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Become an Online Superstar

By Jean Francois Mourier 
August, 2012

Hopefully you have been reading my articles over the past few years and you’re familiar with my point-of-view: hotels who are not using the online channel to sell their rooms are losing out on valuable visibility and revenues.
 
Here’s why: consumers’ booking habits have changed. When planning for a trip, consumers don’t Google hotels within their destination; instead, they search on the OTAs. So if your property isn’t listed on the OTAs, then your customers won’t be able to find you. And if they can’t find you, they can’t book with you. So if you’re not online already, then stop reading immediately and get your property listed on at least one OTA. I said, “stop reading”!!
 
Now that that issue is taken care of, we can move on to today’s topic. Like with any other distribution channel, there are very specific ways to increase your bookings and revenues through the online channel. This article will show you how you can become an online superstar, a.k.a. earn the most revenue possible.
 
Don’t forget about your own property’s website
It is important to make sure that you are directing potential guests to your own property’s site instead of the OTAs in order to avoid the excessive commissions. Just like with pricing on the OTAs, hotels need to ensure that their pricing on the direct channel is optimized using the best revenue management system available. In fact, it can be even more important to have a sophisticated RMS managing your website rates because a property’s direct rates must be highly competitive to ensure that consumers are incentivized to book directly instead of through an OTA.
 
Inventory management
Inventory must be managed on the direct channel, just like it is on the OTAs. As rooms fill up, new allotments need to be distributed across all online channels. While this can be done manually, it is always more effective to use an automatic revenue management system that will update your inventory in real-time.
 
A word of caution though… one of the biggest mistakes made by revenue managers is to remove inventory from the OTAs when the hotel is approaching maximum occupancy. Many revenue managers theorize that if the property is already almost full, then they shouldn’t have to pay the high commission rates charged by the OTAs to sell the last few. So, they move all of the remaining inventory to the direct channel and hope that travelers will find the website on their own.
 
Instead, revenue managers should maintain the property’s presence on OTAs, even as the property is approaching maximum occupancy. In a consumer’s mind, if your hotel is showing as sold out online then your hotel must actually be sold out. Instead of going to visit your property’s website to see if there are rooms available, consumers will just book their stay somewhere else.
 
Incentives
I’m sure that you’re all familiar with the idea of sales incentives: giving away a free toaster for getting a bank account, a free TV for renting an apartment, a free room upgrade for booking direct instead of through the OTAs… Oh wait, you’re not familiar with that last one?
 
Well, you should be. Just like in any other form of sales, consumers must be incentivized to act in a certain way. Hotels should be offering incentives for consumers to book directly, especially since booking directly can often be more complicated and time-consuming than booking through an OTA.
 
Consider offering room upgrades, free food & beverage, cash-back rewards, free airport transportation, etc. for any guests who book through the direct channel. Promote the rewards on your homepage and on your booking page so consumers will be encouraged to take the time (and get the savings) of booking direct. While you may need to spend $5, $10 or even $20 to get that sale, isn’t it better than losing 30% of the total on OTA commissions?
 
So what are you waiting for? Optimize your online bookings with these tips and become an online superstar today!


Jean Francois Mourier is CEO and Founder of REVPAR GURU, a company that provides hotels around the world with an alternative revenue management software system designed to deliver maximum bookings and profits. As REVPAR GURU's custom-designed Yield Dynamic Price Engine is the only real-time revenue management system available on the market, it meets the rapidly changing needs of hotels in a very demanding business environment. REVPAR GURU’s system offers dynamic rate optimization, real-time pricing, integrated internet and extranet yield channel management and GDS sales distribution, to increase a hotel's RevPAR intelligently and effectively, while maintaining rate integrity and automated rate parity. Since 2004, hotels worldwide have used REVPAR GURU’s software system to increase occupancy and RevPAR. You can reach Jean Francois through www.revparguru.com or by calling 1.786.478.3500.
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Contact: 

REVPAR GURU INC. 
786-478- 3500 
www.revparguru.com

 

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Also See: Data Overload: Productive or Pointless? / Jean Francois Mourier / July 2012

