Seven trending hotel news stories that will have an impact on your hotel Revenue Strategy.
1. COPYING OTAS IS PATH TO INCREASED DIRECT BOOKINGS
When it comes to revenue management, everyone’s got a list of things to do to beat the competition. In this case, a speaker at a recent conference offered 5 tips on how hotels can drive more direct bookings. The key, he said, is to copy some of the strategies employed by online travel agencies:
- Personalize guest data you have available and use it to build loyalty;
- As much as possible, segment your email list to produce personalized offers;
- Be sure your website is designed to make booking quick and easy;
- Solicit the next stay, even while guests are on property;
- Wisely use post-stay email marketing.
2. STRONGER FOURTH QUARTER FORECAST FOR US HOTELS
The US hotel industry might be headed toward a stronger fourth quarter, despite some performance softness projections for Q3, according to TravelClick’s September North American Hospitality Review.
While the group is projecting third-quarter declines in average rate and bookings for all business segments, those indicators turn positive in the final quarter of the year for both group business and transient business travel. According to a company analyst, “Over the past 60 days, there has been a noticeable increase in advance reservation pace, lasting well into 2018.”Is copying OTAs the Path to Increased Direct Bookings? + 6 #revenuestrategy trends Click To Tweet
3. MORE DIRECT BOOKINGS HAS A COMPOUNDING EFFECT
An increasing number of hotel owners and operators are paying closer attention to what it costs to acquire customers, which often leads to a discussion of direct bookings versus business from third-party platforms, e.g., online travel agencies.
Speaking at a recent conference, digital distribution guru Cindy Estis Green outlined how some operators are leaving money on the table through over-reliance on OTAs. She pointed out while guest-paid revenue grew 14% from 2014 to 2016, loyalty commissions grew by nearly 300%. Conversely, boosting direct bookings can have a compounding positive effect on profitability: If a hotel is worth $100 million in revenue, one percentage point in revenue capture is equal to $1 million, meaning a 2% to 3% shift in direct bookings will result in noticeable revenue generation without gaining a single new guest.
4. A SILICON VALLEY APPROACH TO HOTEL BUDGETING
The author’s premise is that Silicon Valley tech companies have a better way to approach yearly budgeting. Assuming that’s true, he offers 6 guidelines hotels can follow to, as he says, “differentiate from the comp set, win budget season and outperform.”
- Avoid a siloed approach and instead create cross-functional brainstorming teams.
- Deconstruct budget priorities and focus on fewer, more critical items.
- Take calculated risks and try new things, including tech-based systems.
- Rather than a cost-cutting approach, look for budget items that could create returns on investment.
- Embrace a culture of experimentation and leave budget to try new things.
- During stressful times, it’s more important than ever to set time aside for reflection and decompression.
5. A HOLISTIC APPROACH TO USING BIG DATA
Big Data has a lot of uses in hotel marketing and revenue strategy, one of which is to help determine the sometimes-elusive lifetime value of a consumer. The author provides four tips on how to better use Big Data as part of a holistic Revenue Strategy:
- Determine which specific travel consumers fit your business and use Big Data to identify the best opportunities to reach those people, draw them in and exceed their expectations.
- Analyze Big Data to identify peaks and dips in a business cycle and use that as a guide to develop Open Pricing schemes for goods and services.
- Capitalize on Big Data to anticipate travelers’ needs and tailor efforts to deliver to those who most need specific services during a given time period.
- Deeper analysis into what might appear to be unrelated information can yield insights that target a specific customer niche and increase sales.
6. HOW TO BEAT OTAS AT THEIR OWN GAME
Online travel agencies have a big advantage with the wealth of data they possess about travelers. Ironically, it’s travel suppliers — hotels, for example — that provide OTAs with this data advantage by providing inventory to these platforms. But the author insists that hotels can prevail in this tug of war if they employ technology-based solutions that gather, analyze and deploy the vast amounts of other data they collect from customers.
Hotel groups need to pool their vast “lakes of data” and work together to create personalized customer experiences that surpass any perceived advantages OTAs possess. As he wrote, “Technology shouldn’t be the advantage between hotels; it’s the application of technology that should make the difference.”
7. ACCORHOTELS BUYS TRAVEL AGENT BOOKING PLATFORMS
AccorHotels’ quest to diversify continues. The French hotel company purchased Gekko Group, owner of hotel booking sites that serve 14,000 travel agencies—a majority of which are French. Terms of the deal weren’t announced.
Gekko has two booking platforms that offer search and reservation solutions for agents looking to book more than 500,000 hotels worldwide. One site serves French travel agents, while the other focuses on corporate and government accounts. With the acquisition, AccorHotels will now compete with HRS, the Germany-based specialist, and Hotelbeds, the Spain-based wholesaler, in aggregating hotel inventory for resale by travel agents.
Stay up on hotel Revenue Strategy news and discuss industry tech trends in the Hotel Revenue Strategy Leaders Group on LinkedIn.
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Latest posts by Ed Watkins, Contributing Editor (see all)
- Technology Holds the Key to Personalized Rate Offerings - October 16, 2017
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- Employ Personalization to Increase Direct Bookings - October 9, 2017
Tags: 1:1 marketing, big data, boost bookings, cost of bookings, direct bookings, Duetto, hospitalitynet, hotel booking costs, hotel distribution, hotel pricing, Hotel Revenue Management, hotel revenue strategy, hotel sales and marketing, hotel technology, hotel yielding, OTA, Personalization, personalize, RMS, Tnooz, travel click