In the event of lower demand for hotel rooms or apartments than expected, what should hoteliers do? During the times when hotel room occupancy declines, most revenue managers begin to believe that Revenue Management Systems (RMS) are useless.
Covid period is an example when the occupancy rate started plummeting to zero during. That there would prevail an air of panic among hoteliers was quite natural as they thought it was really challenging to navigate those times. Many of the hoteliers had to freeze the prices of their hotel room rents and even decided to keep the use of RMS in limbo, considering this as an extra burden and useless when demand was, indeed, low. As a result of low demand for hotel rooms, RMS had to face an untoward testing time.
In spite of this, it turns out that even during the period of low demand and volatile times, an RMS can earn considerable amounts of extra money for a hospitality business.
Let’s know how an RMS can help make it possible.
Assist You in Making Better Decisions Through Price Recommendations
To create price recommendations, there are two main steps. Forecasting accurately is the first step. Using cutting-edge algorithms, RMS generates forecasts in real-time based on both historical and recent booking trends. In order to create the optimal rates for the given demand on each date, RMS’ price optimization engine applies operational research techniques. With RMS’ simulation engine, calculations are made to a high standard. Using advanced statistical methods, it examines a multitude of possible scenarios and concludes with the most probable scenario.
Give You Dynamic Pricing in Real-time
Furthermore, a new generation RMS offers real-time dynamic pricing. It means that it will automatically detect and immediately adjust for the times of the low and high demand. It will lower the prices when you need to be a bit more conservative to invite guests. It will increase the prices immediately when it discovers a spike in demand. You’ll unlikely miss any events and that the price will always be optimal.
Aid You in Understanding Seasonality and Planning in Advance
Using a robust RMS, you can determine your region’s seasonality trends. Moreover, you will gain insight into the period when your hotel has low occupancy.
Making your hotel profitable depends heavily on how you plan your pricing strategy for different seasons. You can determine the best pricing or promotional strategy for your hotel or apartment by investing in the right revenue management software. Using RMS, hoteliers like you can plan ahead and be prepared for whatever comes their (your) way by leveraging its power.
In Conclusion:
Successful hospitality businesses utilize their RMS to the fullest extent because it helps them fight the periods of downturn and thrive in times of travel booms. It helps them gain an advantage over their competitors by always making their prices attractive.
A modern RMS – like Pricepoint – is easy to use and automatically integrates with your PMS or channel manager. It cuts hours of work and allows managers to focus on the final results.
Discover more about the key features of our revenue management software – PricePoint – by clicking here.