The Growing Number of Channels Leads to Growing Complexity of Revenue Management and a Need for Convergence Among Disciplines
By Michelle Woodley President, Preferred Hotels & Resorts | October 20, 2013
You see the headlines more often these days... "A New Hotel Booking Site Brings…" "8 Cool New Tools for Finding the Perfect Hotel"... Whether you are an industry executive or consumer interested in travel, hardly a day goes by without another headline about a new tool for bookings or the news of a site to go to for the best hotel deal.
The hotel distribution landscape is complex and ever changing. It is an elaborate web of disparate systems and integration admired from afar and challenging even for those involved in the day-to-day management of a hotel. Revenue Management is one aspect in particular that is vital to understanding and managing this intricate web. And it cannot be done alone or in a silo. The perspectives and skills required for effective revenue management have escalated and demand input and cooperation across disciplines such as operations, marketing, sales, and distribution.
Hotel Revenue Management is no longer a straight-forward look at historical booking data, future guest demand, occupancy, rate, and room costs for transient guests. Total Revenue Management requires a converged effort across many hotel departments. We must look at the total potential spend of a guest, including food and beverage, spa, golf, business center, etc., and to do this for every guest, not just transient travelers. Alongside revenue, we need to consider costs like operational expenses and the marketing and promotional efforts to get the guest into the hotel. The increasing number of channels – including the management of each and their relationship to each other – are important aspects for hotel operators to consider when setting a revenue management strategy and creating the organization to manage it effectively.
The subjects and commentary below specifically address channels, channel content, channel integration and attribution as it relates to the transient segment. These topics relative to groups pose additional channels for inclusion and additional disciplines to participate in the hotel's Revenue Management Team.
IDENTIFYING CHANNELS AND CONTENT DISTRIBUTION
It is impossible to determine exactly how many channels are available to a hotel (and consumers) today. They can, however, be categorized in order to make the conversation manageable.