What is a hotel revenue management system?
A hotel revenue management system (RMS) is a technology platform that helps hotels make smarter pricing and inventory decisions. It collects and analyses data, like occupancy rates, booking patterns, local demand, and competitor pricing, to automatically adjust room rates in real time.
Think of it as a behind-the-scenes strategist. While you focus on running your property, the RMS is working in the background to make sure you’re charging the right rate, to the right guest, at the right time.
For hoteliers who are still using spreadsheets or ‘gut instinct to set prices’, switching to a revenue management system means gaining a data-driven, automated way to maximise revenue without increasing workload.
And it’s not just for large chains anymore. Many modern RMS platforms are now accessible to medium-sized hotels and growing groups, especially those juggling multiple locations and seasonal fluctuations.
In this article, we’ll show you why hotels that adopt revenue management software report an average increase in revenue per available room (RevPAR) of between 7% and 20%, and how your hotel can effectively adopt the best possible tool for your specific needs.
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Why is a revenue management system for hotels important?
Running a hotel is already complex. Between staff management, guest experience, and day-to-day operations, pricing strategy can quickly fall to the bottom of the list, despite being one of the biggest levers you have for success. For hotel owners managing multiple properties, the challenge grows. Coordinating rates across locations without a centralised system is time-consuming and risky.
A revenue management system removes the guesswork. It uses live data to automatically adjust your prices based on demand, seasonality, competitor behaviour, and booking trends. An RMS gives you a single source of truth so you can manage pricing and performance from one dashboard rather than toggling between spreadsheets or systems.
Instead of reacting after the fact, you’re staying ahead of the curve. More importantly, it frees up your time. Time you can reinvest into your team, your guests, and your business strategy.
Hotels that implement revenue management systems report measurable improvements in both operational efficiency and financial performance. In fact, the global hotel RMS market is expected to grow from USD 16.4 billion in 2023 to over USD 29.4 billion by 2031, driven largely by increased adoption among mid-sized hotels.
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How do hotel revenue management systems work?
In short, an RMS is a data connector. It pulls in data from various sources, including your hotel’s booking history, current occupancy, competitor rates, market demand trends, and even local events. It analyses all this information in real time and recommends optimal pricing for each room type.
Many RMS platforms also update your rates automatically across your direct booking site and connected OTAs, so you don’t have to log in to multiple platforms. You can set rules and thresholds, such as minimum and maximum prices or lead-time strategies, so the system aligns with your business goals.
Some tools go a step further by offering demand forecasts and performance dashboards. These insights help you plan staffing, promotions, and even room availability across different distribution channels.
Instead of spending hours adjusting rates manually, you can focus on strategy while the system keeps your pricing competitive and your inventory selling efficiently.
Use of revenue management system examples
- A 60-room coastal hotel sees spikes in demand during long weekends. With a revenue management system, it detects booking surges early and raises rates automatically, adding thousands in incremental revenue each season.
- A multi-property hotel group uses an RMS to align pricing strategies across three locations. With a centralised dashboard, the revenue manager saves hours each week and responds faster to market changes.
Key benefits of revenue management systems (RMS)
A revenue management system isn’t just a pricing tool. It’s a business growth tool. For hotel owners managing multiple properties, or just looking to make smarter decisions, the right RMS can:
Improve profitability
By analysing live demand and competitor pricing, an RMS helps you charge the optimal rate for every room. This means capturing high-value bookings when demand is strong and staying competitive when demand softens.
Increased efficiency
Instead of updating rates manually across multiple channels, an RMS can automate this process. That means fewer mistakes, better rate parity, and more time for you and your team to focus on guests, not spreadsheets.
Better decision-making
Dashboards and forecasting tools provide a clear view of your performance and market trends. You can see what’s working, spot opportunities, and make proactive decisions that support your revenue goals.
Enhanced customer experience
With smarter pricing, you avoid underpricing during peak periods or overpricing in slow seasons. Both hurt guest satisfaction and bookings. The right RMS helps ensure your rates match what guests are willing to pay, improving conversion and perceived value.
Shadi Wijaya, Corporate Director of Revenue The Phala Group
How to find the best hotel revenue management systems
Choosing the right RMS comes down to finding a system that matches your property’s needs today and can scale with you tomorrow. Here are some essential features to look out for:
- Rate comparison: See how your pricing stacks up against competitors in real time, so you can stay competitive without constant manual research.
- Forecasting: Predict future demand using historical data and booking trends, helping you prepare for high and low seasons with confidence.
- Dashboard with reporting: Get a clear, centralised view of performance across one or more properties. Ideal for tracking KPIs like occupancy, ADR, and RevPAR.
- Integrates with existing systems: The best RMS will plug into your PMS, channel manager, and booking engine, syncing data and reducing double-handling.
Not every system offers the same depth or flexibility, so it’s worth trialling options that let you see the tools in action.
The top 5 hotel revenue management systems
If you’re ready to invest in a revenue management system, these platforms are worth exploring. Each offers different strengths. Some are built for simplicity, others for advanced strategy, but all aim to help hoteliers grow revenue and work smarter.
1. Duetto
Duetto gives hotels more control over pricing than many other systems. Its open pricing model means you can set rates by room type, channel, and customer segment without sticking to rigid pricing structures. It also offers smart automation with custom rules, so you can decide when the system should take over and when you want to stay hands-on.
2. Cloudbeds
Cloudbeds’ RMS uses data from across its platform to automate pricing and inventory decisions. Its user-friendly interface is great for independent hotels and small groups that want to get started quickly with smart pricing.
3. BEONx
BEONx focuses on holistic revenue strategy. It’s particularly strong for hoteliers who want to blend revenue management with guest experience metrics, offering features that help align pricing with guest value.
4. IDeaS Elevate
A well-established RMS with a deep feature set, IDeaS is known for its forecasting accuracy and strong analytics. It’s popular with larger hotels and chains that need robust data modelling.
5. Diamo
Diamo is a more recent entrant focused on making revenue management accessible to mid-sized hotels. Its interface is clean, and it provides helpful decision-support tools for teams that aren’t ready for a full enterprise solution.
These platforms vary in cost, complexity, and integration options, so the best choice depends on your size, tech stack, and growth plans.
