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:-
Forecasts are predictions about what should happen in the future based on information currently available - in an ever changing world. Forecasts are exercises of imagination - wishfull thinking - and are always questionable in their details.
Despite often being reliably incorrect, strategic value can be extracted from forecasts.
We just need to ask the right questions:
What do we believe is important and likely enough to influence a forecast ?
Macroeconomic uncertainties
Labor shortages
Spiralling energy costs
Where do we agree, and more interestingly, where do we disagree with the forecast?
Even if forecasts are based on the wrong assumptions, what do they indicate about the underlying trends ?
Identifying the hidden truths within forecasts will lead to a better understanding of the present and highlight early indicators of the future.
Have a profitable week.
✌🏼
Today's Revenue Management thought:-
It is extremely tempting to throw your hands up and say that forecasting is impossible when facing uncertainty.
However, decisions need to be made - even if it is leaving business unchanged, despite this feeling like no decision.
The key to unlocking accurate forecasting during uncertainty is to figure out what has changed, what has not changed, and what is still uncertain.
Have a profitable week.
✌🏼
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.
✌🏼