The other revenue variables

Setting prices is one of the most complicated tasks at any hotel establishment. Demand, competition and distribution are some of the variables that must be considered in order to offer rates that adapt to the needs of the market. However, don’t forget there are other variables that cannot be controlled and which directly affect the duties of the revenue manager.

Climate, policy, legality, culture and environment are some examples of factors that mean prices often fluctuate. You can’t do anything about them, except adapt to the circumstances and align yourself with them. They are the famous threats that can’t always be converted into opportunities. Whether you like it or not, it isn’t always possible to turn the enemy into an ally, and less so when facing situations where time is needed to make decisions but there is no time to be had.

This leads to a reflection on the importance of the destination in the image of the hotel establishment. It plays an extremely important role in the commercialisation of your services given it is a key factor in the purchase decision of any tourist, while the proposition seldom becomes the “leitmotif” for the trip.

As such, attractive tourist destinations become the main reason to travel, while less eye-catching destinations make sales an arduous task that often means prices need to be lowered, devaluing your services. However, consider the client will not want to pay more for less, nor will they pay less for more as they will be suspicious and question why some services are offered below their designated value at a specific moment.

Collaborating with destinations is a way of contributing to the generation of a tourism package of value: at the end of the day, we’re all in the same boat. Establishing common guidelines that enable the creation of an environment that adapts to the trends defined by clients is almost an obligation.

As such, you should check out the “Calviá” case. Perhaps this link will help… (minute 1:22 is the most striking part).