What are the biggest revenue management opportunities?

This article is part three of a three-part series on revenue management. Part one can be found here and part two can be found here.

Direct bookings will continue to be a big theme for 2017, giving hotels the opportunity to think differently about how to grow. It is not necessarily about marketing more aggressively but about marketing more resourcefully with forward-looking demand intelligence, according to Sanjay Nagalia, COO of IDeaS Revenue Solutions.

“As new data becomes available and integrated into revenue-management technology, it enables hotels to strategically target guests with personalized messaging and experiences,” he said. “Hotel can create attractive packages available exclusively via direct channels that provide more value to the guest and drive more business as direct bookings. “

Dom Beveridge, EVP of demand generation for the Rainmaker Group, agreed that data will provide the biggest opportunities this year for revenue management. “Hotels can benefit from the ability to use data to find solutions to demand problems instead of just dropping the price,” he said. “If you understand what’s driving the demand trends, you can make better decisions.”

Virtual Event

HOTEL OPTIMIZATION PART 2 | Now Available On-Demand

Survival in these times is highly dependent on a hotel's ability to quickly adapt and pivot their business to meet the current needs of travelers and the surrounding community. Join us for Optimization Part 2 – a FREE virtual event – as we bring together top players in the industry to discuss alternative uses when occupancy is down, ways to boost F&B revenue, how to help your staff adjust to new challenges and more, in a series of panels focused on how you can regain profitability during this crisis.


Using newer analytics around competitive intelligence will be a big opportunity this year, Beveridge said. While rate shopping has been around for decades, the newer tools that make it simple to understand things like fluctuation in local market pricing will put revenue-management decisions in the hands of operators.

“Those analytics previously were for upscale hotels but are now available to midscale hotels,” he continued. “It allows building of basic decision capabilities on rate-shopping decisions—really impactful decisions are made much simpler.”

Moving beyond revenue management to predictive analytics was the choice of two-fifths (40 percent) of respondents as the most important strategic change in their area over the next three years in a recent Hospitality Sales & Marketing Association International survey, “Portrait of Revenue Management Leadership.”

Nearly one-quarter (24.4 percent) selected fully integrating revenue management with sales and marketing closely followed by consolidating revenue management into business strategy (22 percent). Less than one-tenth (9 percent) chose other, while aligning revenue management with IT was selected as the least important strategic change among revenue leaders.

Today’s hotels need to optimize both revenues and profits—and one area with significant impact is managing costs associated with bookings, Nagalia said. Understanding and reporting on these costs will help optimize them through a sound channel performance strategy.

“Advanced analytics that optimize profitability will enable hotels to leverage all channels to the fullest potential for the hotel and increase overall profitability,” he said. “Managing hotel business by profitability, and aligning revenue management and marketing teams with this goal in mind, leads hotel owners and asset managers to the best results.”

Suggested Articles

Lodging owners who have the appropriate resources and capital have an opportunity to renovate at an accelerated rate and at more competitive prices.

The £18.4 million fine stems from a data breach discovered after the company purchased Starwood Hotels & Resorts Worldwide.

There are both positive and negative aspects to utilizing preferred equity capital, but it is often the best way to maintain ownership of the asset.