Why Hoteliers Should Relook Their Distribution Strategy?
By Mike Kistner
Friday, 28th March 2014
Exclusive Feature: With online distribution becoming an important source of room bookings, hoteliers are increasingly adopting this model, however they are also confronted with the complexities in the distribution environment.

Manual update of inventory on the electronic distribution channels, manual update of the bookings into the property management system not just when the booking is received but for each and every modification or cancellation.

Typically the industry average is around 1 modification for every 3 bookings, and at that rate you can think of the number of the tasks that need to be performed at your property management system so as to not miss out on any of the guest requirements.

And just when you think you've done it all, there comes another modification to the original booking! Things just get messier.

And oh did I forget the cancellation that just came in! So you are perennially updating the system, facing embarrassing moments with guests when their changes are not recorded in the system, and not selling a room that should have been because it was cancelled. Well that's the complexity.

So how do we simplify this?

In a real-time distribution model your hotel is connected real-time- two way to the electronic distribution channel.

What happens then? Your inventory and rates automatically flow to the channel, you of course can decide how many rooms you want available for sale on each of the channel. No more manual update of inventory on the channel's extranet! How about the bookings coming in from the channels?

They just flow into your property management system, simple. And so does each and every modification and cancellation. The RezNext distribution model is real-time and is currently helping hundreds of hotels distribute their inventory and rates real-time.

A successful distribution model needs to be powered with revenue management intelligence.

Distributing your inventory real-time cuts the complexity which is great, but how do you now power your distribution to result in improved revenues. How do you arrive at the rates at which to sell? Is there a science backing your strategy?

Determining what room type you want sold on what channel and at what rate, is not simple. An advanced revenue management solution that is tightly integrated with your property management solution can access historical data and churn out accurate forecasts which then hoteliers can use to establish the selling strategy with all distribution channels. You are now in a position to understand the best rate at which your hotel can sell given your forecast and previous history of bookings.

An integrated revenue management solution also incorporates competitor rate information fed in from a rate shopper solution and can then deliver both demand based and competitor based best available rate so you are ready at all situations to maximize REVPAR.

Adopt a real-time distribution model that is powered by revenue management intelligence to simplify your distribution process and to maximize revenues.

The article is authored by Mike Kistner, Chief Executive Officer, RezNext Global Solutions, Pvt Ltd. RezNext is a leader in providing real-time hotel distribution technology. You can write to the author at info@reznext.com.
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