Revenue strategy is not the same as revenue management. The former refers to a plan established to grow a business’s bottom line while the latter refers to the steps required to preserve it. This difference means that a successful revenue strategy may require more work up front, but, when approached correctly, has the potential to deliver much greater rewards. Exactly how hotels can increase their revenue varies depending on each individual hotel’s target market, but by applying these four tactics, hoteliers can set themselves up for some exciting returns in 2018.
Improve Your Outreach Efforts
The right communication delivered to the right person at the right time can drive a lot of bookings. However, in order to correctly calibrate that communication, a hotel needs to have insightful data on those they are targeting. For instance, knowing where a potential guest is located and what kind of device they are using says a lot about how they will interact with your hotel. Looking over their booking history and participation in loyalty programs will also reveal important details about their preferences. Finally, knowing what approaches have been the most successful in the past helps hotels repeat the experience.
Tip: Collecting and analyzing as much guest data as possible can ensure that your outreach efforts are always targeted and meaningful, rather than a blind hope.
Focus on Upselling Rather than Discounting
It’s tempting to try and increase bookings by lowering room rates, but the better revenue strategy is to upsell guests instead. A survey of hotel guests showed that almost half would be willing to pay significantly more to receive improved services, like a nicer bed or VIP treatment. This approach encourages hotels to promote the value of their amenities rather than simply to focus on filling rooms. Of course, successful upselling requires a clear understanding of what guests want and need, which is where rich guest profiles come in handy.
Tip: By identifying the amenities and extras guests prefer, you can make upsales feel like personalized opportunities rather than revenue raising ploys.
Monitor Data in Real-Time
Agility is key to a successful revenue strategy. Hotels must be able to calculate room rates based on up-to-the minute considerations and then quickly and confidently make changes. Monitoring competitor rates and market conditions is important, along with tracking internal metrics related to revenue and costs. To identify exactly the right rate, a hotel will need to analyze internal and external data instantaneously.
Tip: Monitoring data in real-time is a critical first step for hotels to able to fine tune rates and other revenue sources.
Offer an Outstanding Mobile Experience
The number of guests using mobile devices to book rooms rose by 67% between 2015 and 2016 and accounted for 70% of all bookings made within 48 hours of the arrival date. It’s clear that mobile is the preferred platform for travellers making last-minute bookings, so hoteliers need to consider the mentality of this segment and cater to their preferences. Making travel feel easy and accommodating is important for these guests, especially when other properties level penalties for late bookings.
Tip: Optimizing landing pages for smartphones and tablets can hugely improve a traveller’s experience—and resulting booking rates.
A revenue strategy is fundamentally designed to deliver on guest expectations more consistently and effectively. To be successful in this endeavour, hotels need to have a granulated understanding of their individual guests. Of course, hotels must also have the organization-wide oversight to customize the guest experience without compromising the bottom line. Implementing a thorough revenue strategy is an essential step in meeting both the needs of the guest and the needs of the business.
RoomKeyPMS has developed a suite of solutions designed to enhance hotel management and the guest experience at the same time. If you’re ready to take control of the bottom line, contact our team today.
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