Many hotels today still either do not estimate demand or only forecast up to the physical capacity of their hotel. Because anticipating total available demand provides a much clearer picture and more opportunities to improve pricing, the ability of a revenue manager or revenue management system to add in data sets that look at “unconstrained” demand is on the surface innovative and appealing. So here’s what hoteliers have tried thus far. Through statistics classes and Excel modeling, revenue management students are learning to calculate and measure demand through “synthetic unconstraining.” It’s similar to how ski jumpers forecast their takeoffs or how military personnel use data to predict the trajectory of a missile. The faster and farther out the pickup, the larger the demand estimate. Hotels then began using another source of data to estimate total demand: regrets and denials, tracking the number of people who called the hotel or call center but did not book. While this data helps, the downfall is often inaccuracies in how the data is recorded and the errors in estimating potential conversion percentages. So, with some or even all of these efforts in place today, hoteliers are convinced they are able to accurately estimate demand beyond the capacity of their hotel. And that’s where we are: “Unconstrained demand” is all the rage, but does little to drive rate. Get the full story at Duetto