When the pandemic started, most of the travel industry - agencies, OTAs, channel managers, airlines, and GDSs - was transaction-based (earning commissions or being paid fees per transaction).
Not transacting in a transactional model is, of course, disastrous. You're still providing pre-pandemic services to your customers, but the baseline for your earning is no longer there. Such rigid, fixed models are inherently dangerous to success, and the pandemic has highlighted this. Now is the time for travel to take a more flexible and agile approach to business.
Thinking ahead, then back, then ahead
Building agility is about learning to pivot and think in multiple directions at once. The key function of a revenue manager’s role is to plan – to always be thinking ahead. But to do this, we need to think ahead, then back, and then ahead again.
For example, if I am thinking in an agile way and need to set a goal for an initiative, I start by asking what my target is for, perhaps, three years? Now, I’ve put a line in the sand for where I need to be by that time. But to achieve that, I also need to plot where I need to be in two years and one year.
Working back from the end goal, I create a series of stages. Now I can fine-tune my three-year plan through the stages. I’ve looked ahead (three years), then thought back, and now I’m thinking ahead again.
This is called agile scrum thinking.
It is also naturally expressed in Duetto’s revenue strategy model. Our approach - which is embedded in our revenue strategy software deployments and post go-live consulting - starts with identifying where the market is at today. We work with our customers to ascertain their long-term goals. We work back from that in increments. And together, we can then help them redesign and flex their business model to enable them to meet those short-term stages and the end goal - of course, with the ability to flex short-term strategies to support the longer team objectives (and, potentially, shift our longer-term thinking if we need to alter our end game).
Big picture, small details
A key benefit of agile thinking is to be able to examine the whole picture while also zooming in on relevant details. For example, our enterprise-level customers may need data for an entire portfolio of properties, but also want to zoom in on a specific brand, or a cluster of properties, or even one individual hotel - and then process this data and roll it back into their wider plan.
Having instant access to real-time business intelligence that you can slice and dice, as needed, is vital. When it comes to rolling out your strategy, automation you can control (at an enterprise, property, or group of properties level) and set parameters on - can drive greater efficiencies and higher profits.
As we flow into budget season, being able to strategize before forecasting is another key lever in adopting an agile approach. Our VP of Sales for EMEA, Michael Schaeffner, outlines this brilliantly in his blog Agility & Change Vital To Creative Revenue Management. Strategy needs to be fluid and not tied to a static forecast.
Duetto’s agile philosophy
Born from the 2008 global economic crisis, being agile is at the heart of our philosophy here at Duetto. It’s what makes us a reliable, innovative, and flexible partner for hotels in today’s uncertain trading conditions.
Our Open Pricing methodology is the most flexible pricing model in the market, enabling hotels to yield rates independently based on dates, channels, room types, and other factors without closing any availability. End users can tailor their pricing strategy to best suit their business and then change it quickly and easily as soon as (or even before) the market shifts.
At the start of the pandemic, we were quick to pivot our forecasting algorithm to a short-term basis, enabling users to look back and ahead by just a couple of weeks, rather than trying to base strategy on Same Time Last Year (STLY). Hotel analytics expert and published author Ira Vouk outlines this success in her recent blog Reimagining Demand Forecasting For The Hospitality Industry.
Our adaptable commercial model enables our customers to pivot and move with variable demand and an uncertain marketplace.
To be consistently innovating for success today, hotels must own the ability to work in an agile way. You need to be able to pivot and change individual pieces of your pricing strategy to respond to changes in demand, changes in guest requirements, or the specific needs of a property, area, or location.
Discover how our agile approach to revenue could help your hotel business put strategy before forecast in 2022. Book a demo today to learn more.