Seven trending hotel news stories that will impact your hotel Revenue Strategy.
1. MOVING BEYOND BAR PRICING
Something’s wrong in the hotel industry when occupancies are at or near record highs yet rates seem to be barely moving upward. One issue, says the author, is an outdated approach to revenue management that relies too heavily on BAR pricing.
He advocates using updated technology and the wealth of available data to make pricing and distribution decisions that produce the optimal rates across all channels and room types.
2. SELL ROOM FEATURES, NOT ROOM CATEGORIES
The author provides an additional viewpoint on the importance of personalization in hotel marketing. As he wrote, “Today’s discerning travelers not only want individualized experiences tailored to their priorities, but they expect their hotel rooms to provide more than just a bed to sleep in. Guests want the ability to customize their stay, with price being only a secondary consideration.”
To make that happen, hotel marketers need to sell combinations of room features rather than offering broad room categories. The key is to include room features and amenities within the booking process. A booking platform that automates room assignments with the exact features and amenities their guest’s desire creates stronger customer engagement and goodwill.Maximizing rate growth amid record #hotel occupancy, plus 6 trending stories that will impact your #RevenueStrategy Click To Tweet
3. NO ONE KNOWS IF DIRECT-BOOKING SCHEMES ARE WORKING
During calls with stock analysts to discuss second-quarter earnings, public company CEOs were mostly mute on whether or not their highly touted campaigns to increase direct bookings have been successful. Worst-case scenario: A REIT CEO said his company’s hotels have seen a modest 3% shift of bookings away from online travel agencies into direct platforms.
On the other aide of the coin, the Extended Stay America CEO was giddy in his explanation of how the company’s properties rely on OTAs to attract leisure business. He said reservations from OTAs represent a little more than 20% of the company’s overall bookings, with business from this channel growing at double-digit rates for three years.
4. PRICE GOUGING IS IMMORAL AND INHOSPITABLE
It’s hurricane season, and that often means thousands of displaced people looking to flee oncoming storms. They often seek refuge in hotels, and while they understand the rationale for higher prices in times of high demand (it’s called revenue management), they shouldn’t have to expect rate gouging, as is seen every time a natural disaster creates a rush of hotel demand.
While events like Super Bowls and solar eclipses allow hoteliers to ethically boost rates two, three or more times above rack, they’re catering to people who willingly choose (and have the means) to pay highly inflated rates. Not so much for the typical family of four getting out of town ahead of winds and rain.
5. BIG DIFFERENCES BETWEEN MEN/WOMEN WEB BOOKERS
Nowhere is the difference between sexes more pronounced than in the world of online hotel booking. According to new research, women are much more active participants in online hotel search, but men are more likely to book a room when they’re visiting sites.
While 69% of visitors to hotel websites are women, men convert 1.5 times more often on their visits than women, though they contribute less revenue and fewer transactions overall. Demographics also matter: Those between 25-34 years old make up the largest share of hotel website visitors (28.8%), but those aged between 45-54 and those over 65 convert more often.
6. HOTELTONIGHT TO OFFER ADVANCED BOOKINGS
In a major departure from its original concept — providing a way for hotels to unload last-minute inventory — HotelTonight will soon offer advanced bookings up to 100 days before arrival. Whether the platform can compete with the big dogs in online travel — Expedia, Inc. and Priceline Group — is a major question.
Part of the issue is size and scope: HotelTongiht currently has 25,000 hotel listings, while Booking.com (a Priceline site) has 1.2 million listings. Some analysts believe HotelTonight’s better mobile services might give it a chance for success. Its app lets users book a room in 10 seconds, and each search turns up just 15 hotel suggestions tailored to the user’s specific needs and tastes.
7. MOTEL 6 USES TECHNOLOGY TO BOOST MOBILE BOOKINGS
With more than half of its bookings occurring on day of arrival, Motel 6 knew it needs a robust mobile offering. To make that happen, the chain upgraded its technology to cut down the number of steps it takes to make a reservation from five to three and added a flexible-date option and implemented a geolocation function that displays all Motel 6 locations within a user’s proximity.
As a result, the chain was able to increase its mobile conversion rate from 3.2% to almost 7%. And by placing call-to-book buttons more prominently on its mobile site, the chain was able to increase call volume by 20%.
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Tags: ADR, Average Daily Rate, BAR pricing, Best Available Rate, Booking.com, direct-booking, expedia, Extended Stay America, hotel distribution, hotel marketing, hotel occupancy, Hotel Revenue Management, hotel revenue strategy, hotel technology, HotelTonight, mobile booking, Motel 6, Online Travel Agency, OTA, Personalization, price gouging, Priceline, rack rate, rate growth, solar eclipse, Super Bowl