Rate Integrity at Times of Economic Crisis Part 2

It is safe to say that the world has changed. The hotel revenue management strategies that worked a decade ago may no longer work today. But throwing all rate integrity strategies out of the window isn’t right either. It is crucial for hotel revenue managers to be smart in formulating and implementing yield management techniques in today’s business and leisure environment. Discounting across the board might increase hotel occupancy, but it may not necessarily increase hotel RevPAR and boost profitability.

So is avoiding drastic rate discounting a good strategy? It might sound like it but at the end of the day, hotel revenue managers still need to find a way to fill out those rooms. A creative and dynamic solution is required to solve this problem. Rate discounting might just do more harm than good over the long term. Here are some proven strategies to check out:

Rate Parity – though this can be used as a guideline, it is not a law. Revenue management staff knows that hotels need to please distributors in order to succeed. Without hotel rate parity, making a hotel profitable is difficult, if not nearly impossible. Adapting the strategy to certain market changes and being dynamic builds on the success.

Price Fencing – reward guests for loyal stays. If they stay for a week, maybe you can offer then 1 night free. Or if they reserve for five nights (or any length you have in mind), give them steep discounts.

Lead Time Pricing – giving early bird discounts is still a strong strategy. Determine your booking window and then before the usually pick-up curve, this is where you can offer the discount. Your competition might still be asleep while you are eating a significant portion of their market share.

Rate Integrity – this is what the article is all about. It is actually not necessary to maintain your old rates. However, it’s not required for you to go as low as your competitors as well. Just look at the stock market, sometimes it is up and at other times it is down. The same principle works in hospitality revenue management. Just never go too low that your brand itself starts to suffer.

5 Effective Ways to Get More Friends, Followers, and Fans Online

So you’re interested in building substantial web presence on the internet, now the question is, what strategies will make it possible? There are actually so many ways to promote a website over the internet. Selecting the right strategy is a different matter.

Beyond search engine optimization (SEO) and pay-per-click (PPC) promotions, building a large following through social networking sites can encourage loyalty. Gaining customers in the hospitality industry doesn’t usually work when someone visits your site for one time; it is about gaining their trust and confidence. This is a good way to increase hotel sales and boost profitability.

Some of the strategies you can implement to increase RevPAR include:

Start with Individuals Who Already Know Your Company – try adding a Twitter or Facebook address on your company’s site and at the bottom of your email signature. Readers will be encouraged to sign up. And once they do, this is a chance for you to strengthen your relationship with them and improve hotel revenue.

Build a Social Hub – be sure to include a social hub webpage on your site. This can be the “About Us” section, just include options such as “Send to Friend”, follow, and become a fan options. This will enable them to be aware of new developments on the site as well as share your business to others.

Invite People – pepper your website with invitations for people to become your friend, follower, or fan. Once they accept your invite, they will receive notifications every time new developments are posted on your site.

Interlink Your Social Web – this is an incredibly helpful technique. If you already have thousands of “friends” in Facebook, place your Twitter links to your page as well. These will help you build a loyal fan base that is updated about your current promotions and hotel revenue management strategies.

Give People a Reason to Join – because social media has been abused by many users, it is inevitable for individuals to be wary of signing up or joining the social network of a company. Make sure you give them something to join whether it’s great content, cool offers, or discounts.

Try to implement the above-mentioned techniques and watch your hotel profits shoot up.

3 Tips for International Hotel Internet Marketing

Catering to an international audience is very important in the hospitality industry. For this reason, hotel revenue management teams should look beyond their borders and look at opportunities elsewhere. A lot of yield management practices make the mistake of focusing too much on developing an English website without considering how they can promote their hotel internationally. Some of the principles in search engine optimization in English-speaking countries are also applicable elsewhere.

But it is also crucial to remember that there are cultural connotations in the wording of these sites. People will type the content differently. Improving hotel SEO means that hotels should be aware of these differences and think of ways to take advantage of it. It is challenging to optimize a hotel website for an international audience at the same time to boost profitability. There are certain guidelines that can help your online hotel distribution strategy a success though. Among these are:

Language Targeting – obviously, targeting an international audience means creating a website in that language. However, some hotel revenue managers make the mistake of simply translating their English content to another language. Direct translation would not be that effective in this case, it is important to consider accurate translation containing words international audiences use.

