No two revenue strategies are the same. Each hotel and each market is different. Factor in the various room types in a single property and the fact that no two days will perform the same and you can see how hard it can be to pinpoint what works and what doesn’t. That was the task set before me when I had the pleasure to moderate a panel discussion on Revenue Strategy Best Practices at the recent Dublin Revenue Lab, organised by Avvio and Duetto.
With a stellar line-up of panellists from consultancy to big brands and independents, we navigated through the building blocks required to formulate a strategy that works.
Jutta Moore, Managing Director of Moore Hotel Consulting, got us off to a great start with a concise appraisal of what should be the starting point of any hotel revenue strategy.
“It's understanding your hotel's objectives and looking at the entire year in terms of your demand periods,” she said, explaining the importance of highlighting high and low demand days and understanding where intervention, such as promotions, is needed to create opportunity.
“Automate as much as you can so that you can actually focus on the strategy and not on compiling Excel sheets,” she urged.
For far too long, departmental silos have hampered the way hotels drive revenue. Departments such as sales and marketing need to realise the important role they too play in revenue generation and optimisation. However, getting everyone aligned isn’t always easy.
Alessandra Leoni, Head of Revenue & Distribution at Nadler Hotels, admitted that’s been “one of the toughest things to do” in her role managing revenue across a portfolio of seven unique properties.
“We make sure that we align the KPIs to be the same across the different departments. So, they are actually buying into selling at higher rate, into closing and implementing minimal length of stay restrictions on key dates for corporate segments that are not yieldable,” she explained.
According to Leoni, making sure the expectations are the same is vital, as well as having the tech to deliver transparency and one ‘source of truth’ in the hotel data.
Brand Vs Independent
Andy Leung, Director of Revenue Management & E-Distribution for Ireland’s Hodson Bay Group gave the audience an insight into his role managing revenue for a mix of brand and independent hotels. Hodson Bay Group manages the Hodson Bay Hotel, Galway Bay Hotel, Sheraton Athlone Hotel and the recently opened Hyatt Centric The Liberties Dublin.
I’m very lucky to experience both global and independent,” Leung said. “A global brand has everything set up for you, while with independent the main question I come across is, ‘where do I start?’”
However, while independents may not have the back-up of big brand tech and processes, they can change direction more rapidly. A big brand is like trying to steer a big cruise liner, while an independent is a speedboat.
“At the Hodson Bay Group, we are quite bold. We always challenge,” said Leung, explaining how independents can act more on impulse.
“Say we need an offer now, for Halloween. For the global brand, that's a restriction. For an independent, we have our own digital team, we set it up today, tomorrow we have it live on a PPC campaign and we track everything.”
Following on from Andy’s comments on tracking everything, Moore explained to the audience what data they should be looking at.
“Today we have a lot of opportunity to get a lot of data very quickly. If you look at your rate shopper, even at the OTAs, your booking engine. A lot of these simple systems offer very good data insight,” she remarked.
Moore explained how hotels should be using tech such as rate shopping tools to gather market data to enable them to measure whether their demand is in line with the market.
“You can look back at your own history and see whether you're pacing same as last year, or same as a similar period. If you're a resort hotel and let's say your April and May are very similar to your September and October, you can look back at trends from just the most recent past, rather than a year ago. There's a lot of internal reporting you can look at. Obviously, if you have a revenue management system you have access to a lot more data,” she concluded.
Read more insightful takeaways from the Dublin Revenue Lab in our blog post Building An Ancillary Revenue Strategy.