From Managing to Generating Customer Demand in Revenue Management

With the stagnation in the market today, hotel revenue managers need to shift their focus from managing demand to generating demand. Supply will remain consistent because with the exception of capacity expansion, this inventory is fixed. Previously, hotel revenue management was designed to maximize profits during the high and peak season. After all, any yield management teams are always on the lookout for better business ideas that will increase hotel sales and boost profitability.

No one probably expected that such a drastic turnaround can occur within such a short timeframe. Right now, every hotelier is scrambling to use hotel revenue software not to manage demand but to increase it through accurate price predications, improve hotel online channel distribution, and analyze market conditions. Nevertheless, it is important to recognize that hotel revenue management plays an even bigger role in the tough times than in the good ones. To help you improve your yield management strategy, below are some tips:

Analyze Existing Market Strategies – before reacting to current difficulties in a “panic” mode, it is important to step back and see what methodologies are currently effective. If the previous marketing plan implemented by the hotel is still working, it would be best to complement it instead of eliminating it altogether.

Restructure the Value Proposition of the Property – what kind of message does the hotel send out to prospects? Looking into the value proposition found on the website, travel portals, and even travel agencies have a great impact on the customer’s buying decision. It is crucial to know whether you should brand your hotel as a “family-friendly” establishment, a “pet friendly environment”, a “business accommodations hotel” or any other proposition.

Make the Customer Find You – potential customers cannot stay at your hotel if they don’t know you exist? Market your hotel effectively online and offline. Your business should be visible across all hotel sales channels. This is one of the key methods of increasing hotel bookings and RevPAR.