Register at Local Search Engines – registering at top sites like Google and Yahoo is a must. But in certain countries, there are preferred search engines that locals patronize. In addition, registering a physical address in that location may also be beneficial. It will give you the advantage of local listing. The process is pretty straightforward and is quite effective.

Relocate Your Site’s Hosting – one highly overlooked factor is where your site is hosted. Most hotel revenue managers will simply set up a virtual host in their existing server. While this is acceptable, it is important to note that Google and other search engines actually give priority to web servers located to the origin of the search. That is, if your targeted searcher is searching in France, Google prioritize the sites hosted in that country.

Optimize Hotel GDS Distribution

The objective of improving the hotel distribution system lies in the Global Distribution System and it is not really as difficult as it first appears. Effective hotel revenue managers know that they can easily take control of their hotel GDS by knowing the opportunities available in their properties. These opportunities can range from marketing the hotel using targeted advertising so that they can be placed at the top of hotel listings.

Meanwhile, doing simple steps like using revenue management features such as “Hotel UpSell” and “Best Available Rate” can help as well. It is important to realize that there are actually tons of available opportunities to advertise within the hotel GDS. Still though, hotel revenue management teams should determine when the best time to advertise is and what messages should be given.

Specific GDS Promotions

Specific messages should also be promoted. For example, in some cases, hotels want to market a specific destination while some are pushing their brand to a new target market. A lot of GDS today can provide personalized programs that are customized according to the hotel’s needs. It can include various advertising tools that are available in the hotel distribution system.

Effective advertising tools usually available from major GDS include:
• Sign-in Advertising – direct advertising messages during at the period of signing in to the GDS by agents.

• Targeted Textual Advertising – helps hotels promote the products and services to the target market during the time when they are ready to make their decisions.

• Travel Agency Portals – usually related to graphical user interface or GUI. Hotel GUIs allows hotels to use the combination of text and graphics to make a bigger impact. Because of this, the tool is particularly beneficial when promoting brand awareness or a certain property with pictures.

• Online Itineraries – more visual content is used in this case. The strong images coupled with the strong push marketing strategy helps hotels make a greater impact in the minds of their consumers. This can ultimately increase hotel sales.

Each GDS should provide targeted promotional tools so that hotels can use this to further promote their brand or properties. Meanwhile, online hotel GDS can be composed of travel agency portals, internet brochures, and online itineraries; these can be maintained by the hotel itself depending on the GDS in question.

Hotel Industry Expectations for the Second Half of 2009

According to the PKF Hospitality Research, RevPAR which is an important indicator of the hotel industry’s health, will bottom out in the third quarter of 2009. After months of decline, it is expected that the industry will finally rebound. This news is bound to give hotel revenue managers around the world a sense of relief. The escalating trend of declining hotel revenue began in the third quarter of 2008 so it really does come full cycle if this trend reverses itself in a one-year timeframe.

The President of PKF Hospitality Research Mark Woodworth said that while their finding is welcome news, 2009 will still post the “weakest year on record for the domestic lodging industry”. In addition, revenue per available room for 2010 will still be disappointing even if it is not as bad as this year. Taking into consideration the employment level and the demand for lodging, it becomes clear that RevPAR can decline by 17.5% overall for 2009. In 2010, decline in RevPAR will not be as bad but it is still at 3.5%.

These factors point to the conclusion that effective yield management should still be practiced by the revenue management team. Also, the hotel revenue management strategies such as increasing online presence, using hotel software, and training the service staff should be continued and further strengthened to give hotels a competitive edge.

Mr. Woodworth further added that “If you are wondering when we’ll start to see actual growth in RevPAR, then you’ll have to wait until 2011” though the “operating environment is going to get a little less painful”. The decline for lodgings in the United States peaked during the first quarter of 2009 at 8 percent. According to the Hotel Horizons, demand will continue to regress but at a diminishing rate.

For the remainder of 2009, the projected quarterly decline is 4.7 percent on the average. Overall, hotel revenue will decrease by 16 percent this year because of the decline in RevPAR. Beyond the year 2009, there will be an average annual increase of 3.2 percent in the next four years according to the same study.

U.S. And Europe-Based Hotels Took a Big Hit in RevPAR

With the latest industry data being analyzed, it was revealed that the hotel industry took a sharp decline in RevPAR last April 2009 according to the Smith Travel Research. Even as the financial markets stabilize and the overall economy gain momentum, the hospitality industry is taking its time to respond.

