Considering adopting a revenue management system (RMS) for your hotel business?
NB: This is an article from Duetto
Keep on top of what’s happening in the market with our future predictions for 2022-2023 and the trends that we think will shape the RMS landscape in the year ahead.
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An RMS, working with other pieces of the tech stack puzzle, is designed to do just that. Guest-centric revenue management, with buzzwords today like ABS (attribute-based selling) or customer lifetime value pricing, are not new concepts.
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For example, rate management tools contain pre-arrival upsell capabilities and hence are closely tied together with the RMS with real-time integration imperative to provide commercial teams with direct access into the rates and availability database. Pre-arrival room upgrades and add-on offers are designed to maximize revenue by incorporating the sales process into the guest arrival experience. By using predictive analytics to better understand our guests’ buying preferences, we can tailor an offer that will increase their likelihood to buy and thus maximize revenue.
Connected Commercial Strategy
Revenue management is moving toward integration, not separation of disciplines, and it is demanding greater breadth and depth in the background and capabilities of its leaders and systems. Over the past decade, revenue management evolved into revenue strategy and over the past couple of years, it further evolved into commercial strategy. Commercial strategy teams were formed out of necessity during the pandemic, primarily as a downsizing exercise. But a positive outcome is that this forced revenue management teams to explore better ways of collaborating with traditional sales and marketing colleagues. Now, most hospitality companies have combined these disciplines on the org chart, as well as implementing integrated system workflows.
Total Asset Optimization
Today, the hospitality industry is increasingly focused on total asset optimization – merging principles of the two disciplines into one to reach the next level of driving sustainable growth. Total asset optimization breaks down these often-siloed disciplines so they have access to the same data, are aligned on goals, and are ultimately collaboratively focused on profitability. The revenue manager’s role in influencing RevPAR impacts the entire asset lifecycle for a property beginning with the preparation of the feasibility business case for developing/converting it and ending with the final disposal. This focus on the owner journey roadmap will ensure revenue management technology involvement from new construction or conversion to divestiture or asset exit strategy, reducing or even eliminating spreadsheet utilization for asset value optimization.
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