The task of monitoring and increasing the average price is one that should be carried out very carefully by the manager or general manager. Of course, it is essential to always involve the entire hotel team to ensure efficient implementation.
Nowadays, there are many tools and strategies available to significantly increase our revenue in the hospitality industry. These techniques go well beyond simply raising the average price, and in this article, we’ll explain some of them.
What can we do to improve our average price?
First things first: the hotel’s website (we recommend reading our article on effective hotel website design as well as the article about the booking engines on our website ).
There is no doubt that a website is the most profitable channel for any business. By “profitable,” we mean, above all, that selling through your own channel eliminates the costs associated with commissions and intermediaries. That is why it is very important to invest time and resources in this valuable sales channel.
The increase in sales through our website leads to:
- A positive impact on our income statement.
- Increased cash flow and a reduction in our debt, which minimizes risks.
- An improvement in profitability per room or GOPAR (gross operating profit per available room).
- Support in selling the hotel’s ancillary services, which in turn leads to an increase in our TREVPAR (Total Revenue Per Available Room).
- It also helps in building a robust database, which in turn simplifies the work of those responsible for CRM.
- In many cases, it helps us speed up the check-in process.
Social networks and internet communication
These days , having a presence on social media and a strategy for managing it is practically vital. Facebook and Twitter are important, but you shouldn’t forget the numerous other channels, such as TripAdvisor, Foursquare, YouTube, and local websites or blogs.
Communication over the Internet takes place everywhere, which is why it’s important to ensure that someone is monitoring the various channels of communication between customers and businesses at all times. Even at small hotels, revenue managers often don’t have time to monitor social media, which is whythe role of community manager will become a basic necessity in the coming years. Anyone who doesn’t use social media to their advantage will be at a significant disadvantage compared to the competition.
Online Reputation
We should pay special attention to our online reputation, especially considering that social media has a decisive influence on people’s purchasing behavior in 51% of bookings.
Here are some statistics to keep in mind, according to TripAdvisor’s TripBarometer:
- 93% of travelers from around the world say that reviews influence their booking decisions.
- 51% of travelers worldwide post their own reviews of their accommodations after a trip.
Better Relationships, Better Returns
One of the key factors in the world of hotel revenue management today is relationships. We shouldn’t try to do everything on our own. It’s important to invest time in building close relationships with all of our sales partners, including travel agencies, tour operators, and corporate clients. Relationships are essential. So don’t hesitate to invest as much time as necessary in this crucial aspect of any marketing plan.
Set Goals and Budgets Early
Now is the time to set your revenue management goals and the budget for the coming year. It’s important to set the budget in a timely manner and try to anticipate every possible problem and setback before they occur.
To set goals and budgets as effectively as possible, you should use at least the last two years as a reference, if possible.
Make sure to consider all the points raised in this article and incorporate them into your cost breakdown, including SEO, PPC, and social media strategies.
Creating a Culture of Revenue Management
Revenue management offers numerous benefits to the organization that implements it. Many of these benefits are economic in nature, but not all of them.
To successfully implement a revenue management culture in a hotel or resort, it is essential that the entire team be involved and supported, and that they are trained and motivated. This culture not only helps improve the average rate but also increases occupancy. As a result, we improve both RevPAR ( revenue per available room) and TrevPAR ( total revenue per available room). In our next article, we’ll discuss revenue management.
A Good Business Plan
This is the difference between marketing a hotel and implementing revenue management. More specifically , the sales department generates demand, while revenue management manages it.
The most important thing: service quality
If we manage to maintain a high level of service quality—which always starts with a good work environment—this will have a positive impact on our occupancy rate and, consequently, on our average rate. Not to mention our reputation, both online and offline.
We shouldn’t forget that we’re selling experiences, especially at vacation hotels or resorts. A hotel that doesn’t focus on service quality, foster a positive work environment, and implementprocedural standards or train its staff will hardly exceed customer expectations.
In this article, we’ve explained what we consider essential for improving our average price while establishing a firm foothold in the market. In this way, we’re working to improve results in the short term while simultaneously building a business model with strong medium- and long-term prospects.
In our next article, we’ll discuss the importance of a strong revenue management culture in an independent hotel or resort. We’ll explain the benefits of such a culture as well as the factors to consider when fostering it.
We hope you enjoyed this short article and that it helps you with the challenging task of increasing the average price at your hotel or resort. If you found this article helpful and interesting, please share it!
