In business, decision-makers and company owners are always looking for ways to optimize their financial goals and achieve desired profits. With this particular need, tactics, and concepts, such as revenue management, have become popular. Such a strategy is also applied in the hospitality industry.
Simply put, revenue management is a way of targeting the right customers at the right price and at the right time. This technique began in the airline industry, where air carriers always came up with forecasts to anticipate the demands for flights depending on the time or season. Nevertheless, you can apply these principles in other industries.
If you’re running a hotel or a resort, here’s how you should optimize it:
Create customer segments
Understanding your market is already a given. But you have to realize that your market has different segments looking for specific types of rooms, prices, and features. And since you want to sell the right place to the right guest, you need to create segments across your rooms and services and match them with customer segments that you have determined. Each product or service segment will have a price that will match the intended customers’ budgets. Hence, the classification of suites ranging from regular to executive rooms.
Increase the accuracy of your forecasts
One of the core areas of revenue management is forecasting. In this aspect of your business, you anticipate the demands for your rooms and services and the future revenue that will come with them. You can develop precise and accurate predictions when you look at your past sales records and financial reports. When creating forecasts and projections, you always need to remember that a lot of factors come into play, and these include the season, the usual months when foreign tourists arrive, and the prices of flights going to your destination.
Modernize your monitoring system
Hospitality marketing consultants always remind hotel owners and businesspeople that marketing has evolved and that decision-makers should not be left behind. In your case, you need to embrace methods that will make revenue monitoring systems. If you want to get guests’ insights, you can work with analytics teams that track the conversations of your target audience and determine the things that make them tick. You can also find revenue management systems and applications that are designed for hospitality businesses.
Check the trends
While the hospitality industry can be considered one of the oldest industries out there, its progress and evolution don’t stop. There will always be trends and improvements that make getting clients much easier. One of the digital techniques you might wish to consider is search engine optimization (SEO). You can also revamp the packages and offerings of your hotel by bundling experience-based services, such as tours and immersions (something that Airbnb does).
Continue doing what works
When it comes to revenue management, you need to do away with the things that clog your system. However, you need to retain what works. For better strategies, it is also essential to work closely with the key departments, such as sales and marketing.