Superpowers Wished for in Hotel Revenue Management
The Evolution of Hotel Revenue Management
The hospitality industry has greatly progressed to adapt to today’s highly dynamic environment of increasing market competition, continuously rising costs and quickly changing demand created by guests who are getting more selective by the day. To thrive in this situation and gain more profitability, the spotlight has been directed onto Hotel Revenue Management – turning the revenue manager into team coach providing strategies in winning the game of “Who is the best?” The revenue manager has also become the central source of information to support and guide top management in making sound decisions to improve the hotel’s business month by month, and year on year.
Once upon a time, the Revenue Manager only had two tasks: manage room inventory and apply price optimization. Now, the role has expanded significantly to include other important tasks: distribution channel management, online marketing, social media and online reputation management – all of which have impact on the hotel key performance indicators (KPIs) occupancy, ADR and revenue, among others. Continuing the domino effect, these hotel KPIs are main contributors to his total hotel revenue management in order to realize his ultimate goal of achieving the maximum hotel Gross Operating Profit possible. As a result, it is necessary for the revenue manager to wear multiple hats at the same time and possess more skills to fulfill this intensified role. One may think that the revenue manager is a hotel’s resident superhero given how he juggles all these responsibilities while at the same time fights the challenges that come his way. As a revenue manager, do you secretly wish that you have the following superpowers so you could do your job well?
1. Power of Duplication
As revenue manager, you have to be a multi-functional expert doing different tasks all at the same time. Do you ever wish you could actually have 10 of you so you can collect data, create budgets and forecasts, analyze profit and loss, keep up to date with competition, set pricing strategies, work with operations, manage online presence, identify new markets, and more?
2. Foresight (Clairvoyance)
Would it not be great if you could foresee which new hotels are opening within your area to get ready for new competition, or find out if the new government would implement a tax reform… or perhaps inflation would rise at a certain time, so you could adjust your pricing? How amazing would it be to be able to create the right offers the sales team should use to increase business “on-the-books” because you could tell them a new trade fair is to take place within the city in the next 12 months?
3. Super Speed
There is an abundance of available data to process, especially lots of numbers. Unless you can read or acquire knowledge at a hyper-accelerated rate, then you are set – and then you can analyze them.
4. Time Travel
Would it not be amazing if you could actually go back in time to see what happened in the market that may have a great influence on your hotel’s performance now? Perhaps you could find yourself being in the center of a large exhibition hall that took place three years ago – seeing thousands of visitors from all over the world converging, and knowing they are the reason why all the hotels in the city are full. Would you not want to find out if a certain incident took place that has caused travelers not to come visit your city anymore?
Or the psychic ability to control electronic machinery. Technology was created to simplify life in general and to maximize the human capability. It has also reshaped the consumer behavior. Living in this technology-driven environment means we have gadgets on our fingertips almost 24/7. Gadgets, plural with an “s”, as hardly would one have only one piece of technology that they use in their daily life to fulfill all their needs – and this of course includes the revenue manager at work. Imagine if you could just talk to your different machines/systems and tell them what to do to help you in automation, integration, creating your budgets and forecasts?
The reality is, however, there are no caped revenue managers with these superpowers. The least they have is an equivalent to the Green Lantern’s ring or Thor’s hammer, and that is their one piece of go-to technology to help them with their job. Being referred here is their ever reliable, simple yet efficient revenue management software that could somewhat match the above-listed superpowers.
Features and Benefits of a “Supersoftware”
- No need for foresight or clairvoyance – if your software could allow you to view the daily booking data and their changes rolling up to 365 days in advance. You can then quickly discover lags and opportunities in your analysis such as deviations from budget and forecast, or perhaps understand why there is a huge pickup or vice versa. With these discoveries, you can be agile to quickly adjust your selling strategies and take immediate action.
- No need for super speed – if your software sifts through all the data and present you with only relevant ones as Excel-based reports – all according to your defined key figures, by segments/groups, and with variable time reference (day, month, year). It would also save you your precious time if the software could do an automatic email transmission of these reports allowing for more transparency and proactive behavior within your team.
- No need to time travel – if your software could show you historical “on-the-books” and pickup data up to 5 years ago, to give you that needed guidance to manage the present situation.
- No need for cyberpathy – if you have an efficient hotel financial planning and revenue management tool. A reliable hotel software that could easily be integrated into your existing IT environment via interfaces to various Property Management Systems (PMS), allowing automatic transfer of data, eliminating manual input and reducing sources of errors. If you also happen to be not on your desk but need key information right away, you would want something easily accessible on your mobile phone anytime, anywhere, just like the Pickup Tracking APP.
Revenue Management has come a long way in terms of the role and responsibilities of the person in charge of this important discipline in the hotel industry. With the ever-changing market landscape, the revenue manager needs to continue to gain more “superpowers” to thrive accordingly. What other features of a software can you add to the list that could help you even more?