Insights & Strategies for Independent Hoteliers.
Today’s Revenue Management Thought - ran for 4 years
Now I publish Monday Revenue Rethink each Monday
5 Revenue Management Mistakes
Costing You Money
Dynamic Pricing Myths
Holding Your Hotel Back
How to Compete with OTAs
Without Losing Margin
The Power of a
Balanced Channel Mix
Today's Revenue Management thought:-
What does it take to come out ahead when facing uncertainty?
Uncertainty is born from a cocktail of global disruptions: geopolitical tensions, supply chain bottlenecks, talent challenges, climate change, and more. Soaring inflation, rising interest rates, and the potential for recession are only making matters worse.
Ensuring that your pricing & revenue strategies, as well as forecasts are in place are of absolute priority.
One of the few business certainties right now is that we can’t wait for clarity. The time to act is now.
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
Strategic planning is often neither “strategic” nor much of a “plan”. It usually resembles risk aversion more than clear marching orders for an organisation.
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
Strategy plans can be viewed as “clean”, but implementation often fails to meet its full potential since crucial ingredients for success are often lacking or overseen.
Here are a number of key success factors to implement your pricing strategy successfully.
Make price strategy a top management priority
Set an ambitious pricing roadmap
Select an experienced revenue manager to steer
Implement the new price structure in relevant systems to ensure automation
Define clear responsibilities between different functions and departments
Train your sales staff
Define KPI’s, monitor results, and steer accordingly
Communicate early results within the organization
Start small and aim for continuous improvement
Remember - a price implementation project is a marathon, not a sprint (with almost immediate results).
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
No other lever has more impact on profitability than pricing. But quite often, pricing strategies are historically grown, based on gut feeling, or too traditional.
Implementing pricing strategies are complex and not always clear-cut projects.
One should therefore approach a price implementation project as a marathon, not a sprint.
In order to have significant impact on the results, preparation is key for a successful implementation.
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
Determining which revenue strategy to pursue is often the most difficult part when planning. The sea of empty space that stares back from a blank whiteboard can deafen strategic brainstorming attempts with its silence.
Knowing which questions to ask and variables to adress is the most effective way to approach the subject of strategic revenue planning. Questions like,
Which sales and marketing opportunities are available to us immediately ?
Are the right people in place to execute our short-term and long-term goals ?
Do we have the necessary technology available ?
...can get the conversation started.
Once the discussion is underway, this will offer you a starting point for a revenue strategy.
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
"We believe we will achieve our revenue and profit goals over the next 12 months with our current resources.”
This statement is one often heard when budget’s have been approved. Is this a true statement or one made to please owners, investors, financing institutions, and how do we ensure that these goals are met.
A proper revenue strategy aligns marketing, sales, and customer experience teams around a singular goal: drive profitability.
Unraveling such the puzzle requires a strategic revenue roadmap to achieve healthy and sustained growth.
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
Hmmmmm…….is always a good initial thought.
In the coming weeks we will many forecasts and budgets being presented. We all know that a lot of blood sweat and thought have gone into producing them.
Mo matter what - there will always be discussion.
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
Most of us are pretty bad at predicting anything longterm.
The shorter the time span and the greater the impact of our own actions have on the accuracy of the prediction, the better we are at predicting.
Reflecting on this, it is not so much about how good we are at predicting, but more so, what are the benefits we will receive when we are right about the predictions, and what type of harm they can cause to us, when we are wrong.
So it does it matter if your prediction does not come true in the first ten tries and you lose €100 each time, if on the eleventh prediction you get it right and you make €10,000.
Zoom out enough to be able to make the right predictions.
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
One of the most insightful lessons I've learned from engaging in any challenge is viewing results in terms of "expected value".
This has guided my focus to be more process oriented and to take the long view on goals, which has led to better outcomes over time.
In probability theory, the expected value (also called expectation, mathematical expectation, mean, or average) is a generalisation of the weighted average. With other words, the expected value is the arithmetic mean of a large number of independently selected outcomes of a random variable.
When processing & planning your budgets & forecasts - do you calculate “expected value” ?
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
Budget time is here…..
You can't prepare for what you can't see coming….
Demand forecasting has been stuck looking backwards for too long.
Building strategies on last year’s or 2019’s results is meaningless, and predicting the evolving future and the external factors driving demand is extremely challenging. Yet profitability depends on being able to accurately build forecasting models that make use of both internal and external data.
The need for predictability is not necessarily a need for guarantees…. and now back to those budgets.
Have a profitable week.
✌🏼