REVENUE STRATEGY MANAGEMENT FOR HOTELIERS

CASE STUDY FROM CMH – MBA 2 - L. HER

SOURCE : REVIEW PRO WEBINAR

For case study only – not for professional use

TOPICS

Challenges Hotels face

Rising costs of acquisition

Multiple channels of distribution

Multiple Metaserach engines

Parities

Reviews

Impact on their Revenue & Profitability

New Revenue Management Strategies

Hotel Online & Direct New Strategies

Why should Hotel apply them?

REVIEW PRO proposals

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More than 10,000 hotels in 90+ countries rely on ReviewPro to improve guest satisfaction and increase revenue

Revenue Optimizer

Automated Reputation-Driven BAR

ReviewPro / IDeaS Rate Recommendations

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One evidence: HOTELS MEET NEW

CHALLENGES :• Metasearch = search engines of

serach engines ! • Multiplication of channels of

distribution• Rising costs of guest acquisition :

Main RevPar and Sales Recovery increased revenues go to intermediairies’ commissions instead of going directly to the Hotels’ profits – Brand fees – Marketing costs…

• Rate parities• Impact of Reviews

REVENUE MANAGEMENT : BEFORE / AFTER

BEFORE : optimization of room revenue + occupancy rate

Strategy : Managed

Revenue

Maximized Demand

Key Element : focused on

pricing,

forecasting,

budgeting

NOW: Revenue Management has become strategic because it must take many elements into account

Strategy :

Build on Long Term

Create disruption in prices to create disruption in demand

Key element : Optimize Total Revenue not just Room Revenue

Work with other departments : Marekting Brand, e-commerce, Sales

Distribution costs : optimize booking channels via understanding of their costs

MOTTO : Get out of your Confort Zone !For case study only – not for professional use

A BETTER WAY TO MEASURE REVENUE MANAGEMENT ?

…does not take into account the cost of e - booking commissionsRevPar

ProPar

CREATES DISRUPTIO

N

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ONLINE HOTEL STRATEGY vs DIRECT STRATEGY?

One Strategy : REPUTATION

ONLINE : Metasearch & OTA’s

Hotel must choose carefully its OTA’s. Not all correspond to its profile

IMPORTANT : Hotel must feel confortable with them

Hotel must undestand costs of distribution to optimize its choice

Offer only standard rooms i.e.

Audit your content regularly

DIRECT STRATEGY : SERVICE, SERVICE

Catch the customer when he’s at the Hotel

Offer exclusivities : added value proposals not found on OTA’s

Offer rooms other than standard rooms with preferred rates not found on OTA’s

The big

Four… But not

only

Empowered Customer = REPUTATIONService > Price

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WHY SHOULD HOTEL APPLY NEW STRATEGIES WITH ONLINE BUSINESSES ?

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