5 Tips for Managing a 360º Revenue Management Strategy
Revenue Management is constantly evolving.
It is important to adapt and implement specialized strategies that optimize resources and act on a client regardless of the context or platform used. Revenue management is the basis for the success of any hotel business. Without a clear strategy that enhances your visibility into clearly identified markets, it will be difficult to maximize revenue and position yourself against your competitors.
Taking advantage of 360º Revenue Management strategies allows us to analyze this phenomenon from different perspectives and to “attack” the potential client in the most appropriate way. This approach works by analyzing the product from the outside (potential customers, competitors and market demand) and from the inside out of the hosting (performance, systems used, resources allocated and process managers).
It is best to start from an overview in order to make the most representative decisions. We work from the customer’s point of view and for the customer. These will be the 5 pillars on which to base a 360º Revenue Management strategy:
Analyze the market.
We must begin with the most basic and then go on to make our analysis more complex. Determining which are the main connections in public transport or in transport by other means will be of great help to us. In addition, we will need to identify who are the main actors acting locally or when we may be more fragile due to seasonality. Through this information, demand patterns and target market segments must be extracted and, in turn, it must be possible to identify opportunities and challenges that must be addressed.
Identify the competition.
It is common for certain pricing decisions and marketing strategies to be based on performance or comparison over certain direct competitors. Therefore, it will be crucial to identify which these competitors really are. The most operative would be to extract different parameters about competitors, not only about their location but also about prices, product, segment, etc. This factor is vital as it can fluctuate seasonally or on days of the week. One of the keys will be to work with relevant information in real time, as it will be crucial to take advantage of and implement the value of this information.
Step in the traveler’s shoes.
According to a study conducted by the consulting firm study by Google people are using mobile phones at all stages of the travel cycle and the viewpoint on the traveller’s consumption of information and tourism products is changing considerably. It is important that, through information of this kind, managers test their own reservation systems, search for information and make a reservation as a pure user. In most cases it is the hotelier who is the last to know about your product as well as the system that precedes the reservation.
Know your product.
It is likely that your accommodation is offering a good product. However, your competition may be doing just as well or better. We must analyse and understand the needs of your target audience and see how satisfied they are. It may happen that a repositioning of the brand may be necessary, since we are off the hook with respect to the most competitive accommodations. Gathering opinions and entering into processes of continuous improvement will be a fundamental pillar to focus the product based on the opinion of the traveler.
Having a 360º approach means working collaboratively and involving all areas of your hotel, particularly sales, marketing, distribution and e-commerce. Addressing opportunities and challenges strategically, making changes in products and prices, betting on generating value, among other actions, will have a greater reach if we work as a team. This work will unify the message we want to convey. Working on pre-planned strategies will help us to make decisions without rushing, especially when the right people are the ones to help us get a complete picture of the accommodation situation.
Once we start from these 5 fundamental pillars, we will be prepared to propose a pricing strategy adapted to certain key factors. The product itself and the market situation require a 360º view of the business to make the right decisions at the right time.