The hotel industry is price sensitive, so to maximise our hotel’s revenue we need to maximise occupancy as well as the average price of available rooms. Value can be added through excellent guest services, food and beverage packages, free parking, etc. Value-added extras that are unique to the hotel make the guest experience positive and memorable. This is the kind of value that leads to repeat stays.
Within the hospitality industry it is important to predict consumer demand in order to optimise the sales process, allowing companies to sell at the right price, to the right customer, and at the right time. When done correctly, revenue management can be extremely effective, helping hospitality companies to significantly increase their profit margins.
It is important to implement a revenue management culture within the hotel, as by creating awareness, positive behaviours can be encouraged from all staff members. It is important to take care when recording data as it is used to make knowledge-based decisions. The collection of such data is at the heart of the revenue management process and it will form the basis for almost all decisions.
Tactics to increase hotel revenue
Offer special rates
Discounted rates are one of the most effective and widely used strategies for hotels. Offering discounts is the best way to encourage potential customers to book.
Offer accommodation packages with complementary activities
Offer packages that include extra services, either internal (such as a welcome bottle of champagne or breakfast included) or external (tickets for shows, excursions, etc.), with this we will manage to give an added value to the offer of our hotel.
Selling rooms, especially of the lowest category
Since the cheapest rooms are the most easily sold, their sales should not be blocked, even if they are all sold. In the case of the low season period, once the customer arrives at the hotel, he can be assigned a room of a higher category for the same price, which will not only exceed his expectations, but will also fill more rooms without lowering the average price of the hotel.
Motivate accommodation levels
Once the customer has booked, we can offer them, prior to their arrival or upon arrival at the hotel, rooms in a higher category to enhance their experience and earn extra revenue for the hotel.
Price improvements for tight budgets
Negotiating with the customer and being flexible when they are on a tight budget is also key to differentiating ourselves from the competition and securing more bookings.
Creating a forecast
Creating a forecast is synonymous with making a sales estimate. Analysing our product and how it is affected by the average price, the category, the different types of rooms, the expected occupancy, the sales units (number of rooms). These variables are affected by online reputation, the type of client (families, couples, leisure, corporate, etc.) and the type of hotel.
Motivating staff to provide quality service
The hotel team should always strive to have the best possible attitude, even during the low season, where the workload is lower, the staff should be especially attentive in order to build customer loyalty. It is also a good time to get guests to leave good reviews on internet review sites such as Tripadvisor.
Connecting with the competition
Knowing at all times what the pricing policy of your competitors is will help you to stay well positioned in the market and make informed decisions.
At IHCS we can help you increase your hotel’s income, contact us!