The data revealed that all four major regions including Europe, Asia Pacific, the Middle East, and the Americas suffered from double-digit decreases in all fronts. From their occupancy level to their revenue per share (RevPAR), everything was down compared to 2008.

These revelations are not surprising at all for an industry that’s reeling from the effects of the economic downturn. Almost every known strategy is being implemented to increase hotel sales and boost profitability even during the trouble times. Some hotels are resorting to price cuts while some are focusing more on their hotel revenue management endeavor. Whatever the case, it is clear that the path to recovery will not be easy given this data.

In the Americas, occupancy declined by 11.3%. It now stands at 56.5%. The bad news doesn’t stop there because the average daily rate also declined by 10 percent. Meanwhile, RevPAR which is an important indicator of a hotel’s financial health, dropped by 20 percent as well. Now, hotel revenue managers need to determine what they should do with this inventory. It is the only way to maximize hotel profits.

In London, the same grim situation is happening. RevPAR has dropped by 9.7% in the capital, London, while it declined by up to 14.6% in the nearly provinces. It is apparent that the city experienced a drop in occupancy rate and average room rate as well. But the situation is not as bad in the United Kingdom as it is in the United States at this point. Occupancy is still at 71.4%. It is only a question of whether this rate can be sustained or improved.

Integrating Web 2.0 in Hospitality Revenue Management

Marketing and revenue management, at its core, have the same aim which is to improve profit and minimize expenses. Yet, the effectiveness and efficiency between the two systems can sometimes contradict each other. There is an undeniable tension because while both are aiming for increased hotel revenue, there is also the possibility that the brand integrity will be compromised. This is an issue that is sensitive for both parties.

Other issues that both marketing and hotel revenue management needs to deal with is the emergence of new technologies. With the internet becoming a significant player in the travel industry, it has now become more important to create a positive image online. This can be done through creating a website, forming partnerships, and most importantly making use of viral marketing.

New media capabilities, both informal and informal, can drive tons of traffic into a hotel’s website. Once the visitor goes into the site, there is a high chance that this will convert into sales especially if the hotel is in the location the traveler wants to go to. According to travel industry experts, the social media is the new television. Children, young adults, and even the older audience are familiar with the way the internet works. In fact, a significant portion of the population spends more time on the internet than watching television.

Now, the question that most hoteliers face is, how can they take advantage of viral marketing to boost profitability over the long term? The answer is both simple and complicated: building relationships with customers and prospects. This will enable the hotel to increase brand awareness through word of mouth.

It is true that paying for advertisements and other paid programs can still work. However, internet users have more choices than they do in television. They can’t be forced to think one way when there are so many choices available to them at the click of the mouse. What changes their mind and make them prefer one destination over the others are the opinions of their peers and the feedback they receive. If hotels are able to utilize viral marketing well, it will help them increase RevPAR and increase hotel sales overall.

RevPAR Helps With Yield Management

As an important contemporary management practice, yield management helps hotels maximize profits and minimize expenses. Essentially, it guides the hotel to sell hotel rooms to the right customer, at the right price, at the right time. Hotel management should not price hotel rooms at discounted rates if it can be sold at rack rates the next day. Likewise, it is important not to price rooms at peak-season rates during the lean times because it will remain empty otherwise.

RevPAR Guru enables hotel revenue managers to increase hotel sales by letting them know when to price higher or lower and when. This inventory software and hotel revenue management software is the perfect assistant when it comes to generating hotel sales. Developing new strategies that fit with the times is possible with this automated software solution. In order to appreciate how RevPAR Guru works though, it might be a good idea to go back to the core of revenue management.

The creators of this application understand that each individual hotel has its own needs. After all, it has its own historical data about their customer’s stay frequency, length of stay, group statistics, number of meeting, and corporate clients that pay either the rack rate or the discounted rate. By using these data coupled with market information, competitive analysis, and accurate forecast, the future need not be a foggy environment.

Future demand can be predicted accurately. The positive and negative demand can also be integrated into the business model to provide the most effective results possible. This model can be updated real time depending on the trends in the market. For example, if an unexpected local event is scheduled in the near future, hotels in the area can increase their rates to increase RevPAR and improve hotel revenue.

