RevPar, distribution and revenue management. Linking the holy trinity for better performance

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To achieve maximum performance from hotels, hoteliers have to juggle numerous different aspects. By balancing RevPar, distribution, and revenue management, hotels can reach their potential. It’s no simple task but there is an aspect that influences all three critical areas; reviews.

It’s become the norm to research and seek out reviews whenever consumers are investing in a big purchase. And it’s no different in the travel industry. With travellers parting with their disposable income to stay at your hotel it should come as no surprise that they’re likely to use a search engine, OTA, or review sites to find out what your previous guests have been saying. It’s a growing trend that has a direct impact on your RevPar, distribution and hotel revenue management.

Leading review site, TripAdvisor has amassed over 500 million reviews on its platform, demonstrating just how important it’s become for travellers to research. Research has shown that reading reviews is a task that most travellers undertake before making a reservation, with more than eight in ten stating it helps them feel more confident in their decision. Some 98% also state that they’ve found the reviews are an accurate reflection of the experience they have, placing it above other areas where travellers can source information, such as directly on your website.

Whether travellers choose to book directly or through one of your other hotel distribution channels, reviews are one area that remain important. Interestingly, having no reviews at all has a negative effect too, with half of travellers signalling they wouldn’t make a booking if they couldn’t read real life experiences. As a result, reviews, building trust and developing online reputation is essential.

RevPar

It goes without saying that the more positive reviews your hotel receives, the greater the RevPar you can achieve. Consumers trust review sites to give them information that they can rely on. If you’re receiving consistently positive reviews that highlight your facilities, level of services and value, you’ll be able to increase revenue per room. It gives you an edge over competitors in increasingly tough market conditions, allowing you to maximise revenue potential.

RevPar, distribution and revenue management

Distribution

Your hotel distribution channels have a big impact on performance. Researching hotels is a common theme among all travellers, no matter which channel they plan to make a booking through. With leading OTAs now operating their own review network and linking to trusted sites, such as TripAdvisor, reviews are a crucial element for improving outcomes across your distribution network. It allows you to optimise each channel, converting as many of those browsing to paying customers as possible.

Revenue management

As in any consumer sector, consumer perception has a huge impact on revenue in the hospitality industry. As part of your revenue management, working to improve reviews allows you to boost sales in other areas. Cultivating a trustworthy image that’s proven to add value not only will convert more leads but means guests are more likely to purchase optional extras and upgrades, particularly if they’ve been highly recommended among leading platforms.

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