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What does the future look like for revenue management?

Hotel revenue management, and in particular the role of the revenue manager, has undergone some seismic changes over the last few years. Gone are the days of the revenue manager poring over an Excel spreadsheet, compiling data to identify trends in hotel rates for rooms that were booked through either travel agents or direct phone calls.

These days, successful revenue analysis involves so much more – the digital age has seen a massive shift in the way in which we can collate and analyse information, as well as the data that’s available for us to use.

Online travel agencies (OTAs) and mobile marketing have had huge impacts on the way consumers now search for and book their hotel stays, and the hotel revenue manager has had to keep up with these changes.

So in this fast and ever-changing world, how can we predict what’s next for revenue management?

Bigger opportunities for smaller hotels?

A lot of smaller hotels have found it tough to compete with the big chains over the past few years. Massive advertising budgets that dwarf anything an independent can put aside mean it’s always going to be a struggle to be seen as easily.

But smaller hotels could see themselves gaining something of an advantage over their Goliath rivals in future. Smaller hotels are able to respond much more quickly to developments – big chains tend to have less flexibility.

So hotel revenue managers who keep their finger on the pulse could take full advantage of the ever-increasing power of internet search engines such as Google and metasearch channels like Trivago and Kayak. Continually tracking and updating SEO and SEM data and making sure your website is fully optimised to drive direct sales is just one way that smaller independents will feel the benefit of a tech-savvy hotel revenue manager.

With the world at their fingertips, consumers are able to be far choosier about where they splash their hard-earned cash. Hotels that have something unique, new or trendy to offer will always appeal to the discerning traveller – qualities that chains with large numbers of properties to manage will find difficult to satisfy. So hotel revenue management that can strike the right balance between human intuition, SEO technology and website analytics will increasingly have the edge over the competition.

Rise of social media-savvy revenue management

Social media is yet another revenue channel that continues to evolve and grow in popularity and power. While many hotels do well at generating interest and conversing with their target audience through social media, few have yet managed to monetise these opportunities.

Being able to channel the right marketing at the right audience at the right time through social media will become more and more relevant to the hotel revenue manager’s role in the future. So again, the revenue manager who can keep up with evolving technology and behavioural trends could be the making of smaller hotels.

Hotel revenue management – more than just the right room rate

In the past, revenue analysis has been restricted purely to the price that rooms are sold and booked at. But this role is likely to change and grow in future.

Revenue management encompasses much more now and includes revenue streams such as a hotel’s function space, spas, restaurants and other facilities. This means the revenue manager of the future would take a more holistic view, focussed more on the total revenue available per room, rather than simply looking at basic sales.

One thing is for certain: the hotel revenue management of the future will continue to be a central element to the success or failure of a hotel.

Is your hotel geared up to ensure your revenue managers can meet the challenges head-on? Octopus Revenue’s revenue management training courses and reveune management services could help to future-proof your hotel profitability. Get in touch or take a look at our training calendar if you’d like more information on how we can help.

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