Seven trending hotel news stories that will impact your hotel Revenue Strategy.
1. HOW TO SUCCEED DESPITE SEASONAL DIPS IN DEMAND
Maximizing revenues—and more importantly, profits—during low or shoulder seasons is a key task for revenue strategists. In this story, asset management and revenue experts provide some helpful advice:
- Experiment with discount offers to find the level that optimizes demand;
- Be prudent in using discounted booking platforms to make sure you don’t win the occupancy battle at the expense of rate;
- Pay attention to how phone inquiries are handled; call centers typically produce the highest rates;
- Be sure to plan well in advance of expected seasonal shifts in demand.
2. PERSONALIZATION IS KEY TO MAKING THE SALE
Unlocking the keys to the travel path to purchase has been a vexing task for hotel revenue strategists and marketers. The secret to capturing the attention of consumers on their travel-planning journey is presenting them with offers that leaves them uninterested in visiting other hotel of third-party destinations.
Creating this kind of show stopper involves a combination of innovative website design, effective imagery, an easy-to-use and intuitive booking engine and a call to action that offers personalized experiences for each booker. Just as important is a rate strategy that presents options that, combined with other aspects of the pitch, gives the guest the sense they’re receiving maximum value for their expenditures.Preparing for seasonal dips, plus six trending #hotelnews stories that will impact your #hotel… Click To Tweet
3. THE SLOW, BUT SURE DEMISE OF CORPORATE BOOKINGS
Corporations and their travel managers are kidding themselves if they think they can turn the tide of employees booking directly instead of through corporate booking programs. Recent research from Phocuswright confirmed what we all know: Business travelers increasingly use their phones to plan and book their trips—outside their companies’ travel tools.
For revenue strategists, this trend creates challenges and opportunities. No longer can hotels count on a predictable number of roomnights booked through corporate travel platforms. On the other hand, it creates opportunities to develop rate strategies and personalized marketing programs to capture these so-called rogue bookers.
4. BRANDS, NOT OTAS ARE PUSHING ACQUISITION COSTS
The author has another viewpoint on why the cost of customer acquisition (he calls it brand channel costs) is rising significantly for hotel owners: Brands are raising their franchise fees (specifically marketing fees) to fund over-the-top campaigns to boost direct bookings.
He says while in the past 10 years, hotel chains have been gradually increasing brand channel costs (as a % of ADR) by 34% on average, online travel agency commission rates have been falling. He cites a Deutsche Bank study that showed commissions in the 20-30% range in 2007 and in the 10-13% range in 2017.
5. EFFECTIVE OTA STRATEGIES FOR CASINO HOTELS
Outside of Las Vegas and a few other gaming destinations, casino hotels have generally shied away from using online travel agencies to bolster bookings. The author says that strategy can be a mistake. He wrote, “If you look at the OTAs for what they are, develop and execute a strategy to use them correctly, and understand the costs involved, there’s definitely a time and place to work with an OTA.”
It’s important for casino hotel operators to create loyalty among OTA-generated guests by luring them into programs that encourage them to return and to book directly. As the author says, “Knowing when to list your inventory with an OTA and how to incorporate third-party demand into your loyalty strategy will help you innovate and drive profitability in the long run.”
6. THE SORRY STATE OF HOTEL APPS
The hotel industry has an app problem. A new study of 311 hotel brand apps concluded that most of them aren’t worth downloading onto a smartphone. Harsh words, but the research showed the majority of hotel apps don’t crack the list of the top travel apps in the iTunes App Store, nor have they even been updated in 2017.
According to the study, the best hotel apps do more than book a room. They’re often tied into global positioning systems (GPS), offer mobile check-in, enable phones to become room keys and let guests pick specific hotel rooms. The worst apps are those with the least functionality or those that are developed for a single hotel location or property.
7. MILLENNIALS ARE INCREASINGLY TURNING TO TRAVEL AGENTS
Intuitively I find it hard to believe, but three new research studies show “millennials have discovered the value of relying on travel agents—not just to book their trips, but also as advisors on making travel decisions, such as which hotels to stay at and which destinations to consider.” In one study, one-third of millennials say they plan to use a travel agent in the next two years; that’s twice as many as Gen Xers (17%) and Baby Boomers (18%).
Even better news is the fact that as millennials get older and make more expendable income, their desire to travel will also increase. According to one study, millennial travelers reported a 16 percentage-point increase in their intention to vacation in 2017. For Xers it’s only a three-point increase, while Boomers dropped by one percentage point.
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RELATED HOTEL REVENUE STRATEGY ARTICLES
- How Revenue Management Can Help You Prepare For Downturn
- 8 Steps To Improving Demand Forecasts
- As Demand Slows Hotels Should Get Priorities In Place Now
Latest posts by Ed Watkins, Contributing Editor (see all)
- Artificial Intelligence Is Key to Personalization - November 20, 2017
- OTA Stock Plunges Attributed to Direct-Booking Efforts - November 13, 2017
- Uncertainty Fuels Need to Rein In Acquisition Costs - November 3, 2017
Tags: 1:1 marketing, asset management, big data, boost bookings, casino OTA, corporate bookings, customer acquisition, Duetto, hotel apps, hotel distribution, hotel pricing, Hotel Revenue Management, hotel revenue strategy, hotel revenue strategy leaders group, hotel sales and marketing, hotel technology, hotel yielding, LinkedIn, millennials, Personalization, Phocuswright, RMS, seasonal demand dips, seasonal dips, seasonal hotel demand, travel agents