Last-minute, on-the-go booking presents an impossible challenge -

Over the years, customers have been presented with many options, or 'channels,' to book their hotel rooms; the most recent channel to emerge – the mobile channel - has given hoteliers a new reason to revamp their pricing strategies:  a booking window of minutes, rather than hours, days or weeks. 

A recent Priceline.com sampling of its "Priceline Hotel & Rental Car Negotiator" app for iPad and iPhone, showed that 82% of users booked within one day of arrival.  This is a significant slimming of the booking window, one that requires unprecedented efficiency and skill by hoteliers and revenue managers.

What is Required to Succeed?

Most OTA booking engines are proficient at catering to the last-minute shopper by continuously updating listings based on multiple attributes.  Accordingly, in order to get optimal page position, hoteliers must continuously manage their rates in relation to these attributes.  Most mobile booking engines are set at default to "book today, for one night," proving the fact that today's mobile customer is looking for last minute deals.  Furthermore, "name your own price" sites can price and book in a matter of seconds, taking the worry out of leaving a hotel booking to the last-minute.

In order to stay on top of their OTA positions and rates, hoteliers have to constantly, manually manipulate their rates based on current availability, competitive rates, time of day/week/month, etc.  This had been true for many years with the traditional hotel marketing channels, and in the last decade, the emergence of the internet and OTAs added yet another channel to manage.  Revenue managers had to adapt.  Now, mobile booking has added one more channel to manage and once again, revenue managers must adapt in order to survive.

Most hotel revenue managers fail to manually change rates as many times per day as really needed to compete with their local competition, just because of the sheer magnitude of that task. And local competition represents only one attribute of each channel that revenue managers need to manage. 

Here's a short list of other attributes that need to be "reacted to" and managed in order to stay ahead in mobile booking:

• Price - Competitors
• Price - Market
• Price of Hotels by Star Ratings
• Price of Hotels by Guest Ratings/Reviews
• Local Availability (and Unavailability)
• Booking Patterns based on day of the week
• Projected Performance
• Market Share by Destination
• Market Penetration by Star Ratings
• Historical Pricing Data

While certainly not exhaustive, this list hints to the endless complexity involved in managing the online and mobile booking channels.  The more attributes you actively manage, the better the chance a hotel has for success.  The amount of attributes is endless, and the complexity of how to analyze attributes is limitless.  Human beings are restricted by the amount of time required to perform the algorithmic quantitative analyses needed in order to respond to the "instant" nature of mobile booking.

Of course, even if revenue managers could find a human expert to successfully manage all of this data and keep it continuously updated on all channels (not just mobile booking), it would be cost prohibitive for most hotels.

So what is the solution that hoteliers need to adapt in order to be successful in today's mobile booking environment?

Revenue Management Software Provides a Solution

Just as proprietary online stock brokerage applications (E*Trade, TD Ameritrade, etc.) track real-time stock prices, volume and movement¾automated revenue management software tracks all hotel booking channels and all channel attributes.  This occurs real-time, automatically, 24/7. As well, revenue management system software evaluates attributes and alters inventory to assure the best possible OTA page position for both standard web and mobile web/app booking.

Prior to the popularity of mobile booking, such real-time evaluation and adjustment by humans was impractical.  With the onslaught of mobile booking apps and the slimmest booking window imaginable, this evaluation and adjustment is now impossible.  Humans alone simply cannot fulfill the necessary obligations needed to ensure competitive prices and maximum booking.  With revenue management systems, the human time saved represents real financial savings, thus, maximum overall profit. 

Of course, that being said, no RMS will ever remove the necessity for a human revenue manager.  Although the RMS can take over the mind-numbing collection and analysis of data and the updating of rates and inventory across all channels, a RMS will never be capable of the strategic thought, proactive reasoning and planning that a good revenue manager offers.

Quite simply, these systems allow hoteliers and revenue managers to simply oversee the process, freeing their time to deal with matters not suitable for software¾call it "being human" again.

About REVPAR GURU

REVPAR GURU provides hotels around the world with an alternative revenue management software solution, designed to deliver maximum bookings and profits. As REVPAR GURU's custom-designed Yield Dynamic Price Engine is the only real-time revenue management software available on the market, it meets the rapidly changing needs of hotels in a very demanding business environment.  REVPAR GURU's  solution 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, REVPAR GURU's software solution has been used by hotels worldwide to increase occupancy and RevPAR. 

www.revparguru.com