Today's Revenue Management thought:-

Will we hit 100% by overbooking ?

To achieve this, you need to take into considertation in your forecast the following fluctations

• cancellations (last-minute / same day)

• stay extension

• early departures

• no-shows

Hotels will calculate based on historical trends how much they can overbook with to reach a perfect sell out - 100%

For instance a 100 room property might need to sell 106 room, to be 100% occupied on the target date.

Unfortunately, the challenge with statistics, entails that you are using trends and averages. The result can vary, meaning that at times you will fall short of the 100% target, and sometimes you will have more guests than rooms.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

SO we decide to overbook….. but what price do we sell those additional rooms at ?

The right pricing for overbooking will depend on the particular situation.

Generally, your goal of overbooking is to maximise revenue while minimising costs and customer dissatisfaction.

To achieve this, you typically should charge a premium for customers who are booking these rooms. This premium can range from a few € to hundreds of €’s, depending on the situation and the level of risk you want to take on as well as your alternatives.

Ensure that you have a clear and concise operational strategy to manage these situations. In addition that the level of overbooking is “controlled” properly.

Ultimately, the right pricing for overbooking will depend on the business's goals and the specific situation.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Overbooking - do I dare ?

The upside of an overbooking strategy is that it allows you to maximise your occupancy rates and revenue potential.

Overbooking is not essential in a revenue management strategy.

It is a tool that can be used to maximise revenue, but it can also cause significant customer service issues and damage your hotel’s reputation.

Your decision to use overbooking should be carefully considered and the risks weighed against the potential rewards.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Keep you’re eye on the ball.

Here are the revenue management trends and strategies will we expect to see developing in 2023?

1. Predictive Analytics: Predictive analytics will continue to be a key revenue management strategy, allowing hotels to anticipate customer demand, pricing and booking patterns. This will help hotels optimize their pricing and inventory management to maximize profits.

2. Automation: Automation technology will become increasingly popular in 2023, with new technologies such as AI and machine learning being used to automate pricing and inventory decisions. This will help hotels save time and resources and make more accurate decisions.

3. Real-Time Insights: Hotels will be able to access real-time insights into customer demand and pricing trends, allowing them to adjust their strategies quickly to maximize profitability.

4. Personalization: Hotels will be able to target specific customer segments and tailor their pricing and promotions to maximize revenue from these segments.

5. Data-Driven Decisions: Hotels will be able to use data-driven insights to make more informed decisions about pricing, promotions, and inventory management. This will help them increase profits while minimizing risk.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Do hotels benefit from rate disparity?

Yes, rate disparity can help hotels better manage their inventory, pricing, and distribution channels because it allows hotels to adjust prices across different channels, adjust inventory levels to suit different customer segments, and target different customer segments with different pricing strategies.

This allows you to better optimise your inventory, pricing, and distribution channels to maximize revenue.

Additionally, rate disparity can help you better understand the effectiveness of your pricing and distribution channels, as well as identify which channels are most effective for your specific customer segments.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Do consumer benefit from rate parity & should hotels care ?

Yes, consumers benefit from rate parity because it ensures that they are paying the same price for a hotel room regardless of the booking platform they use.

Hotels should care about rate parity because it helps them maintain control and pricing consistency of their rooms.

Rate parity also helps hotels better manage their inventory, pricing and distribution channels.

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Today's Revenue Management thought:-

The ethical implications of rate parity are complex.

On the one hand, it can result in fairer pricing for consumers, as the same price is available through all platforms.

On the other hand, it can limit competition and reduce incentives for businesses to offer competitive rates and services.

The ethical implications of rate parity need to be carefully weighed and considered by all parties involved.

Ultimately, the decision of whether or not to implement rate parity should be based on an assessment of the potential risks and benefits to all parties involved.

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Today's Revenue Management thought:-

A 100% rate parity strategy can prove effective in helping hotels maintain control over their prices, one can argue that it can lead to higher prices, decreased competition, and reduced customer choice.

Additionally, rate parity has been accused of creating a less competitive market, as hotels are discouraged from offering discounts to attract customers.

Some will also highlight that rate parity does not always benefit customers, as hotels may not always be able to provide the best deals when using rate parity. Furthermore, rate parity can be difficult to enforce and can create a complex pricing model that is difficult for customers to understand.

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✌🏼

Today's Revenue Management thought:-

Rate parity is generally seen as beneficial for hotels, as it helps ensure that guests receive a fair price when booking through different channels, while also allowing hotels to maintain a consistent level of profitability.

Rate disparity, on the other hand, can often lead to price discrimination in which guests who book through certain channels are charged more for the same hotel room than those who book through other channels.

This can lead to confusion and frustration among guests, and can damage the reputation of a hotel.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Hotel price dumping in hopes of stimulating sales often only leads to failure & more misery !

Hotel price dumping is not a successful pricing strategy in periods with low demand.

While this strategy can be successful during periods with high demand, it is not a successful pricing strategy in periods with low demand. This is because when there is low demand, customers are already expecting lower prices, so reducing prices further does not have a great impact on stimulating sales.

Additionally, if the price is too low, customers may be wary of the quality of the hotel and not be willing to book. This strategy can also lead to a decrease in customer loyalty as customers may wait for the next price dump and not be willing to pay regular prices.

Furthermore, it will lead to a decrease in revenue as hotels are not able to make up the difference in price with increased sales volume.

Finally, this strategy can lead to a decrease in profit margins as hotels are not able to fully recover their costs when they reduce prices.

Have a profitable week.

✌🏼