Top Ten Questions You Should be Asking Your Revenue Managers

By Paul van Meerendonk Director of Advisory Services, IDeaS Revenue Solutions | September 09, 2012

In today’s extremely competitive hotel market, hoteliers are recognizing the benefits of taking a targeted approach in identifying and reaching guests who will bring the most value to their hotel. Here are the top ten questions that hoteliers should be asking revenue managers to ensure they are making the most of upcoming demand and attracting the right kind of business.

1) Do we have the right data?

Any hotelier with a basic understanding of revenue management principals should know that utilizing data and analytics is the best way to determine marketing and pricing strategies for the future. What hoteliers need to be asking their revenue manager, though, is whether they have detailed data that is both historical and forward looking. Historically, the data should include (at least) the number of occupied rooms, coupled with revenue by market segment by day. Also ensure that number of rooms and revenue on the books by day (and by market segment) for at least the next 90 days is included. If data is collected every day it will allow the hotel to establish simple booking pace forecasts by segment and day of week, from which they will be able to compare to historical data. If this is done consistently, it will allow mid-level hoteliers to quickly pick up any changes when demand increases and enable them to tweak their strategies accordingly.

2) Is our forecast realistic?

Accurate forecasting is the essence of a successful revenue management strategy, but often hoteliers fall into the trap of being overly optimistic about what can be achieved. A simple way to test if a forecast is realistic is to check if daily pick up of rooms assumed in the forecast compares favorably to the actual average daily pick up the hotel has achieved over time.

It is important to view forecasts with a critical eye and constantly reassess them over time because they are the basis of forming your revenue management strategy. If your forecasts are completely unrealistic, you are likely to put the wrong strategies in place and your hotel’s bottom line is likely to suffer as a result.

Coming up in January 2018...

Mobile Technology: Relentless Innovation

Technology has become a crucial component in attracting and retaining hotel guests, and the need to enhance a guest’s technology experience is driving a relentless pace of innovation. To meet and exceed guest expectations, 54% of hotels will spend more on technology in 2018, and mobile solutions in particular will top the list of capital investments. Many hotels are integrating mobile booking, mobile keys, mobile payments and mobile check-in into their operations. Other hotels are emphasizing the in-room experience, boosting bandwidth and upgrading flat screen TVs to more easily interface with guest mobile devices. And though not yet mainstream, there are many exciting technology developments on the near horizon. The Internet of Things (loT) is taking form in some places, and can be found in guest room control systems, voice activation systems, and in wearable sensors that can be used for access and payment options. Virtual reality headsets are available at some hotels so guests can enjoy virtual trips to exotic locations or if off-property, preview conference facilities and guest rooms. How long will it be before a hotel employs a fleet of robots for room service, or utilizes a hologram as a concierge, or installs gesture-controlled walls that feature interactive digital displays? Some hotels are already using augmented reality for translation services, or interactive wall maps, or even virtual décor. This pace of innovation is challenging property owners and brands to stay on top of the latest technology trends while still addressing current projects. The January Hotel Business Review will explore what some hotels are doing to maximize their opportunities in the mobile technology space.