Google City Tours: How Will It Impact Hotels

Technology giant Google has recently released their latest lab project called the “City Tours”. Their foray into the travel industry was launched relatively silently compared to their other ventures. Nevertheless, being Google, this development will inevitably have a very big impact on hospitality revenue management and the industry as a whole. There are many implications related to this application.

It is crucial not to forget that Google is a powerhouse in anything internet-related. If it so desires, it can release any travel application with various functionalities. And if it makes the decision to create a travel portal, it may very well kill its competition. The company could have developed a hotel comparison software, a search engine for airline flights around the world, or even a review aggregation tool. Instead, Google decided to concentrate on local attractions using the Google Maps API.

The Google City Tours is good news for everyone in the hotel industry from the hotel revenue manager to the yield management staff. On the part of Google itself, their strategy is a good move. It is related to their thrust to provide tools and features that will supplement their current application. For example, the Google Local Search as well as their business database from partners will help travelers get suggested itineraries anywhere in the world.

Using the interface is very easy as well. Though the features are currently limited, its potential is immense. Every hotel revenue management teams from the US to Asia should know how to utilize this application as soon as possible. Tourism will be influenced greatly by the colossal amount of data that points to this index. Once it is integrated into mobile devices, hotels and other hospitality organizations that are included here will experience increase RevPAR, an increase in hotel sales, and optimal profits.

How to Implement Yield Management Strategy at the Front Desk

In today’s highly modern environment, it might be tempting to focus on new hotel distribution channels such as popular travel portals and agency partnerships but there is an important segment that hotel revenue managers need to focus on as well: walk-in clients. Though this market may not be as big as the number of consumers you will receive from the internet and elsewhere, it presents great opportunities for the hotel. Walk-in consumers are usually those who had experienced the hotel’s service in the past, were referred by their friends, or simply received the hotel’s value proposition.

The front desk staff, in this instance, will assume that the walk-in client is a booking client but this is sometimes not the case. This is because they might be put off for some reason whether it is the high rates being charged to them or the “curb appeal” of the hotel does not suit their preferences. Whatever the case, there are techniques that will help improve hotel sales and boost profitability from this market:

Connect with Clients – it cannot be stressed enough that establishments in the hospitality industry, particularly hotels, should focus on service. The front desk staff and everyone in the front line should be trained to meet the needs of the clients whether during the peak or off-peak season to optimize hotel profit. Employees need to establish eye content, smile, and greet guests before they are greeted.

Offer Alternatives – depending on the availability of hotel rooms, which can use established using the inventory software, hotel revenue managers can offer two or more choices to the guest. For example, instead of quoting the highest rates, options should be given upon the guest’s inquiry. Some alternatives can include room vs. suite, view vs. non-view, and standard vs. deluxe among others. Doing this helps changes the question on the client’s mind from “should I book here?” to “what room should I get?”

Describe the Hotel’s Offering Properly – instead of directly using terms like “deluxe rooms” and “continental breakfast”, it might be a good idea to fully describe what these services entail. Put yourself in the guest’s shoes and talk in the kind of language they would appreciate. This is hotel revenue management at its best.

Hotel Profits to Increase - Goldman Sachs

While everything in the hotel industry seem kind of grim these days, an analyst at Goldman Sachs thinks otherwise. Steven Kent said that investors should be buying hotels shares already because it presents a huge opportunity in terms of future earnings. As expected though, market sentiment to his perspective was lukewarm. He further added that the “economy is not too hot” that’s why expense control remain present. On the other hand, it also is “not too cold” that’s why travel purposes are loosening up.

So what does this announcement mean for hotel revenue managers? Well, as supply contracts, it will group to a halt over the short term. In the next few years, room rates can drastically increase because of shortage and asset values will start to go up. Another factor Kent points out is the revenue per available room. Though everyone certainly wants to increase RevPAR, it is also a good indication that this key measure didn’t turn negative until the second part of 2008 even as other industries suffered.

Hotel Revenue Management Techniques for Today

While waiting for the market to get better, there are many yield management strategies that can be implemented to increase hotel profitability. This is because while the future holds a lot of potential, today’s market conditions are still undeniably challenging. Maximizing RevPAR entails getting a pricing software, inventory software, and hotel revenue management software that can predict market behavior accurately. That way, the hotel revenue management can know when to increase their prices and when to give discounts to customers.

RevPAR Guru offers the kind of technology necessary to survive and even thrive in the best or worst economic conditions. With its seamless integration of various features, it can accurately keep tract of hotel inventory and predict how much should be charged during particular seasons to boost hotel profitability.