Being aware of these happenings in the travel industry, RevPAR Guru is created with a flexible module that enables hotel revenue managers to make changes when appropriate. This hotel management software can also deal with unexpected cancellation, early check-out, additional demand, no-shows, and a variety of other instances that are subject to human preference. As a result, hotels that use RevPAR Guru as their software can expect additional hotel sales and profit optimization.

Market Demand: Should You Lower Hotel Rates?

Anyone involved in revenue management can reveal that the reveal that the hotel demand pattern nowadays is completely different than they were previously. Now, the question remains, will this trend continue or will it revert back to its previous pattern? This is a very important concern because it determines whether hotel revenue managers should “hang on” until the times get better or if they should think out-of-the-box and implement innovative measures that will ensure their survival in the future.

From all indications, the impact of business and leisure travel on hotel sales has been significant. Companies around the world are cost-cutting by reducing spending including corporate travel. Instead of cutting back on travel completely though, they are choosing shorter trips and less-expensive hotels. Meanwhile, leisure travelers have also changed their attitude. Many are opting for travel packages to save money. In addition, around 84 percent of all American travelers are trying to cut cost by staying fewer nights or taking more day trips.

It is apparent that the current trend has become the “new normal” today and in the future. This is because even if the economy picks up, old habits will be difficult to break. People who are used to spending less are most likely to set aside the same amount for their travels in the future. Also, as business and leisure travelers realize that there are a lot of deals (due to price cuts) out there, they will demand the same pricing level next time.

So is there a positive aspect in all this? Innovative hotel revenue managers will certainly answer yes. The current condition gives them a chance to increase RevPAR, improve electronic hotel sales, and boost profitability all at the same time. It is true that the knee-jerk reaction for most will be to lower hotel rates to maximize profits. Yet, the true essence of yield management doesn’t work that way.

Do not lower hotel rates too drastically. You may be thinking that “it is easy for you to say” but over the long-term, you will see that this is a good strategy in revenue management. The profitability of hotels lie on its perceived value compared to the competition. If your value proposition is low-rates, then you will not be able to increase hotel revenue as much as you can. Balancing hotel rate and its value is the task that good hoteliers should complete.

Hidden Ways to Increase Hotel Revenue

The goal of every hotel revenue manager is to optimize sales from every channel including the central reservations office. A lot of hoteliers make the mistake of overlooking this area. Depending on your target market, the total contribution from the central reservation system can be anywhere from 10 percent to over 35 percent. It is important to give every hotel sales channel the best tool for conversion.

Increasingly, hotels are concentrating their efforts on increasing hotel online sales. There is nothing wrong about that especially since online bookings have been experiencing significant growth year in and year out. But this development doesn’t mean that other sources should be overlooked. On the contrary, it is possible to achieve profit optimization in both.

In addition, the two hotel distribution channels can actually complement each other. Today’s savvy deal-seeker is checking both mediums. For example, they try to look for the best rates online before calling the reservations system so they can be sure that they are given the bets rate possible. Realizing the interconnectivity of hotel electronic sales and offline sales can prove to be beneficial for property managers especially in today’s economic crisis.

Below are some tips that can help you increase hotel profit:

Use Alluring Descriptions – first of all, it is important to go beyond the standard feature of the hotel and highlight the things that make your property stand out. Also use words that entice rather than simply inform. Most clients will respond to visually descriptive language that paint pictures on their minds. In many cases, they will book their reservation even if the rate is priced higher than the competitor when the picture is already painted on their minds.

Update Property Information – keeping the information updated on both the hotel’s website and the central reservation every six months is critical. All data that is no longer relevant should be eliminated. Otherwise, guests might expect certain features that are not available anymore or miss out on new developments about the property.

Make Sure All Key Attractions are referenced – probably one of the primary reasons why people stay at hotels is its location. If you are located near business parks, entertainment centers, or even a popular business complex, be sure to include it in marketing. Also, major events including festivals, air shows, and sporting events among others might interest the guest.

By following the tips outlined above, your hotel will hopefully enjoy increased RevPAR. This is especially possible if it uses RevPAR Guru as a tool for profit optimization.

Automated Revenue Management Will Improve Efficiency

When organic hotel sales start to go down, hotel revenue management takes on a new level of importance. This is because it becomes critical for hotels to go after the remaining market. The marketing department will also experience the same problems and opportunities. To reduce redundancies, the two can be meshed together.

