Key Revenue Management Trends to Boost Growth

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Revenue Management

There are a lot of ways that hotels can boost their revenue, but it’s important to also look at trends in the market to see the best ways to boost profitability based on consumer needs. What consumers want can change fairly rapidly, but there are currently some key trends which are standing out in the market that hotels can really take advantage of to ensure they’re gaining the most revenue.

Increase profitability

The age of just trying to get the maximum number of people in your hotel is over. Instead, hotels now need to look at how they can increase the profit that they get from each of their online and offline channels. You can’t just plough the same amount of money into each of your channels and gain the same results. It’s important that you evaluate the true cost of each channel and put a strategy in place to get the most profit that you can. Some will perform better than others, and the quality of some may change, so you need to ensure that this is continuously being evaluated to make sure you’re making the most of the money that you’re spending to reach consumers. While it can be relatively easy to measure the profitability of online channels, you need to make sure that you’re also evaluating offline opportunities, such as phone calls and walk-ins.

Direct booking

As online travel agencies (OTAs) grow, big hotel brands are trying to fight this now extremely common form of booking. To achieve this, they’re running campaigns to encourage consumers to book directly, which essentially cuts out the middle man and therefore increases the profit on the booking. To do this, you need to make sure that you’re telling consumers the benefits of booking with you directly, rather than going through another website and making a saving. One of the most obvious benefits is the cost. Currently, OTAs tend to offer lower costs, which is why consumers are so readily using them to book hotels. However, if this trend continues, hotels will be forced to increase their room rates to cover the commission costs to the OTA, which will mean the consumer will end up paying more. In addition to this, you can offer added benefits to guests if they book directly through you, such as half price cocktails at the bar, or a free breakfast per room. While these items come at a cost, they also encourage guests to use your optional services, which they may not have otherwise opted to use. By doing this, not only do you have the opportunity to boost the value of your guests, but you’re giving them a reason to book with you directly, meaning they’re more likely to do so again in the future.

Plan ahead

Of course, there are some marketing activities that are responsive to current events, but you also need to have a solid strategy in place to ensure that on a month-by-month basis your marketing efforts are bringing in the most revenue. Try to lay out a 12-month plan, detailing the channels you plan to use, the budget for each of these, your content strategy and calendar, any campaigns you plan to run and any other marketing activities or events that you know are going to take place. These don’t need to be set in stone, but it’s important that you can forecast your revenue across the next year. Then, make sure that you’re also evaluating each of your channels every month, and if you see that changes need to be made, you can update your marketing plan to reflect these changes.

Use your data more efficiently

As a hotel, you have access to reams of data. In fact, there’s so much that actually it can err on the side of being too much to know what to do with. However, there are now a variety of different tools that can help you to manage this data and analyse it so that it can significantly boost your marketing efforts. There are many players in the market when it comes to providing these tools. They all offer slightly different products so you should explore the market to see what’s right for your hotel. Generally though, they tend to collate all data into a dashboard so that you can then examine the results, much like Google Analytics does for your website data. Having access to this data is priceless, as it’s your own data from your own guests, so it really can’t get more organic than that. Therefore, make sure that you’re using it to your advantage in order to drive your marketing strategy and enable your revenue to grow.

Be aware of mobile

Mobile is growing immensely quickly, and it’s rare to see many people without a mobile phone in their hands these days. When it comes to booking travel, more people than ever are choosing to do this on a mobile device. According to a Criteo study, mobile accounts for most of the overall growth in travel bookings since 2014. The share of mobile bookings has increased from 12 per cent to 23 per cent from 2014 to 2015. In fact, forecasts by eMarketer predict that mobile will make up more than half of all online travel bookings in 2016. So, with this in mind, hotels need to be sure that their calls to action are just as prominent on mobile and that their mobile website is fully optimised. Part of the reason that so many people now book on mobile devices is that they’re so often on the move, which means that if your website is slowing them down, they’ll quickly turn elsewhere to make a booking. You need to make sure that the speed of your website is as high as possible, as well as making sure it’s laid out in the best way to ensure that the customer journey is a simple process.