Today's Revenue Management thought:-

Are you overlooking an essential cost metric?

Customer acquisition cost (CAC) for hotels direct reservations can range from 8% to 25% of room revenue. Yes, you did read this correctly !!

CAC includes commissions, reservation transaction costs, loyalty programs, and host of other expenses (the list is long) for labor, marketing campaigns, revenue management systems, other tech stack investments, share of PMS cost, etc., etc.

However determining the right mix of these resources in CAC spending can be complex.

The CAC mix can and will vary from property to property. Success will be achieved if you can steer your CAC to a minimum by carefully allocating resources where they have the highest return on investment.

Don't forget to keep track of this crucial metric.

Have a profitable week !

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