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.

Online Hotel Sales Revenue Management

It is no secret that hotels are now deriving a significant part of their revenue from internet sales, either it is from electronic distribution channels (GDS), franchise websites, or even the hotel’s own home page. For this reason, many hoteliers are concentrating their efforts online. Right now, many have already re-allocated their resources from traditional channels to internet marketing and promotions with the objective of manipulating their internet presence to increase hotel sales.

Hotel revenue managers are certainly correct in this initiative. After all, the internet presents a lot of growth opportunities for hotels that are struggling in today’s tough times. In addition, they can expect their yield management to be improved and increase hotel sales.

Frustrated hoteliers should remember the saying that if you “keep on doing what you have always done, you will continue to get what you have always gotten.” In the business environment today, this means diminishing hotel revenue unless they do something about it. The internet should be utilized as an effective tool to drive hotel sales. Before embarking on this initiative though, hoteliers must realize that it is important to include the sales department because the this revenue management strategy will ensure that the product positioning will be uniform across all hotel distribution channels.

The three main stages that hotels can take include:

• Target Market Positioning – this strategy mainly involves locating new markets when the existing customers are generating less revenue. Hoteliers make the decision to concentrate on markets that used to be ignored. The new market can be composed of affinity groups or even the government.

• Market Penetration Strategy – as its name implies, this means deciding on which method will penetrate the market best. In this stage, it is critical to know the “depth” of the market to ascertain its potential and boost profitability.

• Initial Approach – this third approach entails actually approaching the market. There are two ways to conduct this: traditional and cyber. Obviously, the approach implemented in the two channels should be different. For example, in the internet, the first contact may come from travel portals or third parties while in traditional marketing; it might come from travel agencies.

The three stages outlined above is only a brief overview of what hotel revenue managers and their sales department can do to reach new markets on the internet. However, while the online marketplace presents vast opportunities, it is also quite important for hotels to keep their current clients and maintain the level of relationships they always had.

People Behind the Revenue Management System

An effective hotel revenue management system is the key driver behind the hospitality industry’s ability to survive the economic crisis, retain and attract customers, and increase RevPAR. And the importance of revenue management has never been more important than now. Since the market is expected to decline overall, the average RevPAR and other hotel metrics will expectedly experience a downtrend as well. With a good system in place though, a hotel revenue manager can look past this into the real potential of his hotel.

Getting a deeper understanding of the hotel clients is crucial in this stage. For example, in a normal urban/suburban transient property for corporate executives, price sensitivity is lower because they are not the ones paying the bill. Even if the corporation is managing the cost of travel, the reality is that travelers will still prefer prime locations, complete facilities, and other amenities.

Another factor that should be considered is the bookings from hotel electronic sources. Because of the popularity of the internet, electronic hotel sales have been steadily increasing for the past decade. Hotel sales channels such as e-commerce, franchise web sites, and GDS systems should be looked into carefully. Usually, the hotel sales derived from these mediums come from leisure travelers who are looking for good deals.

It is important to measure the potential of each contract. This will enable both the hotel revenue manager as well as the sales staff determine how the business can be aligned in relation to their client profiles. But more than that, all the people involved in the hotel revenue management strategy should really believe that it is effective in order to execute it property and boost profitability.

If the people who are behind the yield management strategy and hotel software don’t believe in its capability, it will reflect on their performance. Remember that no matter how sophisticated inventory software, yield management software, or hotel software is; ultimately it is still people who use these tools. Unless it is utilized to increase RevPAR and increase hotel profitability, it will just be another tool that can be effective or ineffective in the decision-making process.

Improve Hotel Revenue Management During the Tough Times

There is a saying that a “rising tide floats all boats”. In the hospitality industry, it just means that when the market is doing well, there is a good chance that your hotel will do good as well. The problem starts when the market is doing badly. As all hotel revenue managers probably already know, today’s situation is unique than ever before. Travelling has become a popular activity until the recent economic crisis. And the result is that there are so many rooms and inventory from various hotel establishments. Some have no choice but to drastically lower their prices just to generate hotel sales.

If you have previously already discovering that going with the tide is not something you want for your hotel, then good for you. Your hotel revenue management system can probably withstand different conditions in the market. However, if you’ve been left behind because you have become too comfortable in the few years past, then all is not lost. You can still increase hotel sales and boost profitability by looking over these targeted areas:

• Hotel Rate Positioning – first and foremost, decide on the hotel rate structure. It is important to look at your market position as well as your competitive set. Where are you located and when is your peak season? Knowing who your clients are and what they can afford is critical in determining the hotel rate positioning.

