Traditionally speaking, hotel management and revenue strategy have focused primarily on rooms. Moving forward, in order to maximize revenue and profits, hotel management teams must focus on optimizing revenue from each guest, using the entire asset. Each individual guest has the potential to generate much more revenue than just the room.
Tips for a Robust Revenue Strategy
Consider All Points of Revenue
Think of how you can increase revenue from a single guest in each of these areas: food and beverage, retail, spa, golf, third party bookings, and groups. Delve into your hotel’s analytics to see which areas are bringing in the most revenue, and which areas have the potential to bring a whole lot more.
Utilize Analytics
Analytics can produce a clear picture of the constant changes needed in all of those areas. Revenue management shouldn’t be conducted in a bubble. Instead, a team should evaluate each revenue stream, determining the most profitable segments and strategies.
Strategize Before Acting
Strategy is the key word here, since your hotel is an asset consisting of many channels of revenue, you want to have a comprehensive strategy in place to address total revenue management. You and your team must brainstorm the best methods to encourage each guest to “enjoy” as many hotel services as possible. How can you better advertise your hotel’s amazing happy hour deals, the award-winning chef, the stunning golf course, the newly renovated spa, and more?
Implement Effective Technology
Developing a strategy, and then in turn tactics, is half the battle. You must also make sure you have the optimum technology in place to support total revenue management, and then track it. A hotels biggest shortcoming is often times ineffective technology, rendering the hotel ignorant of which strategies are actually working, and which aren’t. Before even beginning to develop total revenue management strategies, make sure you have the best analytic system in place providing constant feedback. Analytics will help hold your management team accountable to enacting the proper changes and adjustments to the strategy, based on the data. Do this well, and your hotel is sure to succeed, and by success I mean, increase revenue on all fronts.
Some say that total revenue management represents the future in our industry. In order to be ahead of the curve, those practices must be implemented today. We are constantly implementing them in the hotels we manage, and if your hotel is in need of assistance developing a solid revenue strategy, contact us at HMG today.
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