How to store, track and promote your hotel inventory effectively – part 2 of 2

  Posted in Channel Management

By Fig Cakar, Managing Director – the Americas, SiteMinder

Increased competition and transparency in today’s booking landscape is making effective management of inventory a high priority for today’s hotelier. Last week we discussed three key aspects of creating a balanced inventory management strategy and why they are important.

In this week’s part 2, we’ll be looking at how technology, in particular Revenue Management Systems (RMS), can help you understand, price, and promote your inventory more effectively in tandem with your channel manager (CM).

What an RMS can do

We live in an era of big data. In order to create accurate demand forecasts and update room prices in real-time, you are going to be reliant on technological solutions. At the most basic level, a RMS can mine your reservation, booking and data, producing demand generation forecasts for every type of room for every day of the year. You will be able to see historic booking channels, lengths of stays, prices paid and the yield generated on each room, as well as any patterns in cancellations.

These forecasts work alongside optimisation programs in order to set inventory controls, enabling you to automatically set different rates for room types and lengths of stay up to specified overbooking levels. This approach allows you to cherry pick the highest value bookings (which given differences in underlying costs are not necessarily those with the highest room rate), thereby optimising the yield on your inventory.

Dynamic pricing

Pricing precision and pricing optimisation are the two most important parts of your inventory management strategy and are key drivers of your revenue per available room and profitability. According to, “even a $1 reduction in the ADR (average daily rate) for a 500-room hotel with 70% occupancy would cost that hotel over $127,000 in lost profit per year.”

In order to take advantage of dynamic pricing, you need a system that can respond to information in real-time, allowing you to stay on top of any emerging trends or shifts in customer behaviour. A RMS with dynamic pricing capabilities can also track changes in your competitors pricing and, within your specified parameters, adjusts prices accordingly so that your prices on OTAs and meta-search engines remain competitive.

Integrating your RMS with your channel manager

By integrating your Revenue Management System with your channel manager, you can quickly distribute real-time rate recommendations from your RMS, making sure your rooms are selling for the right price. An important piece of the inventory management puzzle, your channel manager ensures that rates and availability are automatically adjusted in real-time across all booking channels in order to reduce the time it takes to update room prices and increase revenue. By monitoring demand and sales trends via your RMS, channel manager, and in-house reporting you can effectively manage, promote, and reallocate your rooms.

For maximum efficacy, your technology solutions should also be fully integrated with your marketing initiatives. Hotels that have already integrated the work of their marketing and revenue management departments have benefited from revenue increases of more than 6%. In particular, marketing campaigns can be implemented at specific times and on specific channels in response to RMS analysis.

For example, mobile phones are often used as last-minute distribution channels, so if you have rooms to fill on the day, you can focus your promotional efforts on this channel. By integrating your RMS with your channel manager, you will be able to track the booking patterns through different promotional and sales channels, understand their efficacy relative to one another, and adjust your marketing activities accordingly.

Leverage technology for more powerful inventory management

Technology can not only help inform human decision making, but also show the impact of those decisions in real-time, enabling you to streamline your marketing strategies and capitalise on emerging trends. And by bringing your technological and human resources together, you can help maximise your inventory yield through more targeted marketing opportunities.


Channel manager guide

Thanks for sharing

Sign up to our blog and receive regular updates on the content you're into

Send this to a friend