Today's Revenue Management thought:-

Clear & Concise = Conversion

The manner with which hotels communicate in general & particularly on their websites can have a major impact on the perceived value and willingness to make a reservation.

In order to ensure clear and concise communication, focus should be directed on using simple language, providing detailed yet easy to understand product descriptions, and providing accurate and up-to-date information.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Ethics & pricing….. 10 key questions to ask yourself.

1. Is it ethical to set prices based on a customer’s ability to pay ?

2. Is it ethical to engage in price gouging during times of high demand ?

3. Is it ethical to offer discounts to certain customers or groups of customers ?

4. Is it ethical to have different prices for different versions of the same product ?

5. Is it ethical to use pricing as a way to manipulate demand ?

6. Is it ethical to use pricing to foster loyalty among customers ?

7. Is it ethical to use pricing to limit competition ?

8. Is it ethical to use pricing to create barriers to entry for new competitors ?

9. Is it ethical to set pricing based on perceived value rather than the cost of production ?

10. Is it ethical to use pricing to differentiate between customers?

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Customer value perception…..

Fluctuating value perception from customers can affect your ability ability to price rooms correctly.

Customers' perceptions of value can change based on their personal preferences, the market, and other factors, making it difficult for Revenue Managers to accurately gauge the value of their product or service and set an appropriate price.

Revenue Managers must therefore pay close attention to changing customer perceptions in order to ensure that their prices remain competitive and attractive to potential customers.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Someone recently ask me if you can create & retain value for your hotel with limited staffing.

Thinking out of the traditional “hotel mind set box”, the only answer is - Yes, it is possible to create value for a hotel with limited staffing.

Remaining focused & creating a welcoming and inviting atmosphere for guests, even with limited staff is essential.

Additionally, utilising technology to streamline processes, and automation of certain processes can reduce the need for manual labor and enable your property to deliver a better experience to guests.

Finally, focus on creating a memorable experience for your guests through unique experiences, such as art installations or special events. By creating a memorable experience, your hotel can create a positive lasting impression for guests, creating positive reviews and generating repeat business.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

CAC …… continued & summed

Every step of the way there is an associated cost….

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Cost of acquisition ….CAC

Unfortunately, most hotels have very little insight or interest for their CAC.

By monitoring CAC as a KPI, hotels can better understand how it varies and make smarter decisions in an attempt to steer these costs downwards.

Experimenting with different marketing strategies, changing pricing strategies, and finding more cost-effective channels to acquire customers.

Monitoring CAC also helps identify areas where cost savings can be made and highlight areas to be more efficient in the use of resources.

By not maintaining an watchful eye on CAC you will see long-term profits deteriorate over time as CAC tend to increase faster than the total revenue..

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Cost of acquisition ….

We as an industry need to reduce guest acquisition costs in order to remain competitive and profitable.

The advent of OTA’s and the increasing use of mobile booking apps, guests have more options than ever to compare prices and choose the best deal.

We need to be able to offer competitive prices and value-added incentives in order to attract and retain guests.

By reducing our guest acquisition costs, we can lower our prices and offer more attractive packages to potential customers. Reducing acquisition costs also allows us to reinvest in other areas such as automated pricing tools, marketing, product innovation and customer service.

This helps us to stay ahead of our competitors and remain competitive in the market.

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Cost of acquisition ….

Following up on yesterdays post - a number of individuals contacted me to clarify acquisition costs, as they were of the opinion that these were solely commissions.

We may be putting out that same rates on different channels, but all rates are not created equal, as there are different costs associated with each “sale”.

Commissions are one of many cost associated with acquiring a paying guest. Amongst the other costs that can be considered are:-

• Website & booking engine maintenance & subscription fees

• Advertising - some will argue that this is a marketing cost, and should not weigh on the actual incoming reservations

• GDS transaction fees

• Last Minute Discounted rate, as opposed to BAR rate

• OTAs also give you the option of spending more to get higher visibility (ex. offering membership discounts or country specific discounts) and a host of other options that can confuse you.

In addition cost of may vary from property to property & you may be paying more than your competitor down the street to acquire a reservation from a specific source, simply because that other hotel negotiated better terms. This makes comparison even more challenging.

At the end of the day, you should always have a reasonably clear view on what it costs to generate a reservation (even walk-ins).

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Monday morning blues….

Reservations have poured in, which is great news…. but when you dive in deeper and realise that the vast majority have come from OTA’s, the alarm bells start to ring. What will this cost me in commissions ?

Would your property have been better of getting these reservations directly ? More than likely will the vast majority state… but what are the true costs of acquiring a reservation directly, and would you have gotten it at all !

Do you truly manage and understand your acquisition costs ?

Have a profitable week.

✌🏼

Today's Revenue Management thought:-

Is gut feeling a better indicator than data ?

Sometimes my day is just like this……..

Have a profitable week.

✌🏼