The South Korean hotel market is currently showing a clear appetite for tech investment. Like most markets, the COVID pandemic affected South Korean hotels significantly, and as a result, many are starting to rethink and adapt their approach to revenue management, turning to technology to help.
One such hotel is L7 Gangnam by LOTTE Seoul, which joined Duetto in 2023, and uses GameChanger, ScoreBoard and BlockBuster. Before turning to Duetto, L7 Gangnam found that although short-term analysis was possible, long-term prediction was inaccurate, meaning it was difficult for them to be confident in predicting and implementing strategies.
“Most of the RM managers working with me had doubts about their analysis and strategies for the properties they manage,” said Jina Park, Revenue Manager, L7 Gangnam. “Since a revenue manager’s predictions and judgments can affect all aspects, including sales and competitiveness in the market, we wanted to help minimize errors through the use of Duetto. Duetto’s Gamechanger and Scoreboard are very helpful in the process of users making quick decisions and putting them into practice, personally referring to the functions of many categories,” they added.
Flexibility Is Key
L7 Gangnam is particularly enjoying Duetto's ability to respond quickly and flexibly to market changes. Park said: “By introducing Duetto at the right time at the end of the off-season, we were able to cope with rapid market changes and quickly respond to sales performance.
“In the past, it was necessary to spend a considerable amount of time to verify analysis and judgment before executing the RM strategy, but the Insight and Custom Report provided by Duetto made quick analysis and judgment possible.”
Park added: “By reducing a lot of time for analysis and increasing price competitiveness through quick rate adjustments, it was possible to respond quickly and flexibly, enabling L7 Gangnam to rank first in both ADR and RevPar, according to STR data.”
It took L7 Gangnam only about three months from onboarding to start seeing really significant results, and their revenue has already increased. Looking at the results of sales growth, the company grew by 73.3% year-on-year based on the cumulative total from January to May, and through this growth, it ranked first in the MPI Rank, second in the ARI Rank, and first in the RGI in May.
Park commented: “We introduced Duetto in March 2023, but I have been using it in earnest since April, so I don't think we have a complete result yet because it's still in the early stages, but I'm getting good sales results by utilizing Duetto's various functions.”
Since L7 Gangnam’s adoption of Duetto, Park admitted that the hotel’s revenue strategy has changed considerably, and that they are now maximizing the opportunity to sell at the right rate for dates that are outside of the primary booking window. Park said: “In the Gangnam area, demand changes rapidly depending on whether business events and concerts or festivals are being held, and price competition is fierce due to the high density of hotels.
“The hotel used to focus mainly on occupancy strategy, while increasing rates on high demand dates with a short lead time. With Duetto, we were able to improve our ARI (Average Rate Index) by being able to confidently increase rates for dates that are further out.”
Referring to Duetto’s ease of use, Park added: “It is very simple to implement our strategy into Duetto. We can adjust rate supplements by room type, and we can change our competitive positioning based on different conditions such as dates, day of week, and even demand level.”
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