Why is hotel revenue management important?

Never has hotel revenue management been more important in the hotel industry than right now. Let us give you our top reasons:

Price wars

Contrary to what some hoteliers think, it is not a time to go crazy on discounts. As much as people are slowly starting to plan their next trip, demand is low not because your rates are expensive, but because of external factors, independent of your rates.

Instead of discounting, maintain your current rates and add value. Provide safety antivirus kits, give free airport pickup to your clients, free massage to relax and strengthen the immune system, but don't cut your rates. You will take longer to recover.

Reduce costs

Maximizing revenue also means reducing costs. By having a clear revenue management strategy in place, not only sell your rooms at the best rate you can, but you will also be able to optimize your manpower ahead of time for periods of higher demand and avoid over-staffing during periods of lower demand.

Get the right guest

Not all the business a hotel gets is the right business. And even though trying to get as much occupancy as possible in your hotel is great, you will prefer reaching your revenue goal by charging the right rate. This way, you will obtain the right guest for your hotel.

In order to identify the right guest, revenue managers will keep an eye on all spending activities of guests and not just the room data. This means watching out for purchases on restaurant, bar and gift shops (specialty coffee bags, souvenirs, your hotel-branded products, etc.). Hence, we can use this information in order to make better decisions regarding promotions and marketing campaigns.

The reasons for having a revenue manager in your property are many, but having these three in mind will give you a head start on optimizing your hotel's direction and help you recover quicker.

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