Maximising Hotel Revenue: Why selling your hotel’s distressed inventory should be stress-free

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Juggling the day-to-day management of a busy hotel can feel overwhelming at times.

All over the world hoteliers, just like you, are working hard to keep the many complex facets of hotel operations in check.

In any given day, you might deal with your hotel’s latest promotions and marketing messages; the analysis of your sales figures and occupancy rates; the management of guest expectations and online reviews; the supervision of maintenance works and renovations; and that’s before we even mention the effective management your hotel staff.

It’s no wonder then that findings from Roy Morgan Research in 2014 found hospitality workers to be the second most stressed – with sales support workers taking the top spot.

Using technology to alleviate stress levels

Despite the alarming stats, help is always at hand for busy hoteliers looking to reduce their stress levels.

Just as technology empowers travellers and guests to explore their online options and conveniently book their chosen accommodation, intuitive technology can eliminate the manual processes that dominate your daily routine in your hotel.

Research from a Phocuswright study, co-sponsored by SiteMinder, found that many hoteliers, across both the US and Europe, are not using hotel technology to effectively streamline their day-to-day processes.

“Use of technology to manage (as opposed to facilitate) distribution and online marketing is weak among US independent properties,” revealed the report.

Phocuswright and SiteMinder drew a similar outlook for hotels in Europe: “Rates and availability are mostly manual processes, with each distribution channel managed separately. Strategy and structure are missing from pricing strategy, making it difficult to optimise channels and compete effectively with chains.”

The problem: Selling your hotel’s distressed inventory

One great example of how you can use technology to positively impact your hotel’s operations is last-minute bookings.

We know that mobile devices are changing everything. Half of the world’s population now has a mobile device – up from just one in five 10 years ago. That in turn means that more guests are booking your hotel on smartphones and tablets, and crucially, they’re doing it increasingly at the last minute.

Data from Hotels.com shows that 50% of travellers who book via mobile devices do so for last-minute or next-day stays.

This trend represents a huge opportunity for hotels to sell their very final rooms, right up to the last minute. But only hotels with the right channel management technology in place will be able to take advantage.

Many hotels are still operating a channel manager with an inventory allocation model. With this method, the hotel allows each of its channels a certain number of rooms. This means splitting inventory according to how much you think each channel will sell, and reserving some for direct bookings. There are several drawbacks to this approach.

Firstly, you may overbook your rooms. For example, you accept a booking over the phone, but within minutes the room is sold via a booking site, before you can log in and update it. With your room now double-booked, you have to upgrade your guests, or turn them away completely. Many hotels keep back a number of rooms to avoid this happening, losing out on valuable revenue by holding rooms ‘just in case’.

It’s great to have a diversified distribution strategy with connections to many different channels. But ultimately your hotel needs one single connection that can shield you from the madness.

The solution: Pooled inventory to increase revenue and reduce waste

The answer is a pooled inventory system via a channel manager such as SiteMinder’s. A seamless two-way connection to your hotel’s various booking sites is key to ensuring the constant flow of information is reliable.

This allows you to increase your revenue and reduce waste, by ensuring all your inventory is available across all channels – and you can keep all available rooms listed right up to the last minute. When a room is booked, SiteMinder’s Channel Manager automatically updates it across all channels. You can change the room rates across all channels without logging into multiple sites to make updates, and maintain or increase your rates.

Pooled inventory is a big benefit when shopping around for a channel manager. Savvy hoteliers should always look for hotel technology solutions that connect a property with global guests.

Choosing the right channel manager will also enable you to –

  • get your hotel booked faster
  • remove manual entry with complete real-time automation
  • have all your rooms online at once to increase revenue
  • understand deep reporting to help analyse trends such as last-minute bookings

You can expect further innovation in the hotel industry as trends such as mobile play out, offering the opportunity for canny operators to further grow revenue and reduce the waste associated with empty rooms.

We first published this article as a guest contributor on eHotelier.

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