Time is one of the most valuable elements for a revenue manager, meaning the automation of procedures and processes can make the difference between slow and costly daily planning and agile, profitable planning.
There is currently a series of technological developments available on the market, the functions of which will help you to define your hotel’s pricing strategy, bearing in mind that:
- setting the rates of your rooms is crucial if you are seeking to increase your direct sales
- their design doesn’t depend merely on OTAs; they also depend on your competitors
In this regard, we are well aware of the importance rate comparison tools hold for hotel establishments. The automation of services along with the proliferation of establishments has converted travellers into tireless price seekers and you cannot afford to be “left out” when your offer meets their needs.
Here are 3 functions you must have if you wish to continue optimising your income.
Calculation of rate variations
Being aware of the variations in rates with regards to your competition during a set period of time enables you to understand the trends of your reference market.
In addition, once you have defined “where” and “with whom” you are going to compete, the second step is understanding the trend in terms of rates, basing your decision making process on real data and enabling you to decide on the position you want to occupy in your relevant market.
This calculation, which can be performed daily, can be rather laborious, which is why automating the process becomes a key feature that will contribute to an improvement in your results, avoiding unnecessary searches and making your hotel’s revenue management process more dynamic.
Price difference
As for calculating price differences in relation to the competition, this will allow you to fully understand your positioning, among other aspects, as you will be able to see how prices are changing in real time for the establishments aimed at your same target market.
Automating this function will save time and definitely optimise your revenue management, facilitating decision making (like the previous feature) and enabling you to add value to what you offer and increase or decrease prices when you believe the difference is considerable.
Remember, “It is foolish to confuse value and price”.
Average price
The calculation of the average price won’t be a problem either, if your rate comparison tool does it for you.
Knowing the average deviation of your rates from those of your competitors will enable you to find out definitively how the market moves, assessing whether your pricing strategy is the most appropriate or if, on the other hand, you are priced higher than what the consumer is willing to pay.
Likewise, it will inform you as to whether you have a margin for increasing your rates, after checking that the market is willing to pay more for a night at a hotel with the same characteristics.
In this particular circumstance, you decide if you would like to increase or decrease your rates.
More information: http://www.paratyseekers.com/#priceseeker
Paraty Tech & Tour Blog 