Exploring the Software Cosmos as an Adaptive Hotel Revenue Manager

NEWPORT BEACH, Calif. - Jan. 10, 2018 - PRLog -- A common hurdle in today's hotel revenue management world is adapting to new systems. This includes Marriott's newest rollout of its revenue management platform, One Yield Version 2**. Over the course of two days, Marriott provided blended virtual trainings for its franchisees, challenging them to deal with real-life scenarios, perform brute analysis and make revenue impacting decisions.

The roster was unusually eclectic, comprised of leaders in revenue management, general management, sales, events, finance, and operations. This all-inclusive dynamic shed light on the importance of a collaborative buy-in. While it may be the revenue manager's responsibility to monitor the system, all property staff can (and ought to) influence the inputs and take ownership of the outputs.

New systems make that process more approachable. Despite the labor lifting that new systems provide, the industry is still chock-full of revenue managers shirking adaptation. Below are the reasons that should convince them otherwise.

Marrying the power of humans and machines

Increasingly robust softwares take the inefficiencies out of setting rates and managing inventory. Their sharp algorithms and beefed-up databases enable revenue managers, the rate vigilantes already keen to price optimization tactics and the tides of their local markets, use better data to make swifter decisions. In turn, revenue managers get to tackle their property's remaining hierarchy of needs: the ones still requiring the human touch.

The inherent risks of a software launch are what initially make the decision-making prowess of a human so critical. The system may spin out of control, or publish unrealistic rates and inventory. If its predictive analytics are based on machine learning, it can also take 4-8 weeks to "warm up" to property data.

Revenue managers have been elaborately trained to look into the crystal ball and decipher demand patterns for future dates. They've already been doing so, just with inferior systems which have made readings murky. With each software update they can provide more holistic, more expert service levels.

A knowledge base for portfolio to share

Embracing a new system helps carve out new analytic strategies translatable across brands, platforms, and even disciplines. The fundamentals of revenue management are built into each system across the board, with ever-so-slightly different executions. All include a warehouse of trends, demands, year-over-year (YoY), current pricing and dynamic comp shops in the market. Theses fast-twitch executions, unique to each software, spit out a feasible and data-driven strategy.

A sly multi-property, multi-brand revenue manager will not only apply these strategies with agile precision and expert localization, but will also share the love. Revenue managers have spent far too much time in the discovery phase, having undergone a lifetime's worth of various brand trainings, to diddle-daddle in theoretical "what-if"s. They get revved from application – from testing, building, responding and ultimately scaling up. At the minor expense of being perpetual guinea pigs, the entire portfolio benefits from this procedural growth.

The spaceship might need repair, and that's O.K.

Change is an opportunity to become more resilient. Before Marriott's previous system was rendered obsolete, it was easy to fall victim to the day-to-day humdrum. Monday quarterbacking was the game plan for revenue meetings: analyzing reports which focused on pace, what was consumed, and what actualized, with a heavy focus on year-over-year (YoY) data. Turns out that basing this year's strategy on an unconfirmed success is an unreliable process. Properties stuck in rut may not be realizing the full potential of their hotel.

Your hotel revenue meetings may seem focused, but perhaps on the wrong things.

OneYield's update is shifting focus from pace to demand. This paints a clearer picture of current demand being realized in the market and has changed the way revenue meetings flow. An example scenario: It's Wednesday and the property has 75% occupancy on the books for Friday. Prior to the new system and a fresh outlook, properties would dwell on the question, "How do we achieve a sell out for Friday?". Questions are now motivated by deeper insights, such as "Will we get a sell out with the remaining demand? And if so, what is the optimal business mix based off of length of stay patterns and rate captured?"

Quit orbiting

In spite of the growing pains that come along with learning a new system, seeing increases in RevPAR make the parallel increases in training hours, software glitches and cortisol levels worthwhile. The collaborative efforts between sales, operations and hotel revenue management teams have always been critical to Twenty Four Seven's portfolio-wide success.

About Twenty Four Seven Hotels:

Twenty Four Seven Hotels specializes in providing hotel management, investment and development for premium brand select-service and lifestyle hotels segments in the Western U.S. We offer a full spectrum of services in Hospitality Management, Hotel Investment, Hotel Design & Construction and Hotel Asset Management.

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