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Better Together: Group Pricing Advances for Asian Hoteliers.
By Rachel Grier - Exclusive for 4Hoteliers.com
Sunday, 27th March 2016
 

Exclusive Feature: Faced with increasing competition and evolving booking-environment complexities, hoteliers across the Asia Pacific region need a better understanding of their guests more than ever before and employing best practice strategies and systems to target potential guests with tailored offers has become mission critical in securing their business.

Alarmingly though, despite almost every hotel managing multiple revenue streams, team members within each of those streams still tend to concentrate solely on their own department. This typically results in making pricing decisions that are based on the impacts to their area of business only.

This type of siloed approach harms a hotel in the long term, because it takes an entire teamâ€"not just one departmentâ€"to capture the right guest at the right time, for the right rate.

A hotel’s sales team is tasked with connecting directly with consumers to generate demand and secure market share, whereas the revenue management team controls demand through profitable pricing strategies. This can often lead to a disconnect in the messages coming from a hotel, either indirectly or directly. By working closely together and sharing knowledge, strategies, data and systems, revenue management and sales teams can better complement each other to maximise revenue across the whole property.

Revenue management technology has evolved over the years to provide hotels with better data, clearer insights, optimal pricing and increased productivity. Automated reports and distribution have replaced manual entries, eliminating cumbersome manual rate uploads and reducing human error.

Performance support has improved on-the-job system learning capabilities; and the right data, optimal prices and powerful detailed forecasting tools have significantly amplified revenue performance possibilities to the total organisation.

While advances in revenue management technology enables the hotel’s systems to seamlessly distribute the right price to the market at the right time, it also directly supports the work of a hotel’s sales team; where group pricing technology is rapidly emerging as one of the most powerful revenue-generating tools available to hotels.

The group pricing capabilities of advanced revenue management systems go well beyond the limited functionalities of other revenue systems and use measurement metrics that encompass all elements of an event; including profit contribution, complimentary rooms, commissions, food and beverage, ancillary spend and more.

Group displacement evaluations allow sales managers to weigh potential group business across multiple dates and understand the financial impacts of accepting a group over periods of high or low transient demand. This allows the sales manager to identify whether accepting a potential group will make the hotel profit (not just revenue), or if it will end up costing the hotel money.

Business intelligence reports and data visualisations generated by a revenue management system’s group pricing module provides sales managers with confident recommendations of the best rates by arrival date, as well as optimal and alternate date ranges for flexible or price sensitive groups.

Additionally, the group pricing module presents granular insights on displacement revenue and additional revenue streams, profit margins, profit per room night, and the ability to review this data in real-time (and thus revert to client quickly.) These elements are essential to the sales and negotiation process and are particularly important for the Meetings Incentives Conferences and Events (MICE) groups responsible for presenting key opportunities for profit maximisation.

Revenue management group pricing modules also deliver valuable interdepartmental benefits. Powerful evaluation tools have begun to change the conversation at revenue meetings. Commercial discussions regarding opportunities are taking place instead of spending too much time on manual group assessments.

Detailed profit reports and evaluations also empower the sales team to quickly qualify business on the spot with both their leadership team and their clients. Sales managers can independently run group evaluations directly in the revenue management system, reducing the time revenue managers previously spent assisting with group rates.

Recommendations and analysis are generated based on the parameters configured by the revenue management system and logged for tracking and rate authorisation purposes. Revenue managers and sales leaders can access all relevant group business information directly from the systemâ€"a significant time saver compared to the manual process of consolidating and reporting group lead and quote information.

Hotels that employ revenue management technology and approaches with group sales members not only benefit from improved revenue outcomes, but also increased productivity amongst key members of staff. Time previously spent in meetings, waiting for a rate or consolidating reports can now be used to prospect new clients or closing MICE deals.

There are additional benefits that the right revenue management system can provide to the sales and operational teams. Visualisation tools empower the revenue manager to easily communicate the short and long term forecasts by segment and room class across the property â€" providing the vital business demand insight required to schedule staff, food and beverage requirements, housekeeping and engineering projects. Sales teams gain a deeper understanding of which segments are not performing well in advanceâ€"and with the support of marketing, can develop strategic and tactical campaigns to change their business outcomes.

Today’s sophisticated hotel operators know that whole property revenue maximization cannot occur in a vacuum; all departments must be aligned in practicing revenue management disciplines.

For hoteliers in the Asia Pacific region, user-friendly advanced revenue management technology is available to transform large, disparate data sets into actionable intelligence for making accurate demand forecasts and strategic group pricing decisions.

By Rachel Grier, Asia-Pacific managing director, IDeaS Revenue Solutions

This is strictly an exclusive feature, reprints of this article in any shape or form without prior written approval from 4Hoteliers.com is not permitted.

Rachel Grier is Managing Director Asia Pacific for IDeaS â€" A SAS Company

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