For most hotels, it would be marvellous if every day was spring or summer; that way, running a hotel wouldn’t run into the challenge of having to generate profit in ‘off-seasons’. That’s not reality, though; every hotel wherever it is in the world has to consider seasonality and their revenue and yield strategies have to be on the button to get through the whole year successfully.
But are these strategies as good as they might be? Are too many hotels looking at individual days as mere 24-hour blocks of specific seasons rather than as individual days? Would it pay off better to be cuter in terms of revenue management by doing the latter? Indeed, how can a hotelier maximise revenue throughout different times of the year? Here are some ideas…
- Optimise your IT– first off, putting in place dependable IT systems (that is, database software and analytic tools) are a must; as they enable data analysis and the identification of trends and facilitate strategic decision-making
- Price fencing – obviously a hotel likes to go out of its way to serve guests, but ensuring rates are more restrictive when it comes to discounts will maximise your revenue throughout the year; for example, only offer discounts to those guests that book ahead and don’t forget to always sell to the room type, otherwise regular guests will expect upgrades on arrival
- Analyse demographics – try to price according to the type of guest if relevant and possible by analysing your market mix and working out what each group is likely to spend; for instance, conference groups tend to be a reliably high-yielding demographic
- Channel management – each channel of your hotel business will likely provide different costs to the overall booking; obviously these prices will vary due to different factors, but by adopting a reliable hotel revenue management software system you should be able not just to manage these channels as efficiently as possible, but also to maximise revenue
- Identify all your profit centres – and revenue manage them; that means upping room rates in busy conference periods and upping breakfast prices when it’s a lot busier because it means laying on more staff
And, finally, as referred to at the outset, it pays off to approach each day as much you can as ‘a new day’; look at all the factors affecting costs and profiteering that day and manage the hotel’s revenue for that 24 hours individually.