• Revenue Management System – if you don’t have a hotel revenue management strategy in place already, it is critical to design one. Whether you are running a chain of inns or a 900-room resort, having a good system in place ensures that you generate the best hotel room rates based on facts. The revenue management system should encompass the booking software, inventory software, and historical data for more accurate results.

• Property Management Software – every hotel has certain reports and data that are used for management. The hotel revenue manager probably knows all about this and decides on the yield management strategy of the properly. However, the hotel staff should also know the system well. After they know the basic, additional training should be given to maximize the potential of the property management software.

There are other aspects that should be looked into in order to come up with the best overall strategy for the hotel. While looking through this endeavor, checking how the hotel is performing when it comes to hotel online sales is also important because majority of sales is expected to come from the internet for most hotels.

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.

Simple Ways to Increase Hotel Internet Sales Part 1

A decade ago, hotel revenue managers would never have thought that the internet will become the most important hotel distribution channel worldwide. In 2008, 37 to 38 percent of all hotel bookings are believed to have come from the internet. Aside from this, at least another third of hotel sales are influenced by online mediums although the actual reservation is done offline. For example, bookings done through walk-ins, call centers, and travel agencies are influenced, by a large part, by what people see and read online. It is not surprising then that certain hotels were able to cope with the tough times and even increase their hotel internet sales despite the tough times.

Creating and Updating Hotel Websites

Hotel internet marketing revolves around the main hotel website. It should be the first thing that a hotel revenue manager focuses on. In many cases, it is either the first contact or the last contact a company makes with the customer. It is important that the hotel’s website be a top priority especially since the market for hotel online sales is huge. The main objective would be to create an appealing overall image of the amenities.

A lot of hoteliers make the mistake of becoming contented with the same website they had five years ago. Time has changed drastically since then. Now, it is essential to have striking graphic design, internet hotel reservation software, real time information on prices, and booking software among others. If promoted properly, this can be a significant amount of business to the establishment.

Search Engine Optimization

Every person who has tried their hand in online promotions knows the importance of search engines. Majority of web traffic will come from search engines because this is the first tool people look into when trying to find information, product, or services on the internet. By SEO, it doesn’t mean that using popular key phrases on the content is enough.

Instead, a full-fledged campaign that involves link building, search engine submissions, and content optimization should be used. This is the best way to increase internet sales for your hotel. If you decide to hire a SEO specialist or an agency for this campaign, make sure you get those who have actual experience and knowledge about hotel revenue management.

The problem with most SEO companies in the market is that they have the tendency to focus merely on increasing traffic with no regards to its relevancy to the hotel. The result is low conversion rate and a lot of wasted money. Looking for someone with hotel industry knowledge is important.

Measuring Weekly Hotel Performance

It is no secret that the hospitality industry has been struggling in different fronts ever since the global economic crisis occurred. To get an accurate overview of the condition in the United States today, performance measurements for the week March 15-21 has been conducted. Metrics per month and per quarter are very helpful in determining financial performance, but this weekly year-on-year comparison provides a better overview of the real effects of the tough times.

Using this measurement, all three key measurements declined according to the STR. The occupancy rate fell by 4.7 percent, average daily rate declined 8.0 percent, and revenue per available room dropped to 12.3 percent this week. The average daily rate is now pegged at US$99092 while RevPAR is at $US58.45. If this is not alarming already, all major cities except for Washington DC showed declining performance during this timeframe.

Washington, DC was the only market that increased on its key performance measurements. However, even that increase is on the low side of the scale. Occupancy was 69 percent which is 1.7 percent. Meanwhile ADR was pegged at US$152.91 which is up 0.9 percent. And the RevPAR of the city increased to US$105.46 which is up 2.6 percent from last year.

Seeing that the United States is a very diverse market, its remaining top 25 cities showed mixed rates. For example, St. Louis, Illinois showed an increase in occupancy while Houston, Texas declined by 1.3 percent. One notable decrease is that from New York, New York. It dropped 25.5 percent in its ADR which is the largest in the research. The city also posted the largest RevPAR decrease because it dropped 36.6 percent to only US$151.05.

Given these severe setbacks in the hospitality industry, hotel revenue managers might wonder, is there still hope in increasing hotel sales in the next few months? The truth is, the condition today is one of the worst in history. In fact, economic performance has not been this bad since the Great Depression.

