Revenue managers and directors of revenue management around the world are finding themselves stretched to new limits. As such, it’s little surprise that we hear from many who are eager to find a revenue management system (RMS) to help streamline and automate tasks. But often, the burning question we get is “How do I get ‘buy-in’ from my organization?”
It’s understandable. Bringing in a new tech system, especially one so business-critical as an RMS, is a significant consideration. With teams becoming stretched without an RMS, however, burnout becomes a real concern. Also, with market dynamics more fast-moving and complex than ever, revenue leaders are seeking modern technical solutions to support them in their strategy.
Getting Buy-in – Where to Start
One route to getting buy-in to implement an RMS is the general manager (GM). Once the GM can see that an RMS is a worthwhile investment, the decision should roll up to ownership or corporate office.
At this point, it becomes more about establishing a revenue culture. Duetto client Sandman Hotel Group is a perfect example of this. Before we even showed them our revenue strategy platform, we discussed revenue strategy and Open Pricing with them. We also covered how RMS platforms help you efficiently capitalize on all of the demand opportunities that you have, with automation helping better balance DORM workload (to avoid burnout!).
"One of the areas that is overlooked, because you can't pick it up in the numbers, is how Duetto has positively affected the culture within the company from a revenue management perspective. And there are a couple of things that helped with that. Our strong leadership within the company helped us move this forward. They were certainly behind this, as was ownership. But then you have the individuals in the field; the general managers, the sales managers, and everybody who's been involved in the decision making, really buying into the concept of Duetto and automated revenue management helped us drive forward the culture change as well and that's key," Michael McNames, Director, Revenue Management, Sandman Hotel Group told us.
There are two main benefits to taking on an RMS, and both will help you garner buy-in from your top executives. These are:
- Operational efficiencies
- Financial efficiencies
Let’s look at each in turn.
Operational Efficiencies
One of the most critical (and daunting) tasks of a revenue manager is an operational forecast. Staffing shortages and volatile guest demand are heavily impacting staff scheduling. Roll in the fact that staffing is often the number one cost of a hotel and it’s an important balancing act to get right. Imagine if you had future insight into demand and could help your operations team better manage their staff rotas?
Operational forecasting with Duetto GameChanger helps hotel teams more accurately determine the number of arrivals and departures on any given day. This enables operational teams to schedule teams accordingly. For example, if you know you have a large group checking in on Monday, you may decide to staff an extra person at the front desk. But because you also know what time that group will be arriving, you only need the extra person for four hours. The same concept applies to scheduling other teams, such as valets.
Taking a wider lens, a 12-month forecast – such as the one available in Duetto ScoreBoard – enables revenue teams to provide insight into very low demand periods. This information can be passed to the engineering team so that they can schedule essential maintenance and upgrades during a time when having rooms out of order isn’t going to displace revenue.
Financial Efficiencies
Running your revenue on an RMS allows you to be accurate with your revenue forecast, specifically in the month for the month. Now, you can manage your cash flow more precisely. For example, if you know the second half of the month will be busier than the first, your financial officer may want to schedule larger outgoing payments later in the month to take advantage of that.
There are further financial efficiencies to be had from being able to manage your supplies more accurately and in line with occupancy. For example, linen and towels - as well as perishables for F&B.
Do Your Due Diligence
While we would obviously love every hotel out there to opt for Duetto, when choosing an RMS it is important to make sure it’s a system that is the right fit for your business.
Identify what you want the solution to do for you, based on your resources:
- If you are revenue managing multiple properties with a single DORM, you may want to pick a system that can be largely or even wholly automated.
- If you are in a growth stage, then look for a solution that can scale quickly and easily in line with your expansion plans.
- If you have a small and/or inexperienced team, you may want to work with a software company that also provides a customer success team to provide in-house revenue management experience that you can lean into, and ultimately enables knowledge transfer so you can engineer your own, distinct revenue culture.
- If you are a large enterprise, you will be looking for a system that enables you to maintain/differentiate your brand and price integrity with rate guardrails, while also empowering regional or on-property teams to flex pricing levers according to market demand.
- If you have a team of revenue strategists, you may want a system that enables you to become more granular with your strategies, segmentation, distribution, etc.
Our client Outrigger Hospitality Group is a great example of this. Their approach was that they wanted to be able to see and control everything. Automation was a critical facet of their growth plan, as was scalability.
"We have basically rewritten how we service our hotels. So automation is even more important at this point. Something that Duetto is very committed to is the customer success portion of the business. Because we need help in implementing the products and implementing the best practices [surrounding automation]. So that's something that I felt we've always partnered with Duetto very strongly on and I think that will continue," said Jenna Villalobos, VP of Commercial Strategy, Outrigger Hospitality Group.
Once you’ve defined your criteria for choosing an RMS, you’ll need to shortlist the vendors who you believe can deliver on your stated objectives. Hotel Tech Report offers the industry’s most comprehensive analysis of hospitality tech providers, including RMS vendors. You’ll certainly want to consider HTR in your shortlist selection.
Sit Back & Reap The Rewards
Of course, the primary reason for bringing an RMS on board is to help your hotel make more money. A human manually changing rates is never going to be able to dynamically (and profitably) act on changes in pick up. You cannot monitor bookings 24/7. And that’s before you start compiling reports on this to share with other team members.
If you're spending a lot of your time putting reports together, then you're not allocating time to analyze the data and act on it.
Tools such as the short-term forecasting algorithm in GameChanger help revenue teams to shrink the window on data trends that the system is using for future forecasts, so if the hotel has no historical data or it's a new build, it's a way for them to make informed decisions in just a couple of weeks. And from there, the impact Duetto can have on RevPAR and profit is immediate. We find that, on average, Duetto GameChanger adds 5 to 10 points of RevPAR Index to new clients within their first year of running revenue on Duetto.
Discover how Duetto could help your team maximize profit and streamline operational costs. Take our ROI Calculator now: https://www.duettocloud.com/tools/roi-calculator