A combined strategy more than just pricing. This is what the market demands to satisfy discerning travellers who have the option of using the Online Travel Agencies at their fingertips
Revenue Management strategies have become obsolete, according to Hotelnewsnow. The publication has brought together several experts in the field to express their opinion in this sector and they all coincide: techniques used today must be innovated if hoteliers want to avoid losing prominence against intermediaries.
Tom Botts, Denihan Hotel chain Vice President downplays rates. “A good price is less and less important for guests, but makes the hotelier feel better.”
Ash Kapur, Starwood Revenue Management and Distribution Vice President points in the same direction and opts for a technology refresh. “Professionals need to focus on improving their booking processes. An experience that begins long before the guest arrives at the hotel, “he comments.
Kapur proposes a more dynamic segmentation from pricing. The rates should vary depending on different demands, room categories and customers. Botts emphasises this point and insists on another factor: talent.
“The election of this area manager is of great importance and in addition, the anticipation in the sector. Forecasting demand strategies must be updated so as to cope better with the hotel distribution world’s new realities.”
For this reason, the article suggests some ways to innovate:
Offer flexible rates according to room type
Ensure that price parities being shared with the OTAs
Comparing nonrefundable rates ensures that the real distribution and management costs are included in the final price.
Moreover, Ehotelier analyzes the present moment of the Revenue Management. Indicating that at the moment there is still a little confusion inthe industry when considering the best option to maximize profits. Contrary to what is sometimes thought, lower prices during low occupancy periods is not always a good idea.
Offering cheap rooms can also project a negative image for the hotel.This perception is very difficult for potential customers to forget, as it tends to persist over time. Hoteliers need to understand that ‘gift’ offers can cause problems for their establishment, possibly because customers associate low cost accommodation with a brand when in fact it is not.
For this reason, the importance of good segmentation is supported, confirming that a proper guest profile division is the best antidote against the temptation to lower prices in low season.
Proper customer categorization assures controlled and profitable discount application.Nowadays kindness and empathy is more valued by customersthan the price of the room they book. According to the article, lower rates with great discounts is on the way to becoming an emergency solution or a last resortto ensure a good occupancy level.