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How to use Automation and Revenue to Boost the Profitability of Your Accommodation

Automating communication, distribution and providing services becomes a pending issue to scale the customisation of the different types of tourist accommodation. You need to identify how Revenue Management and Marketing Automation can help boost your profitability.

The challenge is to balance the product, technology and distribution. To achieve this, revenue planning must be strengthened and actions that can overcome the difficulties and shortcomings between both must be automated.

A revolution has arisen in the personalisation of marketing and the use of large volumes of data. The standardisation of systems that can compete with those available to large corporations, well focused on certain markets, and together with a competitive product means you can effectively compete. You can find out more about how to optimise your revenue at Native Management.

Focus areas

Prioritise GOPPAR on occupation

In an era with more competitive pricing, it is important to prioritise factors such as GOPPAR (gross operating profit per available room) and optimise data such as ADR (average daily rate), leaving the occupation in the background (but without downplaying it). As an example, lower occupancy but with higher rates can generate more income than having full occupancy with lower rates.

Optimisation of distribution systems

This is a challenge for accommodation, so it is critical to pay attention to this aspect. Can you answer these questions? The answers will help allow you to address the main concerns that arise with regard to the optimisation of channel management:

  • What mix of distribution systems generates maximum profitability?
  • Which one represents the best cost-benefit ratio?
  • Which system offers optimal profitability in the long term?
  • How can systems be configured to eliminate errors in the calculation of inventory and reserves?

Select the right channel mix to avoid continuous changes in decisions regarding distribution and which, in general, lead to a clear waste of time and effort. This seeks to forge long-term relationships with travellers and with the channels with which they are familiar.

Take advantage of dynamic pricing

The setting of dynamic prices on real data and the use of tools for this purpose should be one of the aspects on which any hotel should focus. The demand forecasts must be optimised, especially for reservations, cancellations, arrivals, conversions, group reservations, seasonality or the loyalty of travellers.

The RMS (Revenue Management System) becomes a key tool for comparing prices, controlling inventory, and providing hotels with the essential market data needed to help in the decision-making of distribution and price. If you acquire skills in the use of price as a “competitive advantage”, it will be useful in acquiring customers who are price-sensitive. Therefore, determining these factors and attacking them will be key in the technological and human mix.

Focus on the sale of other resources that are not rooms

Who said that the room occupancy is the only focus of income generation of accommodation? Bars, swimming pools, games rooms and spas are also an important source of income generation. The accommodation that offers premium services can work strategically under forecasts of segmentation, demand and distribution of travellers.

Big data as leverage to analyse guest habits

This consists of using the data collected from different platforms to analyse the evolution of the traveller through the development of patterns. This data refers to information such as guest preferences, changes in the evolution of the market price, occupation, etc. The goal is to save time and effort on critical factors such as direct booking.

The vast majority of the accommodation providers lack sufficient resources to invest in personnel dedicated to handling critical tasks within Revenue Management. This, in turn, translates into a lack of generation of necessary reviews to strengthen the decision making of the traveller. From here arise some questions such as: What tasks can we automate to improve efficiency in revenue management?

Independent accommodation providers enjoy more freedom and dynamism than big hotel chains. Therefore, you must be aware and take advantage of this freedom and dynamism that, added to the new tools of automation and marketing, and hand in hand with Revenue Management, will be an affordable and efficient manner to boost operational profitability.