Revenue management COVID strategy: Total Revenue Management

Before the crisis, revenue management was largely focused on maximum room revenue. Today, hoteliers are looking for ways to generate extra revenue even during low-occupancy times. In line with this, we’ll see an important shift towards total revenue management.

We spoke to revenue managers Thibault Catala of Catala Consulting, Adrienne Hanna of Right Revenue, Annemarie Gubanski of Taktikon and Thomas Greenall of Bespoke Hotels to find out how using total revenue management could benefit one's property.

Understanding your hotel as a whole will help you identify new ways of wowing guests and increasing your total revenue. Here are some steps to follow to get started.

Examine your customer journey and their buying habits. Take the time to learn where your customers come from, which sales and marketing approaches work best, and which services or products are most popular. Then look for ways to maximise profitable channels through enhanced collaboration or targeted marketing. End by deciding which of the less profitable approaches you want to eliminate.

Use technology where you can. Modern hotel tech and AI-powered solutions can help you save time, get better data insights and make well-informed decisions faster than ever before. Leverage these tools so you can spend less energy on repetitive tasks and focus on refining your strategy instead. Think of it as transforming revenue management from an art into a science.

Evaluate data from other departments. When you let a tech solution do the data collection and collation work for you, you can analyse more information from your different departments to get insights on their successes and challenges. Use this knowledge to further refine your approach and unlock new revenue-generating ideas.

Increasing revenue in departments apart from rooms is a big part of total revenue management. Especially since cashflow is a challenge for many hotels right now, generating more revenue across the board can make a deciding difference.

Implement a cross-selling and upselling initiative. Use this low-demand period to train staff in upselling guests to higher category rooms and to promote other departments. For example, offer a discount on spa or F&B services if guests book on the day they arrive.

Streamline upselling and cross-selling with a tech solution. Using an automated upselling platform will save you hours, take pressure off your staff and even allow you to promote offers to guests pre-arrival. This drastically increases your conversion rates and ancillary revenue.

Create unique offers and deals. Make your upselling and cross-selling initiative more successful by offering your guests fun and exciting deals on top of the usual room upgrades. Let your creativity run wild here and test different options to see what your guests enjoy. Doing this lets guests personalise their stay in a way they couldn’t before and ensures they’ll have an unforgettable time.

Focus on leisure offers since the leisure segment will be the first to recover and these guests are generally more open to upgrading their stay.

Below are a few ideas on how to generate ancillary revenue at your property. If they don’t all work for you, use this list as inspiration – come up with something new and unique to try at your hotel, the possibilities are endless!

Food and beverage:

• Extend restaurant opening hours to balance out restaurant occupancy restrictions
• Reduce menu options and work with seasonal specials to save on food cost and offer variety
• Join local food delivery services
• Offer deluxe dining packages in suites, by the pool or on the beach
• Pre-sell F&B credit at a 10 or 15% discount to encourage in-house spend

Spa:

• Create special spa packages or offers for couples
• Promote your most profitable spa treatments via pre-arrival messaging
• Pre-sell spa credit with a 10 or 15% discount
• Set up combination packages including both F&B and spa services

Recreation:

• Monetise your parking spaces with pre-arrival messaging or by opening them up to locals
• Partner with local tour operators, guides and destinations (e.g. theme parks) to offer guests fun activities they can do outside of the hotel
• Come up with family-friendly offers like movie night packages, pastry or cooking classes kids and parents can enjoy together

Place your USP at the fore of your brainstorming process to delight your guests and generate additional revenue. Every little bit counts and every additional perk to a stay will bring it closer to becoming an unforgettable experience for your clientele. Stay focused on your guest and you can’t go wrong!