Analytics, the 'Holy Grail' of Revenue Management

By Lily Mockerman Founder, TCRM | March 12, 2017

Analytics are what some might call the 'holy grail' of revenue management. We build technology to try to capture them, seek new ways to apply them, and wonder how to use more of them. Dashboards and reporting suites are touted by vendors of all sorts as key to the value of their products. Meetings are driven with reports spread across a table or screen as various players on the team work to make sense of the numbers and what they mean for their business. Analytics help give us the information needed to relay suggestions to marketing, advertising and public relations teams to help identify areas that are currently experiencing success and others that may need improvement. They can be used to help predict consumer behavior and provide effective ways to use product availability and price to maximize a company’s revenue growth. Using analytics as a foundation allows hoteliers to enhance their ability to shed light on how the guest will behave before, during, and after the travel planning process.

As is often discussed in leadership circles, the best predictor of future behavior is past behavior. The data analytics provides can be harnessed to predict future actions. Analytics are also imperative to forecasting both the subject’s and the market place’s pricing and product availability.

Big Data is the new hot button for analytics, with increasing conversation around how to harness and use it at the hotel level. Per an article from Forbes, Big Data can be seen as a collection of data from traditional and digital resources from inside and outside a company that can provide a source for continuous discovery and analysis.

Each individual guest will check into a hotel with their own set of expectations and preferences, and it has become the job of Revenue Managers to help identify areas of success and failure, so that hoteliers can achieve those expectations to deliver a returning customer. To do so, we must use in-depth data and resources to help us differentiate between customer preferences. However, despite our refrain of better use of analytics, we still misuse or ignore the basic capabilities we already have.

In the use of analytics, we see three primary issues:

  1. Collection Addiction - When a company has a high level of focus on collection
    of data from multiple points but doesn’t place enough emphasis on effective
    application, leaving them with a disjointed data warehouse of unusable
    metrics. Companies can gather an influx of data that may help tell a story,
    but if they don’t have the ability to effectively apply the information,
    then it will be considered useless. This issue often presents itself when
    working with big data.

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.