Top 5 Tips for Better Hotel Revenue Management

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There are thousands of independent hotels across the globe and it used to be that getting ‘out there’ in front of would-be guests was a struggle. Indeed, many such properties relied on guests relatively close by, as their only advertising channels were local magazines or newspapers. Now, of course, this is no longer the case and smaller hotels can compete with even the biggest fish in the hospitality industry thanks to the internet and the myriad marketing prospects it offers.However, even in this era of maximum exposure, it is vital to keep an eye on bookings made and money coming in if hotel owners are to maintain a profit and keep a step ahead of the competition. That means implementing a proper hotel revenue management system – and here are a few things that should be on its radar if you’re to keep reservations rolling in.

1.    Pricing You might think that slashing the rates of your hotel rooms is the best way to entice would-be guests, but that actually isn’t the case. A number of studies have shown that keeping rates slightly higher than your competition generates more revenue per available room. It also has the advantage of not breaking parity rates if you’re registered to online travel agents that list your property for comparison sites.It’s also important to limit the number of day-to-day adjustments that you make to room rates.

You might think that you’re creating a buzz by offering random sales and promotions, but they can work against you and annoy would-be guests by making you appear less prestigious. You might also irritate people enough to cause cancellations if they’ve booked a room one day, only to find that it’s a much lower price the next. Instead, work out a price structure based on demand, time of year and other criteria – and stick to it.

2.    Value There are lots of hotels available to travellers that offer very similar rates, so to maximise revenue, you need to offer them something that makes them feel as though they’re getting a better deal. Make your prices seem more of a bargain by mentioning your added extras such as prime location, discounted spa treatments or free off-road parking and you could see more people opting for you over the other property a few miles down the road.

3.    Engagement Ours is a world of constant communication and hotels that better communicate with would-be guests are going to be those that reap the rewards in terms of improved revenue. You need to make sure you’ve got a presence on all of the social media channels your guests use, whether that’s YouTube or Twitter, as well as on local websites and blogs. You could also consider partnering up with other businesses in the nearby area and offering deals to customers that use both you and them, such as cheaper coffees at a cafe when your restaurant is closed or discounted excursions. Look carefully at your website’s traffic and come up with a revenue strategy that will cater for those would-be guests to best engage with them.

4.    A great website Although you should have a presence on various different online channels, your own website is the most important when it comes to tempting travellers and generating plenty of money. Ensure it is exposed to the best of its ability by using intelligent content, search engine optimisation and subtle paid advertising and you should bring in more traffic. In addition, put a good booking engine in place so that making a reservation is quick and easy – don’t forget to test it regularly so you know how simple the booking journey is and if there are any glitches.

5.    Plan ahead Having a proper business plan in place is essential for any company and an independent hotel is no different. In fact, it’s arguably more important for them than for many companies, as guests can be difficult to come by and demand can change on a sixpence depending on factors like the weather. Always set revenue management targets when you draw up your budgets each year and include things like current marketing strategies so you’ve got plenty of scope to bring in new business.

You should also consider your target audiences in this future planning, as modern consumers are very different to the way their previous counterparts were. For example, millennials plan their trips in a contrasting way to baby boomers, with lots of research done on smartphones and social media. Are you catering for your guests carefully and appealing to them directly? If not, think up some new ways to talk to them, such as with special packages and this should impact positively upon your revenues. It can seem like however much money comes in is out of your control, but the above demonstrates how relatively simple techniques can make a big difference to your bottom line.

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