Seven trending hotel news stories that will impact your hotel Revenue Strategy.
1. HIGHER ADRS IN 2017? IT’S UP TO REVENUE MANAGERS
Global hotel rates are forecast to rise 3.7% in 2018, according to a new forecast. Whether those aggressive increases come to fruition depend on economic factors but also the bravery and moxy of revenue managers to push rates in times of general global uncertainty. Are you up to it?
The forecast calls for European hotels to post the largest increases with other regions are barely keeping up with inflation. Prices are expected to fall in Latin America and the Caribbean. The forecast is a little more tentative in North America where higher levels of international inbound travel and stable economies are leavened by higher numbers of hotel openings.
2. IT’S IMPORTANT TO CUSTOMIZE COMP SETS BY SEGMENT
The author suggests it’s bad revenue strategy to use one comp set to analyze all segments of business a hotel generates. Since a hotel doesn’t compete with the same set of hotels for every channel, it is important that each competitive set is customized to suit the appropriate nature of the guests in each respective channel. Actually, it seems like common sense.
The detailed example the author uses shows the importance of selecting the right comp sets and comparing specific types of business individually for benchmarking and optimizing a hotel’s performance.DORMs: The time is now to be driving drive rate #revenuestrategy Click To Tweet
3. HOTEL OWNERS GRIPE ABOUT COSTS OF CHAIN LOYALTY SCHEMES
As hotel brand companies step-up their loyalty program efforts, some owners wonder about the balance between the costs and supposed benefits of these schemes. A panelist at a recent conference said, “As an owner, the question is, ‘How much more money will it cost us to get our guests?’ As the brand increases what it’s giving the guest, that’s not just out of charity. The people paying for those gifts to guests is the owners.”
Other owners on the panel bashed chains for their aggressive loyalty programs. Some said it’s part of their consideration of what brands to put on new and rebranded hotels. Others said owners need to personalize their properties as a way to build loyalty among their customers.
4. HIDDEN RESORT FEES COMPLICATE REVENUE MANAGEMENT
With the inauguration of a new administration in D.C., the heat is off those hotels that fail to completely disclose resort fees to guests during the booking process. While several states are looking into the practice, the FTC has stopped an investigation into hotels that don’t disclose or mask resort fees until a consumer is well along in the reservations process or in some cases, has already booked a room.
According to new research, 1,026 hotels in the U.S. levy so-called resort fees on guests. That’s up 14% from six months ago. The average resort fee is $21 per day. While resort fees create complications for guests, it also clouds the revenue management process in a number of ways.
5. HILTON HINTS AT NEW CANCELLATION POLICIES
In a call with stock analysts, Hilton Hotels Worldwide CEO Chris Nassetta downplayed issues with corporate travel managers over the company’s recent decision to enact a 48-hour cancellation policy. Nassetta said Hilton has had discussions with its corporate customers and that “reception has been perfectly fine.”
On the same topic, Nassetta hinted the brand company is testing a new room rate structure that will enable more flexible cancellation policies. Also on the table is a range of rates tied to cancellation policies as far reaching as 7 days.
6. IS GOOGLE READY TO DOMINATE TRAVEL DISTRIBUTION?
It’s a story that gains traction every six months or so: Is search giant Google ready to switch from being the matchmaker between travelers and suppliers to becoming a booker of airlines, hotels and more? No one seems to really know.
However, more than one expert believes some factors are in place for Google to potentially “flip the switch” from an advertising channel to a full-service distribution platform. Google currently integrates data with every travel provider, and the rise of voice-assisted search and chatbots could make the process more seamless. All that’s lacking, so far, is Google’s willingness to enter the fray.
7. PRICELINE CHIEF OUTLINES COMPANY’S PLANS
In a wide-ranging TV interview, the CEO of Priceline Group flicked away accusations that somehow it and other online travel agencies represent a monopolistic threat to the hotel industry. In another breath, he spoke of the significant reach and power his stable of OTA sites possesses. And he believes hotel owners and operators actually love OTAs, which does ring true.
He also reiterated previous reports that Priceline’s sites are building out their capabilities to book accommodations at vacation homes and other Airbnb-type rentals.
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