7 Ways Your Hotels Are Missing out on Revenue Opportunities

Revenue Management benefits

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In 2023, the global hospitality market reached 4.7 trillion USD. It was forecasted to grow to 5.8 trillion USD in 2027 at a compound annual growth rate (CAGR) of 5.5%. With such great demand comes great challenges in terms of revenue opportunities.

In order to remain profitable in the long term, you’ll need to sell more rooms and draw in more visitors as a hotel owner. As a result, your sales strategy should reflect your dedication to giving the customers the best experience. But whether it’s off-season or peak season, there should also be a focus on booking as many rooms as you can at any time.

When thinking about potential new revenue streams, having excellent knowledge of your market, your prospects, and the brand identity you wish to establish is crucial. Take a step back and evaluate your entire business as the first step in making sure that your hotel is profitable. Revenue Management benefits your hotel the most. Check to be sure you’re not doing any of the things below. Also, are you familiar with the revenue management process? Keep reading.

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Missing Out on Hotel Revenue Opportunities? 7 Reasons Why

What is the revenue management meaning? How to increase hotel revenue? We have discussed this in the previous articles. You will agree that taking advantage of revenue opportunities is more crucial than ever right now. Especially with prices rising across the board for hotel operations and demand only starting to increase. In any other case, your hotel’s profitability might suffer, and its long-term success might be at risk. But, there are lots of things you can do to boost hotel revenue.

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1. Not Using a Hotel Revenue Management Systems (RMSs)

Hotel owners have better visibility into their revenue opportunities when using hotel revenue management software. As a result, hotels can track and forecast their demand and set prices as required. Revenue management function increases the number of bookings and profits. A dedicated hotel RMS enables decision-makers to watch and manage guest experience as well. In fact, other benefits are:

a. Increased revenue
b. Lower costs
c. Improved guest satisfaction
d. Finding other revenue opportunities

2. Not Tracking Sales & Leads

Sadly, hotel managers don’t respond to the majority of sales inquiries. As per a survey, event sales managers lose, disregard, or discard 28% of group sales inquiries.

If that’s the case, your prospects may be moving on to your top rival. Utilize new tech such as revenue management software for hotels, powered by Machine Learning (ML) and Business Intelligence (BI). It assists in streamlining leads and sales and ensures that customer inquiries are responded to right away.

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3. Setting Prices Manually

Despite the fact that manual rate setting used to be your only choice, you should reconsider doing so now. Yes, you have complete control over your revenue management pricing. But, it also takes up a lot of money and time. The time required for market research and manual system upgrades gets out of hand if you wish to price dynamically and have a variety of room types.

Maybe you only change the prices once a week, once a month, or once a season if you can’t find time for this activity regularly. Even while it saves time, it is hard to guarantee that prices always represent the most recent state of the market. You run the danger of losing bookings during the low season and charging the customers extra during the high season.

4. Not Considering Market Demand Data

What data do you consider while setting your rates for revenue opportunities? Perhaps your legal business? Maybe the costs of your competitors? If it’s the two, you’re on the correct track because they’re vital to creating an extensive revenue management strategy. Don’t stop there though.

Have you thought about putting in source market behavior, search pressure, and hotel search volume as well? While getting these data parts can be hard, they are crucial for driving pricing choices since they give you a more complete picture of the market and changing demand.

The volume and complexity of this type of data make it impossible to collect and use in real-time. The data should be gathered and presented using a business intelligence (BI) tool so that it is clear and simple to follow. Your RMS should provide automatic updates and recommend prices based on these futuristic data points. This opens the door to an even more refined pricing strategy.

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5. Looking at Competitors or Not Enough

Compset analysis is crucial to both pricing and market analysis. Finding the ideal mix between studying your market and rival data is vital. It’s never a smart idea to follow your rival’s pricing trends blindly, whether they’re going up or down. They may have unique conditions that may not be applicable to you. Such as the fact that they recently won or lost a sizable group.

But also take note of any changes in their rate. This may cause you to over-charge yourself or fill up cheaply when you don’t need to. So, monitor your compset and make an effort to know their changes, but set your own pricing.

6. Guests are Not Aware of the Offers & Services

It’s hard to keep track of and manage all the options that can produce extra revenue for a hotel. Ancillaries and room upgrades are two of these resources. If guests are unaware of the appealing room changes and ancillaries you provide, your hotel’s profits may fall. More than 40% of your potential guests reserve rooms online.

Unfortunately, there aren’t enough resources available online for them to see what else you have to give. It won’t be that hard to get beyond this hurdle. With the right tools or services, you may add new revenue streams for your hotel through ancillary sales and room upgrades.

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7. Failure to Conduct Regular Meetings

As per research, 72% of managers regularly meet with their teams to evaluate sales. Create a culture that inspires your teams to maximize each lead and revenue opportunity to make sure you receive more from the team you have.

