March 30, 2010

Revenue maximization strategies for independent hotels


With the right investment in processes, technology and staff, it's possible for independent hoteliers to carve out a place for themselves in the industry. The smaller scale of operations means that independent hoteliers are nimbler when instituting change and can react quickly to a dynamic and changing market.

By Klaus Kohlmayr, Senior Director IDeaS Advantage

Independent hoteliers often find themselves in a tough position - they often don't have the resources to compete with the big chains in terms of marketing budgets and investment in third party booking channels, or the well recognized brand name that goes hand-in-hand with these activities. However, there are a number of strategies that independent hotels can implement now to ensure that they are maximizing their revenue and securing customer loyalty for the future.

It's important as an independent hotelier, to maximize the ROI on all of your resources. Utilising data that can be collected from smaller, independent operations is a cost effective way to determine the best rates for the upcoming months and building strategy around it. Independent hoteliers need to ensure they have detailed data that is both historical and forward looking. Historically, the data should include (at least) the number of occupied rooms, coupled with revenue by Market Segment by day. Also ensure that number of rooms and revenue on the books by day (and by Market Segment) for at least the next 90 days is included. If data is collected every day it will allow the hotel to establish simple booking pace forecasts by segment and day of week, from which they will be able to compare to historical data. If this is done consistently it will allow hoteliers to quickly pick up any changes when demand picks up and enable them to tweak their strategies accordingly.
It is becoming apparent in the hotel industry now that independent hotels need to focus on gaining a better understanding of all group activity and revenues - while it is important to have group