Coping with COVID-19: Practical steps revenue managers can take through the coronavirus crisis
We’ve had the initial shock of cancellations en masse, bookings dropping off a cliff and the majority of staff sent home on furlough. But now that the dust is starting to settle from the coronavirus outbreak, it’s time to re-group and think about what short-term, practical steps we as hotel revenue managers should be taking.
We’ve put together a list of hints and tips of what to do (assuming you aren’t among the thousands on furlough) to guide you through the next few weeks.
Some may sound obvious, but as many properties are only just now shutting their doors now, it can be helpful to go back to basics and revisit some key revenue management fundamentals.
Record your data accurately
We revenue managers certainly love our data, and as we go through unprecedented events, it becomes more important than ever to record and learn from it.
Continue to record all cancellations due to COVID-19, both rooms sold and revenue, to ensure you have this data recorded correctly for pace comparisons next year.
Continue to produce your business on the books report as normal, as this will indicate the early signs of recovery in future months.
If you subscribe to STR, let them know if your property is closed so they can adjust the rooms available. There is no need to submit zeroes during the closure period, and keeping STR informed means your historical data will be correct.
Close out your property management system and/or your channel manager – this sounds like a given, but while some properties have physically closed, online they are still listed as selling for the period that they are closed which is potentially confusing or misleading for customers.
Get your forward strategy in place
The two segments likely to bounce back first are domestic leisure and corporate business, so make sure you are well prepared. There’s a high chance you may be asked to renegotiate corporate rates as travel budgets are likely to have been cut with businesses of all shapes and sizes being hit by the COVID-19 fallout, so price point is paramount. This recent article from Skift outlines common mistakes to avoid when re-negotiating corporate rates.
Domestic leisure travellers will no doubt be itching to get away after weeks of lockdown, but they may also remain very apprehensive regarding travelling, and levels of cleanliness at your property will be of upmost importance.
It’s expected that the summer booking window will become much shorter, as leisure travellers will hold off booking until the last minute and, as a result, your hotel may see a much higher volume of late pick up. With this in mind, products like advance purchase, which have always been in place to encourage early bookers, may not be as popular for the foreseeable months ahead.
For leisure guests, the two keys points in the short-term will be; flexibility to allow for last-minute changes, and value proposition, so add value and create bespoke leisure packages where you can. Invest in your digital marketing to help capture new audiences, and tactfully plan ahead.
Typically, forward rates are loaded for the next 12 months ahead, but to capture as much forward business as possible, make sure you have inventory loaded for the next 18 to 20 months. Of course, restrict and monitor any forward event dates once known. International markets, along with customer confidence, will rise as we move further through the pandemic, and will very much depend upon travel restrictions, so price in line with demand, and monitor pick up as you go.
MICE is likely to be the last segment to come back, as organisers will be more reluctant to commit to conferences and events, also, there's likely to be an ongoing question mark around social distancing, having said that, make sure you have your group strategy in place now for 2021 and 2022 to allow the team to effectively handle forward group enquiries. Make a note to check and review your group terms and conditions.
Systems maintenance
Take this opportunity to plan in those housekeeping jobs that always get left behind – you know the ones; tidying up and removing old rate codes, merging duplicate customer profiles, cleaning up the hotel database.
Review and update content on your website, tailoring it to new audiences, if applicable. Review room type descriptions, update images and check policies. Make sure you mirror these updates over to your main online travel agents, and develop your content score up to 100%. You want to be in the best position you can be, ready for the rebound.
Investigate new technology
This is something that can often fall off the radar in the hectic day-to-day of hotel management, but if you were unhappy with your PMS, booking engine, or channel manager before COVID-19 hit, then you’re still going to be just as unhappy with it post COVID-19. So now is the time to press ahead with researching new technology options, plan demos, ask questions and draw up your shortlist. There are a lot of vendors currently offering introductory discounts, so take the opportunity to make the changes, if originally planned, as this may actually save you money in the long run.
Knowledge is power
Read and learn, read and learn. Stay up to date with market trends and industry statistics, read well-informed blogs, and make sure you keep track of the cycle of the pandemic. Closer to home, monitor hotel closures and re-openings and, in particular, key changes within your competitor set. If you’ve always had a low-threat competitor, based on business mix, this may well change going forward, given the potential adjustments in market segmentation, so be alert to strategy shifts in other hotels as well as your own.
OTA Insight are sharing regular updates to show pricing patterns and behaviours across multiple markets, plus other invaluable analytical data, so stay in touch with your account manager, or get in touch via their website. There are one off reports available for key cities, such as Dublin, Edinburgh and Manchester that give collective insights into market rates.
STR are running weekly webinars to keep us all abreast of trends and market changes. You may also consider signing up to STR’s Forward STAR. This is completely free of charge and will give you insights into forward demand – see an example report here.
Shiji Group are sharing useful insights into China's recovery to assist other markets with predictions on economic recovery post COVID-19
And of course, keep yourself up to date via the World Health Organistaion's website for the most accurate and up to date information relating to the pandemic.
Green shoots
Recovery will come to the hotel industry and, when it does, we need to be absolutely primed for it. Making the most of the time we have now to reflect, recharge and ready ourselves could make all the difference to our ultimate resurgence.
If your hotel needs revenue management support, Octopus Revenue is here to help. Get in touch to talk through your options or for advice tailor-made for your hotel.
