Revenue management is so versatile that you can apply it on a no-tech, low-tech, and high-tech environment as described by Robert Cross in Hard-core Tactics for Market Domination 1.
The hotel industry is definitely a high-tech environment. Keen observations and pure human intuition alone will not be enough to fully optimize its effectiveness. To be able to apply the proper revenue management culture you need to have access on all types of data to support you in all your strategies. You need to properly analyze these data to help you create tactics that will boost your revenue, and maintain it.
If the hotel has a Central Reservation System (or CRS), the data that it holds is only limited to the channels they are providing you. This system can give you data about your GDS performance, IBE production, and even call center reports. It can be a good source of data but it is not complete. Having a Property Management System (or PMS) that stores all the hotel data is still not enough. You need to make sense of all the available data, and not all PMSs are well-equipped in providing you the proper reports, and most of the time involves additional fees for every type of report request that you put through.
Most hotels believe that like a revenue manager position, a business intelligence tool will just be an added expense, and entails too much cost to sustain. I had a hotel consultancy project that requested for a full audit of their systems (PMS and CRS) and all their booking channels. I analyzed every piece of information I was able to gather via their PMS. There was hardly enough data since a lot of the reports that I needed were not configured in their system, and I was informed that they would need to pay additional fees. The hotel was ready to pay these additional fees, but it would cost them a lot to pay extra for each slightly different report. Another hotel I worked with did have a business intelligence tool but it was so complicated that barely anyone was able to use it!
Having a proper and user friendly business intelligence tool is worth all the investment as this system can tremendously help your hotel in finding the right strategy that will yield you great revenue.
Business intelligence tools provide you with ready-made reports that are frequently used in the industry. The good thing about these tools is that you can customize the reports that you would want to retrieve without any additional costs. You can analyze your data however you want, and you can combine different parameters that you think will help you in achieving the dashboard of your choice. It can help you effectively evaluate if you have the right market segments and how each is performing on specific booking channels. It can also show you if you are effectively pricing your segments. It can reveal if the promotion that you set up is aptly giving you the right revenue yield. These are just some of the benefits that a business intelligence tool can offer to your hotel. I strongly believe that the return on investment with these tools is so immense that you would think hotels are crazy not to implement it on their property.
About the author
Rochelle Castillejos is the Managing Director & Founder Hotel Revenue Plus. She has over 15 years of industry experience in the fields of Sales and Marketing, Revenue Management, RFPs (Request for Proposals), IBEs (Internet Booking Engines), CRSs (Central Reservations Systems), PMSs (Property Management Systems), RMSs (Revenue Management Systems), OTAs (Online Travel Agencies), and GDSs (Global Distribution System). She oversaw around 55 hotels in the regions of Americas, Europe, Mediterranean, Asia Pacific and Middle East throughout her career.
- Robert G. Cross, Revenue Management: Hard-core Tactics for Market Domination, p 63-69. ?