Avoiding Redundancies

Implementing technologies such as the RevPAR Guru can help boost efficiency greatly. This solution can provide automated forecasting not only for North American properties but for properties anywhere in the world. A significant number of man-hours can be saved. And the best part is, the result of the system will increase RevPAR and manifest itself to profit optimization.

More than using technology though, there should also be cooperation between the hotels sales & marketing department and revenue management. By working together, hotel managers can identify areas for promotions and what the optimal hotel rate should be.

In the previous articles, we have discussed the tension between the two groups. For example, the misconception of hotel managers that sales are only interested in profits. This type of thinking should be eliminated for any type of effective cooperation to take place.

RevPAR Guru as a Tool

Before RevPAR Guru has been introduced, hotel revenue managers simply used Excel to calculate the appropriate rate. This is time-consuming and typically inaccurate. But there is no need to say with this old style. By using algorithm processes to process data, the software is able to project how much the hotel can expect from its transient sales.

However, thinking that any software application can replace the touch of an employee is quite misguided. It should be seen as a tool rather than the ultimate solution. For example, it is not a substitute for hotel revenue managers. Some tasks that are related to hotel management are things that only a human being with actual experience and rational thinking can solve.

With this in mind, it is even more important to respect the capabilities of hotel revenue managers. It is true that technology today is incredibly advanced. Booking software, inventory software, and revenue management software are impressive. Without a human to feed and interpret data though, software applications can do just the opposite of what they were designed to do.

Boosting Electronic Hotel Sales with Social Media

With the number of user-generated content websites and social media sites today, making sales is all about interaction. These interactions need to go beyond the one-on-one interactions that characterized the hotel’s strategy in the past. Now, it is all about networked relationships that connect different people to events, places, and other people. How can this be done? Well, in most instances, the best medium for this type of interaction is the internet.

Aside from the fact that internet users and travelers booking travel over the internet has been steadily increasing, technological innovations also made it possible for properties to boost hotel sales through interactive hotel electronic sales channels. With the effective utilization of social media, hotels can increase RevPAR and achieve profit optimization.

It is important for hotel revenue managers to realize the potential of investing in technologies that will enable them to build relationship with consumers online through conversations, customer service, and honest reviews. Hotels should focus on websites where their target consumers spend significant number of hours. Social media and user-generated content can provide free marketing, connection, and commerce to the hospitality industry and ultimately increase hotel sales.

But before you engage in such endeavor, it is also important to note that leveraging on this trend relies on consumer reach and brand awareness through effective placement in social networking sites. There are some tips that will help you in this.

Identify the Most Appropriate Social Media Sites – there are numerous Web 2.0 websites over the internet. It can get expensive and confusing if you try to use every single one of them. The key is to concentrate your efforts only on the most appropriate sites to increase hotel sales and boost revenue.

Interact with the Target Market – interaction can be tricky. For example, if you decide to open a MySpace or Facebook account, it is essential for your market to be added as your “friends”. Meanwhile, blog sites can likewise be effective but it takes time and consistency to gain the loyalty of your readers.

Provide Packages that Offer Value – after you gain the trust of your target customers, the next step is to offer hotel packages or special discounts with the goal of increasing hotel revenue while strengthening customer relationship. By interacting directly with the target customer, it becomes possible to offer to best rates because it cuts the middleman, such as travel portals, out of the picture.

Using Hotel Revenue Management Software to Increase RevPAR

A Cornell University Study, published in the Analysis if Revenue Management Vol. 5, No. 6, in the April of 2005, revealed that hotels that price above their competitors have the most aggressive hotel revenue managers. They are the best when it comes to increasing RevPAR, improving yield management, and boosting profitability. Many hotels want to raise their room rates in order to increase RevPAR but this strategy may not always work. Its success depends on brand image, amount of available facilities, location, demand, the number of competition, and general economic condition.

It should be noted though that the most successful hotels when it comes to revenue per available room implements hotel revenue management strategies. However, it you should note that the requirements of revenue management systems for individual hotels are different. For example, the needs of a 50-room boutique establishment are far different form a 600-room chain hotel. Before buying inventory software, booking software, or a yield management software, establishing the exact requirements of the hotel in terms of RMS systems and functionality is important.

If you’re anticipating the implementation or the upgrade of a system, evaluating the potential return of investment of the revenue management systems including their sustainability needs to be done. Below are some guidelines that will help you find the best hotel revenue management software:

Departmental Needs – each department has its own requirement when it comes to documentations needs, report, and other data gathering and retrieval technique for effective decision making. Hotel revenue managers need to know the minimum and the optimal requirement of each department.

