Technology to Reach Your Hotel Revenue Potential

By Melissa Maher Senior Vice President - Global Partner Group, Expedia, Inc | October 14, 2018

Aside from their guest and overall customer experience, we can likely agree that hotel partners also care strongly about their revenue performance and how they fare against their competitive set. Hotel revenue management has been around for more than 30 years, yet adoption of revenue management technology has been slow – despite the importance of revenue performance as a top principal– with less than three percent of hotels globally leveraging it. Hotels today are often missing valuable access to rich information on competitive sets, market demand scores, pricing calendars and more, which can put them at a disadvantage.

On any given day, a hotel without a functional revenue management technology has a laborious task at hand – and one that is not rooted in the instantaneous insights technology can provide. Think about the number of room types in any hotel, across different days in the future, and across various channels – let alone its pricing to various demographics and origins. It is a time-consuming challenge to manage pricing manually, resulting in hoteliers spending on average between 1 to 3 hours per day on price setting activities.1

Even further, many of the methods and technologies used today also make it difficult for hotels to establish their true competitive set, as they're over-dependent on a static data set, with a lack of transparency around why certain recommendations are made.

Real-time market data is essential when making smart pricing decisions, but large amounts of data can be difficult to manage and expensive to access. Hoteliers often grapple with how best to analyze and synthesize data they can access, to make sense of what it is telling them, so they can turn those insights into actions and report learnings to key stakeholders. Hotel News Now, in conjunction with the recent HSMAI Revenue Optimization Conference, spoke with a panel of revenue leaders and reported that these leaders, representing various hotel companies, are "putting a lot of effort into translating different data streams to help themselves and their stakeholders like owners to understand what's really going on." Data should tell a story about your hotel's revenue performance, not overwhelm or consume your time.

There's also the stigma that hotel revenue management technology can be both costly and complicated. A hotel partner commented, "I have my own process on how I manage my revenue and pricing. I don't have time to change over to something new that's going to be more complicated." It's no secret that changing from how something has historically been done to implementing a new, technology-based solution, can be scary, but the payoff is well worth it.

It's why, at Expedia Group, we have studied, developed and redefined our offering for how hotels access, consume and act on pricing insights and strategy with Rev+. It is available today at no cost to all of Expedia Group's hotel partners. Rev+ is a part of Expedia Powered Technology, a toolkit of technology, marketing and data offerings designed to help our hotel partners drive knowledge and efficiencies to better grow their business.

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Eco-Friendly Practices: Corporate Social Responsibility

The hotel industry has undertaken a long-term effort to build more responsible and socially conscious businesses. What began with small efforts to reduce waste - such as paperless checkouts and refillable soap dispensers - has evolved into an international movement toward implementing sustainable development practices. In addition to establishing themselves as good corporate citizens, adopting eco-friendly practices is sound business for hotels. According to a recent report from Deloitte, 95% of business travelers believe the hotel industry should be undertaking “green” initiatives, and Millennials are twice as likely to support brands with strong management of environmental and social issues. Given these conclusions, hotels are continuing to innovate in the areas of environmental sustainability. For example, one leading hotel chain has designed special elevators that collect kinetic energy from the moving lift and in the process, they have reduced their energy consumption by 50%  over conventional elevators. Also, they installed an advanced air conditioning system which employs a magnetic mechanical system that makes them more energy efficient. Other hotels are installing Intelligent Building Systems which monitor and control temperatures in rooms, common areas and swimming pools, as well as ventilation and cold water systems. Some hotels are installing Electric Vehicle charging stations, planting rooftop gardens, implementing stringent recycling programs, and insisting on the use of biodegradable materials. Another trend is the creation of Green Teams within a hotel's operation that are tasked to implement earth-friendly practices and manage budgets for green projects. Some hotels have even gone so far as to curtail or eliminate room service, believing that keeping the kitchen open 24/7 isn't terribly sustainable. The May issue of the Hotel Business Review will document what some hotels are doing to integrate sustainable practices into their operations and how they are benefiting from them.