2015 was a good year for hotels. Occupancy was up. Revenue per available room was up. But demand and rates are softening as we settle into 2016. So the need to drive revenue and revive the momentum is critical.
To do this, hoteliers must better understand how their inventory is being considered in the marketplace. This means going beyond inward- and backward-looking data to better understand unconstrained demand (not just those buying, but everyone potentially shopping).
Revenue strategists can leverage this key data set—specifically regrets (when the customer opts not to book) and denials (when the customer is told the hotel or requested room type is not available)—to help understand the future demand of a hotel and the price sensitivity of potential guests.
Three top tips:
1. Looking back isn’t enough
Forecasts are traditionally built by analyzing past bookings or current reservations. But when you start to look at unconstrained demand and web-shopping behavior, you’re introducing forward-looking data into your strategy. This can improve forecasts and influence pricing algorithms, all while providing key information that drives better operational decisions and ultimately more revenue.
2. Simply tracking data isn’t enough
Alice was on to something when she told the Cheshire cat, “If you don’t know where you are going, any road will take you there.” The same goes for web-shopping behavior: If you don’t know who you’re losing or turning away and why, how can you accurately adjust your strategy to maximize revenue and turn lookers into bookers? The more you know, the more strategic and profitable you will be.
3. There’s more where that came from
When you start to look at web-shopping data, other patterns and nuances will be revealed. For example, you’ll be able to see how many people are visiting your website at a certain time, which can help gauge the frequency of last-minute arrivals. You can also see at what prices your customers are booking, and more importantly, when they are abandoning your site. It can help you find more optimal prices to drive more revenue.
All the data you gather when you start to track web-shopping behavior can help determine if strategic revenue moves need to be implemented. It’s like having a road map to higher revenues.
About the author
Joanna DeChellis is a Contributing Editor at Duetto, a hotel revenue strategy technology company based in San Francisco. For more on tracking lost business, download Duetto’s latest whitepaper, Web Shopping Data: The Secret to Unconstrained Demand.