Existing Hotel Revenue Management System – if you already have a revenue management system in place, consider if it would be more cost effective to replace it or to add certain functionalities. In addition, be sure to find out what the exact requirements are. The last thing you want is to have the same problems in the new system.

Hotel Channel Management – most hotel applications have this feature. Finding the right one is only a matter of how complex your business structure and the promotional mix. A system that allows you to evaluate the different revenue streams is a particularly effective one.

Customer Behavior Analysis – a good revenue management system should be able to forecast customer behavior based on historical data and customer information. The information helps the hotel revenue managers make better decisions based on actual data, not on guess work.

Price Integrity for Hotel Revenue Management

Hotel revenue managers have started to understand that consumers are now more informed than ever. Right now, most travelers know about hotel rate parity, rate of day fluctuation, and the availability of rate types. As a result, they achieve more buying power. Property owners are left in the position of increasing their competitiveness using new technologies in order to boost hotel sales. It is important to find out what the real cost of using hotel distributions are including the returns each channel provides to profit optimization.

Given the importance of minimizing costs and the need to improve the yield of each channel, hotel revenue managers should encourage consumers to book using the most affordable and profitable channel possible. But there is a danger to this in rate parity. Remember that the hotel rate parity must not be overlooked so various levels of value in booking is a good option.

Many hoteliers have a lot of things to consider. Revenue management also involves analyzing the consumer’s acceptance of price strategy modifications. Some markets are more sensitive than others. In addition, the overall economic condition also contributes to price sensitivity. Hotel revenue management consultants also say that knowing about the current political and competitive environment is crucial because different consumer segments will react differently. Historical data, primary research, and the existing level of hotel sales all point to the price sensitivity of the consumer.

Price Integrity – Increasing Hotel Sales

No one in the hospitality industry can deny that price is a critical weapon. Outside the hotel industry, the same concept holds true. Price can make or break you. The consumers will only pay premium rates for something they perceive as having premium value. To encourage these types of sales, it is important to create confidence in the brand, hotel services, and overall impression.

In many instances, adaptive pricing strategies need to be implemented. When hotels want to increase occupancy, aggressive pricing can be used. Discount pricing is particularly notable during off-peak periods to boost profitability. There should also be packages that will appeal to various segments of the market. Certain segments need specific services while some need only basic accommodation.
All these factors need to be considered in hotel revenue management. But it is always important to keep in mind that offering the same packages at different rate is never a good idea. It will confuse the consumers and will make them feel cheated if they paid more.

Increase RevPAR by Improving Performance

Revenue per available room (RevPAR) is an undeniably an important factor in increasing hotel sales and boosting profitability overall. However, in some cases, it is also critical to look at other factors that might affect performance. Decisions surrounding the hotel size, long-term strategy, and service orientation all play a role in the hotel’s profitability. Take note that aside from RevPAR, another metric of the hotel’s financial health s performance. When times are lean, hotel revenue managers need to improve operational processes in order to enhance hotel profitability.

On the other hand, performance is also essential during the good times. It can be used as a tool for profit optimization. Effective hotel rate distribution, rate strategies, and the use of forecasting and inventory software are all helpful in ensuring the best results possible. Sometimes, certain hotel chains even take over their competitors in order to experience economies of scale through productivity gains.
There is no doubt that once hotel revenue managers understand how important productivity, RevPAR will increase. These two elements complement, rather than contradict, each other. But many make the mistake of concentrating on one but not the other. The balance between occupancy rate and hotel room rate can be categorized as RevPAR, it basically shows the income of the hotel. Meanwhile, performance and efficiency has more to do with controlling costs.

Hotels are generally labor-intensive but it does not necessarily mean that hotel revenue managers should allow the property to lose money just to keep up the current level of service. Improving efficiency may be a challenge but it is definitely possible to achieve. Today’s hoteliers find today’s condition particularly difficult though because there are too many rooms that are left unoccupied while fixed labor costs still remain.

