IDeaS Consulting Services answers some of the commonly-asked questions from hotels across the globe
Neil Corr, IDeaS senior advisor in EMEA, discusses the different ways today’s hotels can achieve intelligent revenue strategies in a Big Data-driven world.
- With the growing sources of data today—especially with new demand, market and travel intelligence data—what’s the best way to ensure we have a smart revenue strategy?
- Today’s revenue management teams must assemble and coordinate all this emerging industry data (which covers many functional departments) and utilise decision management tools to not only deliver their strategy, but to also optimize it. The key to achieving an intelligent strategy is understanding which data to prioritise, which is most relevant to the business and subsequently converting it into actions that deliver optimal revenues. Demand and market intelligence provides insight beyond just booked data into the intent to book, which creates a new level of clarity for hoteliers by bridging the gap between ROI on marketing efforts and overall revenue strategy. The industry must quickly modernise the antiquated practice of relying only on historical, regrets, denials and basic trend data to fold in more agile, forward-looking demand data for optimal revenue strategies. This means combining a holistic view of demand intelligence and analytically-driven actions into profitable results.
- We get that it’s a data-driven world and that more and more, distribution and channel data are driving revenue, but this does bring with it some pitfalls. What should we look out for?
- We have certainly observed many examples of clients perhaps being too data-driven on our consulting projects across organizations of all kinds. Examples include: utilizing only internal data, historical data, and high risk/high uncertainty data types (e.g. weather). Revenue strategy can be further compromised by using tools that only display—not incorporate—data into its optimization process. Inevitably, this can mean we will get quickly lost in a sea of statistics and figures, unable to prioritize the most critical data, which prevents us from uncovering the best revenue opportunities.
- My general manager always says the days of good old-fashioned yield management in the ‘90s—when phone, GDS and CRS channels were the only sources of booking data—actually made things easier to run the business. Does he have a point?
- It’s tempting to look back misty-eyed to the nostalgic mid-90s when reservations or yield managers bemoaned the lack of data to accurately forecast demand. And it would be interesting to see how they’d have coped with prioritizing and assembling today’s plethora of data sources into a coherent revenue optimization strategy. Very often on client projects, we see how the abundance of data can actually result in illogical or confused pricing and inventory management decisions. But back then, availability, price and reach were the prerequisites of an optimal revenue strategy. This is clearly limited and inferior with today’s demands. In 2017, agile revenue management strategy must account for cost of acquisition, consumer sentiment and reviews, and travel intelligence. Add to this the importance of a broad integration and connectivity infrastructure, which is all necessary to deliver a transparent and customer-centric revenue strategy.
Interesting in even more industry reading? Here are two articles we can’t stop sharing:
- How the hospitality industry is embracing social media…and the results are generating revenue
With 2.3 billion people active on social media, online and social media marketing is a trending hospitality topic. Guestline tackles some of the ways today’s hotels can adopt some very successful social strategies
- Maximizing Revenue in Hospitality
How can hospitality CMOs deliver exceptional customer experiences while optimizing revenue? Deloitte discusses overcoming challenges and delivering customer value and higher revenues in this Wall Street Journal article
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- Can Hotel Revenue Management Ever Satisfy a Finance Leader’s Forecast & Budget Demands? - September 16, 2020
- Bed & Brexit – Can Futurecasting Help Hoteliers Accommodate the UK’s Bumpy Departure? - December 5, 2018