Seven trending hotel news stories that will impact your Revenue Strategy.
1. Occupancy not the metric to focus on when growing revenue
Hotel occupancy might be cited most often when hospitality experts are trying to gauge the industry’s health, but at the property level it is not the be-all, end-all for revenue managers trying to grow the top and bottom lines.
Several revenue management professionals quoted in this article list other metrics hotels should track, along with occupancy, when formulating strategies, including: cost per occupied room, gross operating profit per available room (GOPPAR), demand (not necessarily occupancy), and ancillary revenue potential.
2. Hotels confront the paradox of personalization
Virtually every hotel has identified personalization as a major strategic goal, but the reason why few are able to succeed can be found in the most literal definition of the term: Personalization means something different to every guest and every hotel.
Hoteliers want to give every customer that sense that his or her experience was tailored to the traveler’s own preferences. While that sounds simple, it’s very complicated to achieve before, during and after the stay. That’s why a personalization strategy should involve the marketing, operations and revenue management departments working from the same set of robust data.Increasing #hotel revenue takes focus on more than just occupancy Click To Tweet
3. Travel companies at crossroads of personalization, protecting customer trust
The other side of the personalization issue, however, can be the challenge of using big data responsibly and securing that customer information to preserve trust. Many travel companies rely on data-driven insights to support an individualized customer experience, but data security is just as important to accomplish this, according to an opinion blog from Adobe.
The burden falls on travel companies to stay informed about new data security standards and to align resources for security programs, tools and personnel to monitor technology for online booking, payment compliance and storage of customer profile information.
4. GBTA survey: Putting off rate audits could cost corporate travelers
Common sense would tell any corporate-travel manager that it pays for her to check her hotel rates to ensure they match what was agreed to in contracts. But new research from the Global Business Travel Association and HRS Global Hotel Solutions has numbers to quantify just how much a foregone rate audit could cost you.
Globally, 14% of travel managers do not audit their negotiated hotel contract information — rates, amenities or other features — despite the fact that about one in six audits reveals a discrepancy between what appears in the system and what has been negotiated. More importantly, when such discrepancies are found, companies pay an average rate that is 14% higher than what was negotiated.
5. Four Seasons CEO calls Airbnb ‘meaningful force’ in the luxury space
In a departure from the hotel industry’s party line on the threat of Airbnb, Four Seasons CEO Allen Smith said hoteliers, even in the luxury segment, would be naïve to ignore the effect the sharing economy giant could have on the industry. “It’s just another example of the speed in which the market is changing and the manner in which we need to be prepared to respond to it.”
He conceded that Airbnb hosts are unlikely to match the level of service and hospitality a high-end hotel can provide — but home sharers could come close. Smith said the meaningful threats posed to hotels could be the supply of luxurious vacation rentals and the continued evolution of Airbnb as a distribution platform.
6. Marketing initiatives harder than ever to evaluate for hotels
As digital marketing and distribution continues to get harder for hotels, it becomes even more challenging for companies to evaluate their marketing initiatives and spending. Olga Nielsen, director of marketing and distribution analytics for Choice Hotels, suggests a different attribution model is needed in today’s environment to gauge brands’ return on marketing spending.
Rather than the more common “last-click attribution” model, Nielsen advocates for a multi-touch technique that assesses both digital and digital marketing approaches and statistically separates the incremental revenue value resulting from each.
7. Business travel to U.S. shows resilience, despite recent dip
Research shared from the U.S. Travel Association showed that travel volume to and within the U.S. increased slightly in April compared with a year earlier, though international inbound travel is projected to lag behind domestic growth through late 2017. Overall, the rate of growth in travel volume is decelerating, but it is expected to remain positive through the next six months.
Business travel had a rough start to 2017, starting off flat in January and showing decreases in both February and April. The association said that softness was only temporary, likely impacted by the timing of the Easter holiday, and predicted that business travel would slowly and steadily improve over the course of the year.
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Tags: acquisition costs, Adobe, Airbnb, Allen Smith, big data, business travel, Choice Hotels, cloud, cloud technology, direct bookings, Four Seasons, GBTA, Global Business Travel Association, GOPPAR, hotel demand, hotel distribution, hotel loyalty, hotel marketing, hotel occupancy, hotel personalization, Hotel Revenue Management, hotel revenue strategy, hotel technology, RevPAR, sharing economy, U.S. Travel Association