Use Revenue Management to Boost Profit at your Independent Hotel
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Transcript of Use Revenue Management to Boost Profit at your Independent Hotel
Use Revenue Management to Boost Profit at your Independent Hotel
November 24, 2015
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Founded byIndustry Leaders
World-ClassTechnology Development
Committed toCustomer Success
@OptimizeDemand
About Duetto
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Founded byIndustry Leaders
World-ClassTechnology Development
Committed toCustomer Success
New Partnership
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Founded byIndustry Leaders
World-ClassTechnology Development
Committed toCustomer Success
Dan YackerVP, Global Strategic Alliances
Duetto delivers cloud-based revenue strategy to hotels, allowing them to maximize profits through actionable data to better manage pricing, revenue and business mix decisions.
Past Experience:
Agenda
▍Learn the basics of revenue management
▍Common pricing mistakes to avoid
▍Use Open Pricing to better manage distribution
▍Automate functions with alerts and price rules
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Revenue Management Introduction
The primary aim of Revenue Management is selling the right product to the right customer at the right time for the right price — and on the right channel.
Inventory /Capacity Demand
Price
$
Do I need revenue management?The 7 mistakes you can’t afford to make
#1 Selling out too soon
#2 Not changing your rates
#3 Pricing by gut feel
#4 Reacting to competition price changes
#5 Selling rooms on first come first served basis
#6 Linking different price points
#7 Not adjusting pricing 24/7
What is Required to Thrive?
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How to Thrive
Start Practicing Revenue Judo
1.Redefine revenue strategies
2. Improve your forecast
3. Implement an Open Pricing strategy
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Revenue ManagementA systematic approach to segmenting, forecasting and pricing that can drive efficiency and profitability.
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5 Key Reasons to Forecast
Staffing ProductInventory
DevelopmentWork
PerformanceEvaluations
Pricing
Better Data = Better Forecasts
Reviews & Social Media
Competitor Pricing Data
Booking & Reservation Data
Web Shopping Regrets & Denials
Weather
Air Traffic
Traditional Revenue Management
Traditional Revenue Management
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One-Rate
Seasonal
Weekday/Weekend
BAR
BAR by LOS
Open Pricing
PricingApproaches
Pricing Types
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Seasonal
Pricing Types
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Seasonal
Best Available Rate (BAR)
Pricing Types
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Seasonal
Best Available Rate (BAR)BAR by LOS
Pricing Types
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Seasonal
Best Available Rate (BAR)
Open PricingBAR by LOS
Regain Control
▍Independently price every single segment, offer and room type
▍Maximize revenue over high demand and need periods
▍Keep all channels open and benefit from the “billboard effect”
BAR Pricing = Lost Opportunity
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BAR 2$200
BAR 1$100
Retail/ Transient Rate Code: BAR
15%
With BAR Pricing comes static:- Room Type Differentials- Discounts/ Offers
45% Occupancy75%
BAR 3$300
Traditional Pricing
Day 1 Day 2 Day 3 Day 4
CAPACITY
AAAPromo Rate
10%20%
✔✔
AAAPromo Rate
10%20%
✔✔
✖ AAAPromo Rate
10%20%✖
AAAPromo Rate
10%20%
✔✖
Open Pricing
Day 1 Day 2 Day 3 Day 4
CAPACITY
AAAPromo Rate
10%20%
✔✔
AAAPromo Rate
10%20%
✔✔
10%20%
5%✔ AAAPromo Rate✔ 5%
AAAPromo Rate
10%20%
✔✔ 5%10%
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How an RM system will impact your job
Review and Monitor AlertsReviewing Revenue Opportunities
Quicker decisions
OTB, PickUP, Forecast, Price Recommendations (LIVE from
PMS)
Integrated data such as STR, Competitor data, Online
Reputation, etc can all be seen on the same platform.
Price recommendations according to setup business
rules & forecast are directly sent back to PMS
!
An RMS gives you back time, so your team can be more strategic and less operational
4 hours on the same platform – no more Excel
RM Daily Tasks
No manual report running and updating spreadsheets
One platform for all! No more updating several excel spreadsheets No Speed Constraints!
.No more Excel and logging in to various platforms
Saving time and removing the risk of human error
Your team can be more Strategic and less operational
How an RM system will impact your daily job
▍No manual report running and updating spreadsheets
▍Near real-time data
▍Accurate data
▍Easy user interface
▍Flexible reporting
Exploring the ROI of a revenue management system
Hard ROI
▍RMS increases in RevPAR through OCC and ADR
Exploring the ROI of a revenue management system
Soft ROI – Save time
▍No more manual data entry or reports
▍Customized reports and alerts
▍Spend more time being strategic
Questions?