not artificially low) pricing during off-peak periods.

Unlike some other hotel revenue management software programs, it’s cloud-based so there’s nothing to download, upgrades are automatic and free, and the monthly fee you pay is often earned back in the form of a healthier bottom line.

Some of its productivity-enhancing features include block allocation management, event tracking, reporting of competitors’ rates, and web shopping data.

Let Smart eHotels help you choose the best hotel revenue management system for your hotel. Contact us today!

What’s New in Hotel Revenue Management Systems—Part 1

Hotel revenue management (or yield management) is the lifeblood of every hotel, small independent to international chain. It’s also an eternal source of stress for hotel managers, even those who are good at it.

These days, though, you don’t have to spend hours poring over spreadsheets, punching a calculator, or consulting a crystal ball. Modern hotel revenue management software systems have taken out much of the guesswork while retaining the ability to customize for your unique facility.

Here are a few hotel revenue management systems creating a buzz right now:

Frontdesk Anywhere

These days, it’s all about the cloud, and hotel revenue management software developers are aiming for “cloud nine” when it comes to making your job easier and more mobile.

One of Frontdesk Anywhere’s strongest features is its ability to integrate hotel revenue management and hotel global distribution channel management into one seamless application. The software keeps an eye on room availability, and analyzes all available data to assign the up-to-the-minute optimum room rate in a snap. It also covers all the bases: if the room rate changes on one distribution channel, it automatically hits the web to make sure room rates are consistent on all channels.

There’s also a social media app that allows potential customers to find your hotel and book a room – right from Facebook. Desktop, laptop, tablet, or smart phone, Frontdesk Anywhere has it covered.

IDeaS Revenue Solutions

IDeaS seeks to help small chain or independent hotel managers to maximize revenue on each and every room night. No more giving in to the temptation to “say yes to the guest”—any guest—just to fill up your hotel. Tapping into the most up-to-date data available, plus razor-sharp data analysis and uncannily accurate forecasting, IDeaS helps you bring the right guests through the doors: guests who are prepared to pay the right price for the right room.

This hotel revenue management system offers the manager a choice of room rate solutions, letting the manager choose the best one based on an instinctive knowledge of the big picture, while leaving the hard-core number crunching to science-based algorithms.

While the software is easy to learn and use, IDeaS doesn’t just send you a package and leave you to plug and play. Real live consultants can come to your facility to help you customize the software to your needs.

Tune in next time for a look at two more hotel revenue management systems: i-Rates and Duetto!

Smart eHotels helps independent and small hotel chains maximize their GDS and sales; contact our experienced team of hotel marketers today!