By Kevin Duncan, Senior Director, Strategic Commercial Initiatives at The Rainmaker Group

“Perhaps the most critical component for success of the modern enterprise is its ability to take advantage of all available information both internal and external.”1

This quote captures the essence behind an increasing emphasis on business intelligence (BI) among the world’s top sectors. An emphasis that stems from the exponential growth of data now created and collected in organizations, with no signs of a slowdown. The International Data Corporation predicts that the collective sum of the world’s data will reach 175ZB by 2025.2 Unfortunately, many hotel owners don’t yet understand exactly what business intelligence is or why it’s important for their business success.

At every level of the hospitality industry, we often lack relevant, timely information. Hotel revenue managers attempt to address these deficiencies through manual methods and by creating Excel spreadsheets to share throughout the organization. However, revenue managers often work so hard at producing the information – operating as report generators – they lack time to actually consume the information. It’s this need that fueled the genesis of hotel BI.


Human decision-making works best when it’s underpinned by a solid foundation of fact. Throughout the late 1960s and mid-1970s, a variety of “decision support systems” (DSS) were developed.3 Driven by technological advances and growth of the Internet, DSS evolved and expanded into today’s BI: An automated way to collect data from disparate internal and external sources, and transform it into easy-to-understand insights that allow a user to analyze and make informed decisions improving business performance.

Within the hotel industry, an effective BI tool gathers data from the systems we use to run our business – revenue management, property management, point-of-sale, reservations, sales, and catering – analyzing and integrating it with information from external sources, such as competitive benchmarks and market data. With a few clicks of a mouse, technology then serves it up in the form of dashboards, reports, and graphic visualizations that allow hotel management to quickly identify where opportunities exist within their business and develop strategies to increase revenues and reduce costs.


As the hospitality landscape changes,4 BI is transitioning from “nice to have” to a “competitive necessity.” And savvy hoteliers are using specific tools within the BI arsenal to improve overall business results. BI used to focus primarily on historical data but can now incorporate real-time data, providing up-to-the-minute results on what’s happening at your hotel.

BI can help hotel owners understand guest-related trends, such as how they make their reservations and what room types they tend to book, as well as how and where they’re spending money. Customer data can be organized by market segments, and broken out by geography, demographics, lead time, and more. You can also better manage distribution channels, using analytics to determine whether, for instance, the return on value from a specific OTA channel is worth the investment.

Speed and accuracy are critical factors for profit optimization. With a modern BI tool, you can get granular very quickly, juxtaposing and analyzing data from a myriad of sources to provide actionable insights. Accelerate revenue growth by understanding who your most valuable guests are, then integrating customer lifetime value data into inventory-related pricing decisions. Identify market segments that are underperforming – all the way down to the rate code level. And spot upcoming issues that may affect pace, allowing you to take corrective action before they occur.


While Gartner data shows that more than 87 percent of organizations have low BI and analytics maturity,5 the future of BI innovation in the hospitality industry is bright. Newer solutions provide hotels with ways to differentiate themselves from their competition, reach new markets, identify new revenue streams, and test out different strategies before implementation.

Cloud-based systems provide mobile access, anywhere in the world, at any time. Managers can view key performance metrics such as P&L, budget variances, demand forecasts, revenue, occupancy, and pace reports in real time, as well as more advanced metrics, such as revenue per guest, and revenue per source market. This allows you to make better business decisions using the most up-to-date revenue and operational information.

One capability harnessed through BI, that hasn’t yet gone mainstream, is BI’s scalability. To quote an old BI adage, “what gets watched gets done.” Next-gen BI gives context, clarity, and insights to every employee, offering multiple reporting options customized to meet the needs of each hotel team. It stops departments from operating as independent realms, instead giving them the ability to tie department metrics into the overall business strategy, and fundamentally changing how your hotel competes in the marketplace.

Operations & Staffing

Today’s travelers expect highly personalized experiences, leading to greater loyalty and increased revenue – with 40 percent of U.S. consumers saying they purchased something more expensive than they planned to because of personalized service.6 Advanced BI allows you to track guest information regardless of communication channel. This information can then be utilized for upselling and customizing a guest’s stay. The new breed of BI tool provides timely access to relevant information that improves operational and financial performance. It lets you track costs, monitor supplies, adjust staffing, and reduce unnecessary spending.

Sales & Marketing

Group business is pacing up this year, and it’s an important niche for many hotels and resorts.7 However, group sales must coincide with marketing for transient business. When used in conjunction with a group revenue management tool, BI can provide real-time revenue breakdowns and cost analysis of past and on the books room nights and revenue, helping you optimize group pricing for each piece of business and streamline the complex process of group business management.

BI will also allow you create more intelligent marketing campaigns. You can perform in-depth analysis of guest spend patterns, booking patterns, production by selling channel and room type – valuable information that helps your marketing team design campaigns that will achieve the highest conversions. You can use booking pace to determine need periods. And by analyzing geographic source markets in combination with lead times you can more effectively time your seasonal promotions. In addition, loyalty programs can be very effective, but they can be extremely expensive due to the rewards being offered. BI allows hotels to evaluate the cost of rewards in conjunction with loyalty member purchase history, allowing decision-makers to select rewards with the greatest ROI.

Case studies among other industries attest to how BI implementations have allowed some organizations to transition from floundering to flourishing. And hotels are poised to gain big payoffs from BI as it becomes a key priority among hoteliers looking to gain a sustained competitive advantage in the coming future. With BI’s broad perspective of all your business data, you can analyze and strategize most aspects of hotel operations from revenue management to front desk management, making impactful improvements in revenue optimization and profit growth.