People Behind the Revenue Management System

An effective hotel revenue management system is the key driver behind the hospitality industry’s ability to survive the economic crisis, retain and attract customers, and increase RevPAR. And the importance of revenue management has never been more important than now. Since the market is expected to decline overall, the average RevPAR and other hotel metrics will expectedly experience a downtrend as well. With a good system in place though, a hotel revenue manager can look past this into the real potential of his hotel. Getting a deeper understanding of the hotel clients is crucial in this stage. For example, in a normal urban/suburban transient property for corporate executives, price sensitivity is lower because they are not the ones paying the bill. Even if the corporation is managing the cost of travel, the reality is that travelers will still prefer prime locations, complete facilities, and other amenities. Another factor that should be considered is the bookings from hotel electronic sources. Because of the popularity of the internet, electronic hotel sales have been steadily increasing for the past decade. Hotel sales channels such as e-commerce, franchise web sites, and GDS systems should be looked into carefully. Usually, the hotel sales derived from these mediums come from leisure travelers who are looking for good deals. It is important to measure the potential of each contract. This will enable both the hotel revenue manager as well as the sales staff determine how the business can be aligned in relation to their client profiles. But more than that, all the people involved in the hotel revenue management strategy should really believe that it is effective in order to execute it property and boost profitability. If the people who are behind the yield management strategy and hotel software don’t believe in its capability, it will reflect on their performance. Remember that no matter how sophisticated inventory software, yield management software, or hotel software is; ultimately it is still people who use these tools. Unless it is utilized to increase RevPAR and increase hotel profitability, it will just be another tool that can be effective or ineffective in the decision-making process.