Fortunately, there are tools like RevPAR Guru. This software application provides real time information about historical data, occupancy levels, and available amount of rooms. Good decisions can be made in real time. Prices can be adjusted according to actual demand and supply while unnecessary costs are eliminated through the use of this accurate forecasting software. It is not surprising that a lot of hoteliers are looking into this software for a solution. In tough economic times, there is no room for error. Basing your decisions on facts, and not guesswork, is your best bet in surviving the current downturn in the hotel industry.

Social Media for the Hotel Industry

With the large number of Web 2.0 websites these days, it is not surprising that a lot of people are spending a lot of time online. Social media and sites that focus on consumer-generated content get a lot of buzz because it goes beyond traditional business to consumer interaction. Nowadays, people can interact among their peers and other users to get the best information possible. In addition, the social media creates networked connections and one-on-one relationships among people. Significant events, current developments, and interesting trivia are shared "virally".

To cope up with these changes, the hospitality industry needs to know where and how to concentrate their efforts. Market research is required. For example, it is critical for hotel revenue managers to identify where their target consumers usually spend their time only and then focus on these websites. According to hospitality experts, hotels face a challenge of reaching out to consumers that use these media. If they are successful, not only will they retain their current market share, they develop new markets as well.

Essentially, it is important for hotel revenue managers to realize that utilizing social media is almost free. But it requires a lot of effort, promotions, and marketing. Building connections and being with the community is two of the most important factors to increase hotel sales. Profit optimization can only occur when hotels understand how leveraging works online. Web 2.0 technologies enables them to build brand awareness and consumer loyalty through proactive endeavors that boosts profitability.

It has been said that careful targeting and the consistent delivery of relevant messages is the key to successfully using these tools. Together with market research and marketing though, it is also critical for hotels to implement the most effective hotel rate distribution strategy to increase hotel electronic sales. Some tools that will help include forecasting software, price distribution software, and inventory software.

In addition, utilizing search engine optimization and search engine marketing techniques are also essential in these endeavors. Nowadays, there are a lot of web marketing applications that has been designed to improve traffic and brand recognition. The software can also be used for other industries aside from the hospitality industry. This is because the necessity of adapting to new technologies is not only apparent in hotels but in the overall business environment as well.

Hotel Revenue Optimization Strategy

Hotels around the world are battered by the economic crisis – so what else is new? Things are about to get worse. With today’s current climate, industry experts estimate that RevPAR (revenue per available room) can drop by as much as 11% or more. Since hotel occupancy rates are already at their all-time lows, this isn’t good news for hoteliers and revenue managers at all. In this climate, most hotels will compete on rates instead of service. Instead of making things better though, this strategy will only create a downward spiral that has no end in sight.

How Can Hotels Compete Beyond the Discount?

One of the most important issues that should be determined is whether or not it is possible for hotels to flourish during the travel slowdown. Jean Francois Mourier, the CEO and Founder of RevPAR Guru, see revenue management as the solution. A Miami-based property which had previously been struggling to maintain a 45% occupancy rate saw this figure jump to 90-94% after restructuring its revenue management system. Revenues increased by 70%.

Sounds too good to be true? Not according to Mourier. Hotel revenue management is one of the most critical metrics in the hospitality industry. After the right system is in place, it can be the solution to the outdated industry standards that no longer meet the demands of today’s environment. RevPAR Guru is an alternative type of revenue management system as well as a pricing solution that helps hotels increase their profits even as the economy goes into deeper recession.

Increase Hotel Sales and Boost Hotel Profitability

Today’s environment requires hotels to adapt measures that range from improving direct marketing and to boosting loyalty programs. However, it is also important to take note that these measures cannot be sustained optimizing the cost centers. With this in mind, revenue management that is both effective and efficient is imperative. Mourier provides the following tips on how hotels can increase their RevPAR:

Boost Internet Sales

Discount-hungry consumers use the internet to book their accommodation. It is vital for hotels to have an internet presence to gain exposure and brand positioning.

Open Sales Offices at Night

When you’re not operating 24/7, you’re missing out on a lot of opportunities. Making updates and booking reservations at night is important to increase hotel profitability. This is especially true if you are targeting international travelers.

Change Room Rates Often

Every dollar counts. A lot of hotels make the mistake of not successively increasing their rates based on demand and supply. Don’t leave money on the table when you can be maximizing profitability.

Use Technology

Hoteliers sometimes get overwhelmed by the amount of data entry involved in managing hotel technologies. By automating the process, your staff can focus more on important things like increasing sales from local corporate accounts, social groups, corporate meetings or productions.