A Guide to the Key Factors That Drive Hotel Revenue
By Gino Engels Co-Founder, OTA Insight | July 14, 2019
Revenue is fickle. Sometimes it smashes forecasts; other times it proves more elusive. Chasing revenue can lead to a reactionary approach that lurches from one direction to another. To avoid this wasteful effort, focus on the factors that impact your hotel's revenue. Then it's all about mastering each revenue driver to keep that trendline marching upwards.
Demand correlates to revenue. This maxim is most visible in the way that the local events calendar accounts drives demand.
Using our Rate Insight tool, we looked at the G20 Summit in July 2017 in Hamburg for an upmarket hotel in the city. The image in the carousel below reveals the dramatic spike in advertised rates around the time the event was taking place on Thursday 6th July that year.
The thick orange line is the median BAR for the compset, with the paler orange shading representing the range.
Even in this limited analysis, events not only cause a spike in advertised rates, but also expand the range of rates. Some hotels are charging far more than others in this compset, likely resulting in a commensurate revenue boost. When events constrain capacity, there are many opportunities to maximise revenue.