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How Personalised Pricing Can Improve Demand and Revenue for Maldives Resorts
By Murphy Mathew
Tuesday, 27th February 2024
 

Hotel and resort operators in the Maldives manage complex businesses, they face ongoing issues related to volatility in occupancy, having overwhelming amounts of data and complicated revenue streams.

Coupled with these challenges are increasing demands from guests who seek personalised out-of-home experiences.

Personalisation can directly influence guest satisfaction levels and profit improvements when applied correctly by hotels and resorts.

While hotels that offer high levels of customer service have been practicing ways of personalising a guests stay once they are at the property—be it through suggesting a restaurant booking that may match a return guest’s interests—less is being done to personalise a potential guest experience at the initial booking phase.

Hotels can no longer compete on standardised pricing strategies

The commoditisation of accommodation products is currently at its peak. If guests’ book via travel portals or Online Travel Agencies (OTAs), the direct comparison of identical offers no longer shows the subtle or significant differences between hotels. Apart from the price, the offers are barely distinguishable.

In the current model, rooms are priced as units and rates are determined by demand and availability. OTAs then display these rooms in a side-by-side, competitive marketplace format where little information is provided about any of the distinguishing qualities each unique room may have to offer.

For instance, if you’re shopping for a king room at a five-star hotel with ocean views and a guest comes across three similar listings, they’ll most likely opt for the lowest-priced option—or maybe the one that allows free cancellation. What the booking channel can’t tell the guest is that there’s an available room with stunning sunset views that would really make their Maldives vacation an unforgettable experience – If only the guest knew.

For resort operators, this opens new opportunities to create and engage personalised guest products to differentiate themselves in the market and attract guests based on what they actually want. For example, does the guest want a balcony, a view, a breakfast? These are all wishes and preferences that are often prioritised ahead of the price. To personalise their experience, the customer is more likely to want to buy individual attributes than a specific room type. Giving the guest the ability to choose what they want means the hotel must have an individual price for every combination.

Hotels and resorts have access to extensive datasets today beyond their own booking systems, such as Google analytics or data trends related to customer search and buying behavior. These further provide hoteliers with the opportunity to personalize the offerings based on the target market, and consequently also adopt marketing strategies specific to channels.

Through a personalised approach to pricing, hotels can dynamically price any component based on the customer’s needs. This not only helps hoteliers monetise the guest experience, but also increases the choice and level of personalisation to support guest comfort and satisfaction.

Understand guest demand drivers

Resort operators need to personalise and proactively influence revenue opportunities throughout the customer journey. Those hoteliers who don’t take this approach risk business, with research showing 81 percent of hotel customers would be willing to switch their loyalty for a more personalised experience.

Understanding the customer begins at the dreaming stage – with 57% of travellers feeling brands should tailor their information based on personal preferences or past behaviours right from the beginning. And to better understand guest desires, the ability to build an accurate picture of their behaviour based on data is key. Data from booking channels, room-type preferences, dining choices, spa bookings and loyalty programs can help hoteliers better understand their guests so that more tailored packages can be developed that inspire return business.

Some hotel and resort owners are even using wearable technology today to provide added convenience to guests and collect valuable data. For guests, wearable devices provide access to an extra level of convenience. But for the hotelier, it provides a wealth of digital information on customer preferences that allows them to target customer needs, wants and desires in future encounters.

Personalised pricing can benefit both the buyer and seller

Today’s guests may appear to be fixated on price, but really, they want more than just a place to sleep, and whatever it is they desire, they want the highest quality version of it they can afford. Cost will always matter, of course, but operators of hotels and resorts in the Maldives can start to reposition price as just one factor of the overall decision.

With personalised pricing, each guest would be given more options in the online booking environment. They can select the individual components of a room they want and leave off the ones they don’t, either spending extra or getting a cheaper rate in the process.

By implementing personalised pricing, resorts can separate and categorise all their products and services into components of value. Features that are currently invisible during booking could now be brought to the surface as part of the decision-making process. This will help drive differentiation, meaning there will be less emphasis on direct price comparison with competitor products being marketed as the same thing, despite their many differences.

Hotels and resorts should not forget that there is also power in choice, both for the buyer and the seller. With personalised pricing, potential guests will be able to tell a hotel how much they’re willing to pay, and hoteliers can, in-turn, monetise more of their assets.

Murphy Mathew is the APAC Solutions Engineer, IDeaS

For more information on how your hotel can attract more demand and improve revenues through a personalised approach to pricing, please visit: www.ideas.com

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