Founded in the late 1960s in Ibiza, the Palladium Hotel Group has grown into an international hospitality business with a portfolio spanning Europe, the US, Latin America, and the Caribbean.
Its brand portfolio spans ultra-luxury resorts, city center hotels, all-inclusive family-orientated resorts, and adult-only retreats.
Operating such a diverse portfolio requires a combination of revenue management expertise, advanced analytics, and algorithms to optimize every revenue opportunity.
This blog is an excerpt from our latest special report, How Hotels Use Open Pricing to Optimize Revenue. Download your free copy here: https://www.duettocloud.com/special-reports/how-hotels-use-open-pricing-to-optimize-revenue
In 2016, Palladium Hotel Group contracted with Duetto for its entire suite of revenue management solutions. The company uses GameChanger for pricing, ScoreBoard for forecasting and reporting, and BlockBuster for group business optimization, across the group. In total, 32 hotels, totaling 11,755 rooms, run their revenue on Duetto.
Even before adopting Duetto, the revenue team at Palladium Hotel Group was looking for dynamic ways to price rooms. When the two companies came together, it was a perfect match.
Diego Fernandez Perez De Ponga, Global Senior Director of Revenue & Distribution, Palladium Hotel Group, remembers his first impression of Open Pricing.
“Open Pricing presented a paradigm shift in revenue management by allowing us to dynamically price our inventory based on demand and market conditions. The concept of breaking away from traditional rate structures and being able to optimize pricing for each individual booking was intriguing,” he said.
“This newfound ability to optimize pricing on a per-booking basis was truly fascinating and held immense promise for our revenue management strategy.
Onboarding with Duetto and educating the team on Open Pricing, was an easy process according to De Ponga.
“The onboarding process was really an easy project. We brought in experts from Duetto to provide in-depth explanations, best practices, and case studies to help our team understand the methodology and its potential benefits. We also encouraged hands-on practice and provided ongoing support to ensure a smooth transition,” De Ponga recalled.
Segments, Room Types & Creative Packages
Open Pricing has enabled the revenue team at Palladium Hotel Group to create segments and room types set up to convert at the best possible price point. What’s more, this strategy is continually evolving.
“The success of specific segments or room types may vary depending on the hotel's location, target market, and customer demand. Through careful analysis and continuous monitoring of our performance, we have identified the segments and room types that consistently yield the highest returns,” De Ponga remarked.
Based on this insight, De Ponga and his team adjust their pricing and distribution strategy to optimize revenue from these segments. This may involve:
- Allocating more inventory
- Offering competitive pricing
- Employing targeted marketing initiatives
This has enabled the team to get more creative with their packages.
“Open Pricing has significantly enhanced our ability to get creative with our revenue strategy and the packages we offer. With the flexibility to set different prices for various segments, room types, and channels, we can design tailored packages that cater to specific customer needs and preferences. This has allowed us to differentiate our offerings, target niche markets, and capture additional revenue streams that were previously untapped,” De Ponga said.
Defining Open Pricing
Palladium Hotel Group has been optimizing rates using Open Pricing for eight years. So, how would De Ponga explain Open Pricing to another revenue professional who is unfamiliar with it?
“Open Pricing can be explained as a revenue management approach that allows hotels to price their inventory dynamically based on real-time demand and market conditions. Unlike traditional rate structures, which often rely on fixed pricing tiers, Open Pricing enables revenue managers to optimize pricing for each individual booking, ensuring maximum revenue generation. It leverages advanced analytics and algorithms to determine the optimal price for every segment, room type, and channel, resulting in improved revenue performance,” he said.
We couldn’t have put it better ourselves!