Due to the pandemic, hotel revenue management need to get more creative.
The Impact
The ongoing COVID-19 pandemic severely affects the entire hospitality industry. Within it, hotels worldwide are experiencing challenges as the method and ability to rely on historical data gets weaker. This is because revenue management technologies traditionally depend on demand patterns such as booking lead times and seasonal stay patterns. While it is important to assess the best possible room rates, the current market conditions have made this system obsolete.
The Challenge
The COVID-related volatility in consumer demand and pricing highlights the need for new ways to support revenue recovery.
Facing limited demand due to COVID-19 travel restrictions, hoteliers must think outside the box to capture bookings and maximize revenue. As pricing practices made sense before the virus hit—like seasonal pricing and non-refundable rates—may not be so relevant now in our pandemic era. Even though these unprecedented coinditions still exist, there are some things that can help. It has been observed that hotels taking part in a revenue management services have outperformed occupancy, ADR, and RevPAR.
The hoteliers must rely on sophisticated, demand-centric revenue management systems, with the ability to collect and analyse real-time market demand indicators to accurately price their rooms during the ongoing COVID-19 pandemic and beyond. With real-time insights and actionable rate performance, hotels can make quicker and more accurate revenue decisions. It will also provide access to competitive business intelligence, personalised room-type mapping including events, seasonal calendars, and key drivers influencing market rates.
In this tentative climate, hotel revenue management strategies should aim to boost consumer confidence, focus on value, and increase revenue per guest.
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