Author: Barbara Babauta – Corporate Director of Revenue Management
According to STR, hotel revenue management is the industry process that uses data and analytics to predict future guest behavior and demand. The objective of revenue management is to obtain a property’s maximum amount of overall possible revenue.
Because hotels have perishable inventory, we must always make sure our pricing is selling at the right price, at a rate that customers are willing to pay. Not easy, right?
Every day our team looks at not only that day’s pricing, dependable data, and reliable methodology for maximizing profitability, but historical demand to make sure we are priced competitively. We must also compare pricing to our comp set so our conclusions won’t be flawed and we over/under price our products.
The focus of revenue management is broader than yield management, but both involve forecasting and analytics. They also take into consideration the revenue that might be generated by food and beverage, gift shops, and services. While no strategy can guarantee success, a revenue manager needs to have great data and a strong sense of the market.
I cannot stress the importance of obtaining good data from all sales people, front desk, and night auditors. Every little piece of information is important – from the comments of the guests as they check-in/check-out, to the interaction of service staff, to guest comments. Using all this information combined with appropriate financial data and history will help our revenue management team make good decisions for your hotels. We are a team and the team of GM, Revenue Management, and Corporate Directors make for a powerful amount of experience and education. We are all in this together!