Yet, it is important to realize that the conditions from the previous eras are far different from the conditions today. Now, it is possible to use inventory software, hotel revenue management software, and internet marketing to reach a larger audience: a worldwide audience. With this fact in mind, the answer is yes. It is possible to increase RevPAR and boost hotel sales even during difficult economic times.

Increase Hotel Sales by Using RevPAR Guru

Despite the amount of sophisticated technology available today, a lot of hotels are still suffering from manual processing, and poor information flow. They fail to get updated and real-time information about guest, inventory levels, and industry data. This leads to reduced revenue and has a severe impact on hotel profitability. In today’s economic condition when the industry is struggling just to break-even, it is critical to utilize all available tools to improve RevPAR and boost hotel sales.

Among some of the most common mistake that a hotel revenue managers can make include focusing too much on administrative processes instead of sales, unreliable information flow among hotel distribution channels, lack of leads about sales statistics, redundant systems and infrastructure, and inflexible systems that cannot support new hotel rate strategies and new technologies.

Requirements of Hotel Revenue Management Software

• User-friendly interface
• Real time inventory information
• Modular structure
• Integrated technology elements including channel management, revenue management, account management, business management, and contact management
• Solid technology platform
• Data accuracy

These elements are very useful in when it comes to hotel management. It helps streamline processes, improve efficiency, and most importantly, increase hotel revenue.

RevPAR Guru: Solving your Problems in Real Time

With all these challenges, it is a good thing that a software application such as the RevPAR Guru exists to help hoteliers. It is a revenue management software, hotel booking software, and hotel management systems software combined into one. It is quick and easy to implement. With the right utilization, it can show a significant improvement on hotel sales.

It is critical to choose an application that has been specifically designed for hotel revenue management. There are many software solutions available but only a few of them can actually meet the unique needs of a hospitality business. It is true that certain technologies can be “modified” to adapt to the hotel’s requirements. However, it is very expensive and in some cases, it is not flexible enough to meet ongoing improvements. The RevPAR Guru is different because it understands all the challenges of the business. All functions are designed to deliver effective yield management and profit optimization.

It is not surprising that a lot of hotel revenue managers are turning to RevPAR Guru to help them cope with the changing times. The software application is very useful in both good economic conditions and bad.

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.

Revenue Maximization with RevPAR Guru

According to the Chief Marketing Officer (CMO) Council, cutbacks and anxiety are the two primary factors that affect the hospitality industry’s marketing budget. Despite the economic downturn, it is expected that hotel revenue managers will still set aside a reasonable amount of budget for marketing initiatives. The main difference is that expenses will be more tightly controlled and monitored. Hotels are now mainly focused on hospitality revenue management, hotel yield, and profit optimization.

Revenue enhancement can occur with the right enterprise solution, sales force automation, and effective distribution management tools. About half of the hotel revenue managers surveyed said that their budget will either stay the same or experience increases this 2009. One-third expected only a slight increase while 8.2 percent expected an increase of more than 10 percent. Signs of retrenchment are evident but overall, hoteliers are committed to their employees.

Investments are being made in retraining existing employees to become familiar with rate positioning software, web sites management, booking engine, forecasting software, inventory software, and other types of hospitality technology. In this digital age where the main goal of most businesses is profit optimization, harvesting greater efficiencies in hotel electronic sales will likely be rewarded.

Donovan Neale-May, the Executive Director of CMO, has said that “Marketers are not running scared from the economy”. On the other hand, they are actually paying closer attention to the needs of their customers in order to react to the changes in the hospitality market. The solution lies in creating internal efficiencies, having better customer insights, and integrating the system with sales in order to achieve profit optimization. Hoteliers need to realize that boosting hotel sales requires better go-to-market efficiencies though controls and analysis.

It is likewise important to look into the effectiveness of digital media. A lot of hotel revenue managers are interested in increasing their online bookings through the use of proven social media strategies. But they should recognize that digital marketing is continually evolving. The hotel industry needs to evolve with it. Together with social media marketing, using real-time software solutions such as RevPAR Guru is also critical. It enables hotel revenue managers to have a detailed operational management system, track inventory, and update prices according to market demand.

When it comes to technology, the hospitality industry should not be left behind. As it stands right now, a lot of hotels are struggling to catch up with market and technological changes. By getting a software application such as RevPAR Guru, market demand can easily be met with the appropriate supply.