Hotel revenue management systems
It’s very likely everyone will be using some kind of technology system to manage their hotel and price their rooms in the next 10 years. Many solutions already exist to help with this. Of course, one of these is a revenue management system or RMS.
Some leading RMSs include:
- BEONPRICE
- Duetto Edge RMS
- EasyRMS
- guestrev
- HotelPartner Yield Management
- Hotelsdot
- IDeaS
- LodgIQ
- MaxEngine
- Rainmaker
- RateWise
- RevPar Guru
An RMS is a software that enables you to carry out important revenue management tasks more efficiently and effectively. It helps to handle and make use of all the data your hotel produces – as well as the market at large – in order to help you to make more informed decisions.
Without continued dissection of the information, rooms and services may be frequently overpriced or underpriced, leaving your hotel a step behind local competitors and confused about the profitability of the business.
This type of inconsistency can lead to a problem for the entire market. For example, if a hotel is constantly under-selling on the expected rate, it might inadvertently create a price war in their confusion because competitors may react in kind.
Here’s how revenue management technology can help:
1. Less costly errors
While larger hotels might be able to hide or easily overcome a pricing mistake, smaller hotels have less margin for error. An incorrect price at a small hotel will have a bigger impact on ADR and RevPAR.
2. Get more revenue out of every room
With fewer rooms, maximizing the rate for each room becomes more critical. The data your technology provides will help you understand who you should be targeting and when. What will be the most valuable demand for you? For example, do you offer rates for group business? Do you offer discounts for long stays?
3. Know your competitors better
To get your own pricing strategy right, you need to know what your immediate competitors are doing. With a pricing intelligence tool, you can get an instant all-in-one overview of your competitor’s rate activity, meaning you can concentrate on why they are adjusting and how/if you should respond.
4. It makes your hotel ‘bigger’
Large, branded hotels will already have an RMS in place – and dedicated revenue managers to manage them – and while independent hotels may not be able to afford a robust solution, pricing intelligence tools are an affordable substitute. These use the data and its own algorithms to carry out a real-time analysis of the state of the market, and of demand, in order to calculate ideal room rates. Increasing your data visibility and analysis capabilities give you more ammunition to compete with large hotel groups who are able to devote full-time staff to revenue management.
5. Manage your time efficiently
Automated market intelligence will allow you to instantly access and act upon pricing data. Knowing when the market will be an easy sell-out or in a quiet period will not only enable you to optimize rates but with a dependable forecast, you can organize your staff more effectively and improve the guest experience.
6. You can be proactive
The more data you have access to, the less reactive you’ll be. Rather than reacting to your competitors all the time, you’ll better understand demand, make your own projections, and set intelligent rates.
7. Understand your guests better
an RMS can tell you more about customer behavior and allow you to attract more bookings. For example, do guests prefer it when your rate applies to every night of their stay, or will they accept varying rates, or do they prefer a total stay price?
8. Your data will come from a single source
Instead of combing through your own data, and then individually doing the same for competitors, and RMS will collate everything for you in one place. Depending on your system, you can do this for up to 15 competitors. If you are a smaller hotel that is new to revenue management strategies, doing everything manually might have you tearing your hair out.