Revenue Management @en

Forecasting: the first step in revenue management is foresight (Part II)


4 December 2014 at 10:00, by


Revenue Management, Google Plus.

Revenue Management, Google Plus.

After our introduction into forecasting, today we are going to discuss the importance of Booking Pace analysis when it comes to putting together the Hotel’s forecast. It is used so the hotelier, using historical data, can see and compare the rhythm the hotel is filled between two periods for each segment.

This way, the Revenue Management team can have a more precise knowledge when it comes to making a Forecast, they will be able to apply similar rates or simply use them as a reference when it comes to assessing their strategies. To interpret the booking rhythm correctly (if the hotel doesn’t have a specific tool to do so), the hotel will need to enter their data into a spreadsheet. The hotel can show various curves here, one for each segment, for example: clients that booked the highest rates and clients that book discount rates.

Booking Curve, César Calvo.

Booking Curve, César Calvo.

To represent the booking curves we work with two variables:

– On the Books (OTB)

– Days before arrival (DBA)

We can also compare the rhythm the hotel is filled for a specific date using historical data. There are many options for analysis depending on the Revenue Management team’s objectives.

Curva de reservas (Hisrorical data), César Calvo

Curva de reservas (Hisrorical data), César Calvo

To interpret the booking rhythm properly, the hotelier can use the spreadsheet data mentioned above, taking into account three items that affect the booking pace. Because there is always a reason behind every rhythm.

1) An increase in booking pace is closely linked to the forecast demand. If this key principle is met, a hotel can sell rooms at the most profitable rate for each moment. We must be careful when analyzing our booking curve. An increase is not always linked to a good Revenue Management strategy. If the increase, graphically represented on the booking curve, takes place during an early phase it could be a consequence of a mistaken demand forecast, price applications, rate restrictions, etc. If the rate grows quickly it could mean the hotel is filled up in advance and not selling during dates closer to the arrival, therefore, losing the chance to sell at a higher rate.

2)  A decrease in booking rhythm is conditioned by the advance notice. There are many factors that influence the lead time of a client’s bookings: financial, social, weather, etc. There is no reason to be afraid. It could be circumstantial or a response to deeper changes in trends. We can see an example of this in bookings made on mobile devises, these tend to be made days before check-in or even on the same day. Planning ahead is being replaced by the instant quality of these devices.

3)  A booking pace has its own dynamic. The booking rhythm is never exactly the same one year to the next. What is essential is to use the results as a guide and if there are large differences, investigate the reasons and work on possible strategy changes.

These are just three keys that the hotelier must take into account when interpreting the Booking Pace, this list could be increased with many important aspects that should be remembered. This shows that a hotel’s Revenue Management strategy must be planned long term with a global focus. However, it is also important to keep an eye out for more sudden changes in the market for each segment and react accordingly.





Idiso is much more than a technological service provider. Our mission is to provide real value to our clients. We want to become THE GLOBAL HOTEL SALES PARTNER, helping hoteliers sell more and better thanks to our 360º distribution and marketing solutions.

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