Short Term Action Plans

By Juston Parker President & CEO, Parker Hospitality Group, Inc. | June 15, 2010

Revenue Optimization as most know has drastically changed over the past few years and is still constantly changing. How people shop and where they get their information changes on a day by day basis. The old adage of "right room, right person, right price" is no longer applicable and a successful property has all bases covered from demand and content management.

As the world of Travel 2.0 grows, the traveler is getting smarter and access to more and more tools they may not have had in the past. Sites such as have made the traveler the one in control. With real time access to like-minded people, the new Web 2.0 allows the potential guest to see what they really want to know about the destination they are going to and this includes value. As the adage goes, price is what you pay for something and value is what you get.

So in this world of the ever changing Revenue Optimization environment how does a property establish short term tactics that can not leave money on the table and truly control the value the guest is looking for? There are 2 key concepts to take into consideration, Demand Management and Content Management.

Demand Management

Managing Revenue is something most properties feel they do pretty well. The truth of the matter is the greatest number of property do Revenue Management as a completed job. Once it's done it's done. In reality, it's never done. Why is that? Optimizing Revenue really is made up of several components, the greatest being Demand Management. In order to move from managing revenue to optimizing revenue, you need to understand your demand and manage it effectively. How is that done? Most properties feel they do a good forecast, well; forecasting is most often used as an end to a means. It actually should be a means to an end. A true demand forecast allows a manger to see what is happening in terms of rate and channel of booking. This then allows tactics to be made to fill in need periods with the best valued guest.

First one must look at where is demand coming from. Demand is much more than just who is booking where. It's what are they booking? What are the patterns? What is the rate they are paying? What do they value? As the answers to these questions are answered, a property is able to then ask, do I value these types of guests or do I need to manage my demand to a higher or better value of guest to me?

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Excellent customer service is vitally important in all businesses but it is especially important for hotels where customer service is the lifeblood of the business. Outstanding customer service is essential in creating new customers, retaining existing customers, and cultivating referrals for future customers. Employees who meet and exceed guest expectations are critical to a hotel's success, and it begins with the hiring process. It is imperative for HR personnel to screen for and hire people who inherently possess customer-friendly traits - empathy, warmth and conscientiousness - which allow them to serve guests naturally and authentically. Trait-based hiring means considering more than just a candidate's technical skills and background; it means looking for and selecting employees who naturally desire to take care of people, who derive satisfaction and pleasure from fulfilling guests' needs, and who don't consider customer service to be a chore. Without the presence of these specific traits and attributes, it is difficult for an employee to provide genuine hospitality. Once that kind of employee has been hired, it is necessary to empower them. Some forward-thinking hotels empower their employees to proactively fix customer problems without having to wait for management approval. This employee empowerment—the permission to be creative, and even having the authority to spend money on a customer's behalf - is a resourceful way to resolve guest problems quickly and efficiently. When management places their faith in an employee's good judgment, it inspires a sense of trust and provides a sense of higher purpose beyond a simple paycheck. The April issue of the Hotel Business Review will document what some leading hotels are doing to cultivate and manage guest satisfaction in their operations.