They may be more willing to share with you what worked well and what required adjustment during a weekly or bimonthly meeting. This will assist the group in gaining some insight, receiving the support they need, and avoiding making the same mistakes again in the future.

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5 Solutions to Missed Hotel Revenue Opportunities

Did you know? In the same way that it’s critical for hotel owners to explore methods to improve the guest experience, they also need to keep looking for ways to increase revenue. It will be easy for your hotel to remain profitable during hard economic times and to secure long-term success if you adjust your revenue management strategies to the ever-evolving hotel industry landscape.

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You won’t ever miss revenue opportunities to improve your bottom line by leveraging consumer demand and creating effective, automated internal processes. Do you want to know how in detail? Wondering about revenue management in the hospitality industry? Are your hotels in dire need of creative solutions? Here are 5 ways.

Revenue management system

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1. Boost Direct Online Bookings

The best call to action you can offer to visitors is an online booking engine for your hotel’s website. This is the ideal strategy to promote 24/7 direct, commission-free bookings for more profit. Because 83% of US adults prefer to book their trip online, make sure they can do so directly with you rather than through an OTA to increase your bottom line.

What more are you willing to do to boost direct online bookings? For visitors to follow through once they decide to book, your website booking engine should be simple to use and easy to find. It should be paired with your Revenue management system (RMS) to remove the need to handle manual bookings. It not only saves time but money as well.

2. Optimize OTA Platforms

Optimizing your distribution and revenue strategies requires integrating your RMS with external booking channels. Booking channel links let you react fast to market changes by importing OTA/GDS bookings into the RMS and changing pricing and availability on your OTA/GDS channels.

Do you want to revise prices across all channels in sync with the shifting market? Do you want to optimize your OTA channels? This will help you maximize revenue while avoiding the risk of losing money due to manual errors and multiple bookings. Want some revenue management examples? Read our other articles.

3. Dynamic Pricing for hotels

Searching for the top revenue management companies for hotels? What is dynamic pricing in revenue management techniques? Successful revenue management is crucial for your hotel and requires dynamic pricing. It ensures that your prices reflect current demand and maintain competition. You can avoid setting your prices too high and losing bookings in the off-season. Dynamic pricing is mostly followed by hotels during periods of great demand to avoid underpricing as well.

Rates are updated in real-time to reflect changing consumer demand and availability when this process is automated using an RMS. The issue with trying to manually update rates is that you have to invest vital time in market analysis to decide when and how much to adjust prices. By automating this process, time and resources are saved that may be used to enhance the guest experience.

4. Upsell through your Booking Engine

What is the goal of revenue management? Make it simple for visitors to spend before they enter your hotel! Customers are most receptive to extending their stay with tailored packages and add-ons during the guest journey’s planning and booking phases. By offering package pricing and promoting suitable in-room extras and add-on services, a revenue-driving booking engine will enable you to capture ancillary purchases. For example, canoe rentals for families, etc.

Do you want to make your visitors feel special? Do you want to upsell through your booking engine? So, deliver tailored upsell offers based on booking data through pre-arrival interactions (by email and/or texts). Only if the emphasis is on customizing the guest experience can upselling be a terrific strategy to increase total revenue.

[Suggested Read: How Machine Learning Affects Revenue Management and Pricing]

Hotels Benefit from the Revenue Management

5. Value-added Packages & Gift Certificates

By providing an exclusive visitor experience packed with amenities and value, packages are a great way to increase revenue. It helps during busy and slow times. Value-added packages, which combine hotel rooms with additional goods and services (guided tours, spas, meals, gift shop vouchers), increase revenue all year long by luring both new and returning visitors.

Gifting unique experiences rather than tangible items is becoming more and more common for revenue opportunities. As a result, hotel gift cards are a potential source of revenue for hotels. Who doesn’t like gift vouchers?

But how can you increase hotel profits? Do you want to boost hotel revenue as well? Boosting unused sources of income will come from finding creative methods to deal with ever-changing consumer demand. Use tech to streamline operations and services to attract visitors all year long. Looking for a hotel revenue manager for hire? Read till the end.

[Suggested Read: How Hotels Benefit from the Revenue Management Concept & CRO]

Revenue Opportunities Are Crucial for Hotels

Hotel owners and their teams must stay on top of every deal, every number, and every stat generated under their control. The hospitality sector has become more competitive with visitors’ ever-shifting tastes and unique demands. No surprise that hotel RMS is taking over as a must-have tool for hotels and firms in every sector.

Looking for revenue opportunities and automation? Searching for a data-driven approach or the top hotel management company in India? Finding the best revenue management solutions for hotels? Or just scouting for the best revenue management services? Call us at +91 9167900620 (India) or +254 702794646 (Africa) or +84 91 4325511 (Vietnam) or email us at connect@revnomix.com to amplify your revenue streams and exceed your hotel goals.