December 02, 2011

The changing face of hotel revenue management


Online reviews and social media are becoming increasingly important to selling rooms. Revenue Managers have long looked to STR data for quantitative metrics to help determine pricing but today they’re beginning to look at including qualitative metrics in their pricing strategy.

Many traditional aspects of marketing have moved to revenue managers who are tasked with determining the right channel and price to sell inventory. But there are other trends that are changing the face of revenue management.

Online reviews and social media are becoming increasingly important to selling rooms. Revenue Managers have long looked to STR data for quantitative metrics to help determine pricing but today they’re beginning to look at including qualitative metrics in their pricing strategy. They are asking themselves, “Are my customers happy? Are they loyal? Do they tell their friends and networks about the experiences they have at our hotels. What are people saying about our competitors.” Whereas these metrics used to be hard to quantify, today they are easily measured and readily available in ORM (online reputation management) services such as Revinate.

Today, consumers are spending more and more of their time on social sites such as Facebook and TripAdvisor. A large part of what they’re doing on these networks is sharing user-generated content in the form of reviews, photos, videos and comments. Because the goal of revenue management is to maximize revenue many hoteliers are actively working on their social media strategy knowing that if they can engage and capture guests on their own Facebook page or through Twitter and have them book directly, the acquisition cost is lower than through an OTA. These efforts are validated by a recent Bain & Company report that shows that customers that engage with brands on social media are more loyal and spend up to 40% more than other customers.

Get the full story at the Revinate blog

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