Fighting for Your Property's Stars / Jean Francois Mourier / June 2012

Do You Hate the OTAs? / Jean Francois Mourier / May 2012

The Future of a Revenue Manager 2.0 - Part Human, Part Computer, All Profits / Jean Francois Mourier / January 2012

A New Year's Resolution? Automate Pricing Strategies to Embrace the Changing Face of the Booking Process / Jean Francois Mourier / December 2011

Big Booking Rates Brimming With Holiday Cheer: What the Good News Means For the Hotel Industry / Jean Francois Mourier / December 2011

Demystifying the Magical Pricing Potion / Jean Francois Mourier / November 2011

Getting Into Bed With The Enemy: Like Any Relationship, It Pays To Know Your Partner / Jean Francois Mourier / October 2011

Hotel Revenues on the Rise for 2011 Holiday Season / Jean Francois Mourier / October 2011

Shifting From Manual to Automatic in Revenue Management / Jean Francois Mourier / July 2011

Going with GOPPAR? Not so fast, RevPAR is still the best metric for revenue managers / Jean Francois Mourier / June 2011

Protecting Your Brand from Discounts; The Real Economic Impact of Losing Rate Discipline / Jean Francois Mourier / June 2011

A Tale of Two Strategies; Contrasting boutique and chain hotel revenue management approaches / Jean Francois Mourier / May 2011

The Great Debate: Humans vs. Automated RMS: Their strengths, weaknesses and what responsibilities are best suited for each / Jean Francois Mourier / April 2011

When Every Second Counts: Secrets for making the most out of the new last-minute booking trend / Jean Francois Mourier / April 2011

Rev Up your RevPAR In 4 Different Ways / Jean Francois Mourier / March 2011

Pricing Beyond the Comp Set And other new pricing strategies that really work / Jean Francois Mourier / March 2011

Schooled By Wall Street; Using stock market principles for optimum hotel revenue management / Jean Francois Mourier / February 2011

System Underload; Inefficiencies in RMS Systems are Costing the Industry Dearly / Jean Francois Mourier / February 2011

Revenue Management: Back to Basics: The Importance of Revenue Management Principles / Jean Francois Mourier / January 2011

Revenue Management: Profiting from the Industry’s Growth in 2011 / Jean Francois Mourier / January 2011

Home For the Holidays: Tending to Hotel Operations When Your Revenue Manager is on Vacation / Jean Francois Mourier / December 2010

The World of Revenue Management: Past, Present & Future; Looking back on hotel revenue management in 2010 and what the industry is expecting for 2011 / Jean Francois Mourier / December 2010

All Science, No Guesswork: The Benefits of Algorithms in Hotel Revenue Management / Jean Francois Mourier / November 2010

The Great Debate: Humans vs. Automated RMS: Their strengths, weaknesses and what responsibilities are best suited for each / Jean Francois Mourier / October 2010

Rate Parity vs. Rate Integrity—What is Rate Integrity? / Jean Francois Mourier / October 2010

A New Day For Timeshares; Using automated RM systems for running your timeshare company / Jean Francois Mourier / October 2010

Best Practices in Revenue Management, Part 3; Automation, Channel Management and Decision Making / Jean Francois Mourier / September 2010

Best Practices in Revenue Management, Part 2; Rate discipline, the leveraging of real-time information, and price prediction / Jean Francois Mourier / August 2010

Best Practices in Revenue Management, Part 1; General revenue management and strategic pricing / Jean Francois Mourier / July 2010

The Irresistibility of the Obvious; How a new trend in revenue management and metrics is missing the point / Jean Francois Mourier / July 2010

Pricing Beyond the Compset - And other new pricing strategies that really work / Jean Francois Mourier / June 2010

A Tale of Two Strategies; Contrasting boutique and chain hotel revenue management approaches / Jean Francois Mourier / June 2010

Historical Pricing Is History, Well, Not Exactly; Examining the Role Historical Pricing Should Be Playing in Hotels’ Pricing Strategies / Jean Francois Mourier / May 2010

Tipping Your Cap (Rate) - Why hotel owners need to pay attention to RevPAR / Jean Francois Mourier / April 2010
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