Seven trending hotel news stories that will have an impact on your hotel Revenue Strategy.
1. THE FUTURE OF REVENUE MANAGEMENT DEPENDS ON BIG DATA
The author has seen the future of the travel industry, and it is Big Data. He argues that accessing the data isn’t sufficient; rather, travel professionals—and this particularly means revenue managers—need to understand how to exploit it. His piece of advice:
- Don’t get overwhelmed by the massive amounts of data available.
- Big Data can be the key to providing personalized experiences to guests.
- Use Big Data to improve internal company processes.
- Hire, cultivate and learn how to retain data scientists on your team.
- Partner with others to maximize the effectiveness of Big Data.
2. CREATIVITY, NOT TECHNOLOGY, DRIVES REVENUE SUCCESS
Big Data and powerful technology have somewhat leveled the revenue management playing field. So according to panelists speaking at the Hotel Data Conference, success in revenue management requires creativity, passion and old-fashioned hustle.
It’s also important for RMs to be able to wear multiple hats and know as much as they can about sales and property operations beyond their own discipline. Other keys to success are the ability to communicate, a research focus on guest demographics and behaviors and a dependence on low-risk, high-reward principles.
3. REVENUE MANAGEMENT IS MUCH MORE THAN RATE SETTING
It was refreshing to hear hotel company executives extol the value and importance of revenue strategies in the overall success of hotels. That was a message from a group of hotel operators speaking at a Hotel Data Conference panel.
They said revenue managers need to be integral to all aspects of a hotels’ operation, even if they operate remotely. No longer is the revenue management department in charge of just setting rates, hoteliers at the conference agreed. Now they oversee loyalty membership data and rates, distribution and channel mix and benchmark key hotel performance metrics. To make that happen, the revenue team must sit in the middle of operations and communicate effectively with all other departments.
4. IT’S SMART TO HIRE MILLENNIALS IN ANALYTICAL ROLES
Just as a lot of myths revolve around the millennial generation as travelers, so too do these myths pertain to this group as potential hires in analytical jobs, such as hotel Revenue Strategy. The consensus among speakers at a recent panel was that most millennials have the same goals and aspirations as workers in all demographics.
Like all employees, millennial RMs want flexibility, some control over their jobs and careers and the opportunity to share their opinions. Issues arise, however, in how to retain the best of this group as many of them get lured to what are perceived to be better, sexier jobs at other companies.
5. THE IMPORTANCE OF MEASURING ANCILLARY REVENUES
According to a new report, an increasing number of hotel operators and revenue managers are making efforts to more fully measure the impact of ancillary revenues on their operations. A few years ago, food and beverage was the most measured type of ancillary revenue. Today, more RMs are measuring MICE, and room and service upgrade revenues, with 45.8% and 43.8% of respondents, respectively, tracking these categories.
The rationale is easy to explain: It is much easier to control, manage and maximize streams of revenue that can be measured. Without these measurements, GMs and financial executives have fewer benchmarks to gauge the profitability of their properties.
6. OUTLOOK BRIGHTENS FOR US HOTELS IN Q4
While U.S. hotel performance is expected to remain choppy through the third quarter, prospects brighten for the fourth quarter of the year, according to the August North American Hospitality Review from TravelClick. The forecast calls for healthy growth in both average daily rates and bookings across all travel segments during the last quarter of the year.
In the next 12 months, transient leisure business will lead the industry with bookings up 4.1%, and flat average rates. Group bookings are up 1.2% in committed room nights, and ADR is up 1.5%. The transient business segment is mixed, with bookings down 1.4%, but ADR up 1.4%.
7. THE HEARTLAND IS THE GENESIS OF MANY CONSUMER TRENDS
This is a little off-topic to Revenue Strategy, but it is a unique outlook on consumer trends that could have profound effects on hotel marketing. The author was part of a study of smaller-sized cities in the American Heartland to determine their role in creating consumer trends. He found these cities, thanks in part to the power of the Internet, are actually the starting point for many trends, which goes counter to the widely held belief that innovation and consumer attitudes start in the gateway coastal cities.
How that specifically relates to travel and hotel marketing, I’m not sure. But the lesson is to cast your resources far and wide when developing marketing programs and campaigns. The real trendsetters might be your neighbors.
Stay up on hotel Revenue Strategy news and discuss industry tech trends in the Hotel Revenue Strategy Leaders Group on LinkedIn.
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