Revenue Management Hospitality Industry
Revenue management for hotels is a complex topic. We explain everything you need to know and are at your side as a competent partner.
Revenue Management for Hotels - Increase Your Turnover!
Hotel Revenue Management: Strategies for increasing revenue
Revenue Management (RM) is a comprehensive strategy to optimize your hotel's revenue. However, it is not only about setting the right prices, but also about controlling availability and managing demand. Through targeted measures, you can thus increase the occupancy of your hotel and thereby increase your revenue.
For this purpose, revenuemanagement often uses dynamic pricing in the course of yield management. As a hotelier, you can use a revenue management system for this purpose. With the help of the revenue management software, room rates can be adjusted dynamically and automatically, depending on the criteria defined in advance.
For dynamic pricing, you can set your own criteria and parameters that your revenue management system will use to set your prices, such as:
- the capacity of your hotel,
- the current room occupancy rate,
- the current as well as anticipated demand (e.g. over public holidays, trade fairs or school vacations) and
- the minimum and maximum price for individual days and periods.
The important thing here is to implement and pursue a clear price and revenue strategy. This enables you to offer and sell your rooms at the right time and at the right price to the right customer via the right online sales channel.
3 pricing strategies for successful revenue management
You offer your guests upgrades to increase your revenue per guest. These can be upgrade options for a larger room or one with a balcony, for example.
Similar to up-selling, cross-selling is about increasing revenue per guest - but with additional services. This can be, for example, a hotel breakfast, access to the spa area or an airport transfer.
But cancellation conditions can also influence pricing. If the right to a refund is waived, for example, many hotels offer lower prices. Other pricing strategies include discounted direct bookings, rate parity, and forecast-based pricing.
Length of stay strategy
Prices vary depending on the length of the hotel guest's stay, such as longer stays during periods of low demand.
However, there is not THE ONE pricing strategy that fits every hotel. Rather, it is often an individual mix that brings your hotel the desired success.
What good revenue management must achieve
Revenue management involves more than just setting prices. That's why a successful strategy requires a comprehensive analysis of your booking figures and the market in advance in order to make the right decisions regarding prices, availability and booking channels.
Good revenue management must therefore be individually tailored to your hotel and your needs. This is the only way you can reap the benefits. It is also important that your revenue management system not only takes current trends into account, but also incorporates future developments.
However, with the numerous revenue management providers on the market, it is not so easy to make the right choice. Our experts will therefore be happy to advise you on the right option for your hotel.
Revenue management key figures in the hotel industry
To make the success of your revenue management measurable, it is important to have the right metrics in mind. These include, among others:
- RevPAR (Revenue per Available Room) - Revenue per available room
- NRevPAR (Net Revenue per Available Room) - Net revenue per available room
- ADR (Average Daily Rate) - Average daily rate
- OR (Occupancy Rate) - Occupancy rate
- EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) - Earnings before interest, taxes, depreciation and amortization
With these key figures, you can check the success of your measures and optimize the revenue management of your hotel in a targeted manner.
However, there are many other important key figures in the hotel industry that can have an influence on your revenue. Our experts will be happy to identify and analyze these for you and give you tips on how to perfect your hotel strategy.
Optimize hotel marketing through revenue management
In addition to purely increasing revenue, you can also optimize your hotel marketing with professional revenue management. Because effective revenue management goes hand in hand with successful hotel marketing. Thanks to the data and evaluations collected with your revenue management software, the right marketing measures for future steps can be derived based on these data and facts.
The following revenue management areas are particularly relevant for your marketing:
- collected guest data
- dynamic pricing strategies
- Demand forecasts
- Pre-booking time or booking speed of your target group
We take over the revenue management of your hotel for you
Let us help you realize the full potential of your room occupancy and pricing strategies with professional hotel revenue management!
Individual consulting by experienced experts
TourSol is your competent partner when it comes to individual consulting and comprehensive support in the area of revenue management.
We are a service provider specializing in optimizing prices and revenues in the hotel industry. We take over the complete revenue management and yield management for hotels and thus ensure a sustainable increase in revenues and profitability.
Our Yield Software Management System enables us to analyze your data quickly and effectively and to work out the right strategy for you. In doing so, we take into account not only the price, but also other factors that are responsible for successful pricing.
Regular reporting to the management keeps you up to date on the success of your strategy at all times and allows you to make adjustments if necessary.
Customized software instead of off-the-shelf offers
Modern hotel revenue management systems are an important support for the implementation of a successful strategy. With these software solutions developed specifically for the hotel industry, hotels of all sizes can dynamically control their prices, offers and availability and thus increase sales.
Moreover, by using cloud-based systems, these tools are no longer exclusively accessible to large hotel chains, but are also affordable for smaller and privately managed hotels.
In the area of revenue management, there are numerous off-the-shelf software packages. But often only individual software can meet the everyday requirements and needs of hoteliers. This is because every hotel has its own special features that can best be mapped by individual solutions.
In contrast to common revenue management software packages, we therefore offer you customized software that is precisely tailored to your needs. So you can be sure that you always get the best solution for your hotel.
Your advantages with TourSol at your side
- Maximum profitability through optimal pricing strategy
- Relief from administrative and operational tasks
- Regular reporting to the management
- Individual strategy for each operation
- Real and sustainable sales increases
- Expertise and technology for optimal results
FAQ - Questions & Answers
What is revenue management and why is it so important for hotels?
Revenue management is a strategy by which hotels adjust their room rates and availability, based on current demand, to maximize revenue. It is important for hotels as it helps them to optimize their capacity utilization.
What revenue management services does TourSol provide for hotels?
Our range of services includes a comprehensive analysis of your booking figures and the market, the development of an individual revenue management strategy, the implementation and monitoring of this strategy, as well as continuous optimization. We are thus available to you as revenue managers at any time with advice and support.
How much does TourSol's revenue management cost?
Since each revenue management strategy is individually tailored to the needs of the hotel, the costs also vary depending on the size and requirements of the business. We will be happy to provide you with an individual offer.
Do you want to exploit the full potential of your hotel and increase your turnover?
Benefit from our many years of experience in the field of revenue management and let us advise you individually.