A Closer Look at Hospitality Revenue Management and Internet Marketing

There is no double that hotel revenue management and internet marketing is fast coming together. At the Hospitality Sales and Marketing Association International (HSMAI) convention in Anaheim, California, the two topics were extensively discussed. People from both sides of the industry thought of ways to make the two disciplines complement each other to create demand in today’s turbulent economic times and beyond.

According to Eric Pearson, the senior VP of Brand Performance, Americas, Intercontinental Hotels Group, “revenue management and internet marketing professionals are the new rock stars of the hotel industry”. And indeed, it is easily apparent that the potential contribution they can give is significant.

The presentation he presented showed the types of benefits the hospitality industry can experience (ie. increase hotel sales, increase RevPAR, revenue optimization) if the two are used together. The strategy should be backed by concrete analysis and real time data to drive hotel profit growth even further.

Main Points of the Conference

In essence, the conference has several main points, one of which is the increased interdependence between hotel revenue management and internet marketing strategies. E-commerce, hotel pricing strategies, and revenue optimization techniques are all looked into. Right now, it was noted that forecasting the demand and knowing the buying behavior of the customer is the key to maximize hotel profits.

Meanwhile, on the breakout session “Social Media Strategies”, tips about what hoteliers can do to boost profitability were also discussed. Things like the best practices to measure ROI, identifying time and resource allocations, as well as employee policies were looked into. Attendants were advised to take advantage of the various measures available to them including marketing, sales, and other consumer information that’s readily available on social networks.

The lessons that were gleaned from the conference were very beneficial. If used wisely, it can contribute greatly to increase RevPAR and boost hotel profit.

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.

Focusing on Increasing Hotel Sales

Sales forecast is not something that most hotel revenue managers want to focus on. But this is an essential element to consider because it will affect the company’s strategy, hotel rate positioning, and pricing strategies among others. Every start of the year, most people look back at what happened the previous year. And for the new strategy to be successful, it is critical to know what worked and what didn’t in the previous years and how these can be improved upon in the next year. In addition, hotel revenue managers should not only lay out the forecast and stick to it stubbornly. It is sometimes wise to consider the current market condition to change the hotel rate strategy appropriately.

After this step, the next one is implementation. This is where more problems start to occur. Many hotel revenue managers say that they have a problem about “time management”. They take unnecessary calls that could have been left to the secretary to answer. They welcome interruptions from different people within the hotel. And they spend too much time in redesigning work flow and other systems. While this initiative may be necessary, it is the task of the hotelier to know which area should be prioritized.

In truth, most revenue managers don’t have an issue with time management; they have sufficient organizational skills to manage their time effectively. Their main concern should be their lack of focus. Focus is different from management. It is not about organization but about prioritization. The organization with streamlined operations may not experience profit optimization if it is targeting the wrong market. In the same way, managers who put their time and effort into unproductive undertaking will yield no tangible results.

Fortunately, there are things that can help hoteliers and staff keep their focus on the right things. Among the steps they can take include:

Analyzing Daily Activity – writing down the activity of the day and then analyzing it will determine how productive the hotel revenue manager is. This will help them identify which tasks needs to be eliminated and which should be placed at the top of the list.

Prioritized Identified Areas – once the critical aspects of operations have been identified, the next step is to know which proposals, contracts, or any other tasks should be done for the day.

Reduce Interruptions – one of the things that make a person less productive is distractions. By eliminating interruptions and other unnecessary tasks, the main priority can be finished during the day or during the specified timeframe.

Can Hotels Increase Sales From Business Travelers?

The economic downturn has put a damper on travel. But a potential rebound may be coming from the least expected segment: business travel. A new survey has found that the drastic cut back on corporate travel may merely be the instinctive reaction rather than a carefully laid-out strategy. Right now, there are indications that companies are realizing the benefits of traveling. In-person meetings are critical to maintain strategic relationships and in forging new alliances. It can provide a competitive advantage to companies that make an effort to meet partners despite the economic downturn.

In a recently commissioned survey conducted by APCO Insight, it was revealed that majority of companies are rethinking their initial plan to sit “on the sidelines”. The same survey showed that 72% of companies will increase their travel to build market share. In addition, 53% of those surveys believe that their companies that decrease the amount of their business travel will give their competition an advantage.

So what does this mean to hotel revenue managers? Well, it is important to realize that despite research findings, businesses are still facing a dilemma. They need to balance short-term cost cutting with long-term strategic planning. According to Kellogg Business School Professor Daniel Diermeier, “in tough times, face-to-face interaction may be more important than it was before”. That is the reason why companies need to understand the impact of travel before they adjust their policies about it.

Is Price Reduction Recommended?

For hotels, the knee-jerk reaction is to decrease their price in order to attract more travelers. Although it may work in some instances, it can also do more harm than good if it is not utilized properly. It is critical for hotels to practice hotel revenue management to determine whether or not discounting is appropriate. There are a lot of risks associated with discounting because hotels will lower their revenue and possible damage their brand positioning.

With the right yield management in place, discounting may not be necessary. RevPAR Guru is an alternative revenue management system that enables hotels to increase their sales even during tough economic conditions. Hotel revenue managers need to make use of all their resources and improve the hotel distribution strategy.

From enhancing direct marketing, introducing new technologies, and improving current loyalty programs, hotel revenue managers can effectively and efficiently improve the hotel sales strategy. Aside from this, utilizing the potential of the internet is also recommended. Majority of travelers now make reservations online. It is critical for today’s hotels to modernize their hotel rate strategy and partner with successful travel portals.