How to ensure that you are 'Revenue Ready'
How to ensure that you are 'Revenue Ready'
This week we got some amazing news that we may just have light at the end of the tunnel... A vaccine is on its way, and although it may take months to deliver, we have hope and an absolute belief that we can now call this pandemic 'finite'. There is an end in sight... As an industry, we have been beyond resilient and now is the time to focus on the positive news and to start planning to ensure that we are 'Revenue Ready'.
To help and support this amazing industry we launched our first series of 'Revenue Ready' webinars this week, bringing together some of our industry's top experts to educate and mentor. We would love if you could join us on this amazing and educational journey and you can find out more about Series 1 at https://rightrevenue.co.uk/webinars
But to start, what is 'Revenue Ready'
Right Revenue was founded after 18 years of direct Revenue Management experience and the fundamental core of our system is to support hotels through what can often be seen as a complicated, high-touch, ‘big-data’ reliant and let’s face it, quite a labour-intensive, and maybe even slightly ‘nerdy' discipline.
Well, the truth of the matter is that Revenue Management shouldn’t be any of those things, and we firmly believe that Revenue Managers should be both commercial and strategic and that your Revenue Management solution should be there to help support your key team members, to make much better decisions on not only rate, but also your total commercial landscape.
Clever hoteliers understand that investing in technology will support both their teams and their strategies out of this mess that is Covid-19. But this terrible pandemic is finite, not infinite and great strategies based on sound decision making will help you maneuver through not only short-term decisions but also help us prepare for life after a pandemic.
But how do you do that and where do you start?
My first piece of advice is to start with a piece of paper (yes seriously) and map out every solution that you have. From your PMS, to CMS, CRS, POS, website, booking engine, loyalty software and of course RMS – look at every piece of your technology stack. Understand what they do for your business, where they interface, how they interface and importantly, what cost centres each are attributed to. Get a really good understanding of where you are, where you need to be, and you will start to build up a picture of what gaps you have in not only technology, but where you can take some of the ‘heavy lifting’ away from your key team members to make them more strategic in their roles.
Then have a good long look at how your PMS – which is often your single point of truth – is working for you. Forget about the myth of big-data and start to have a look at what is useful data. How is your system set-up to give you relevant and useful information on your sources, segments, channels, rate profiles and customer profiles? So many times I find that this amazing resource is under-utilised. Anyone making commercial decisions within your organisation needs great data, and that means clean data. So take a long hard look at how your system is set-up; are you making the best possible use of your data and it most importantly, do your team understand just how important it is to input good data and the important role they as individuals are at in ensuring that critical information can be gleaned from your PMS into your revenue management solution.
As an example, keep your market segmentation streamlined and relevant to you. Have main market segments (8 max) and minor segments if required. Most of you rely on multiple sources so ensure that you have an easy way of tracking. As an example, the main source could be OTA and then broken down further to Booking / Expedia etc. Have your system set-up so that your team can report on multiple layers of business and then broken down if required. As another example, have a way of grouping together all your commissionable channels or your top 10 corporates. Allow your revenue management solution to show you where you are successful and where there are gaps, but to do that you need great, clean data to work from.
Once you have your systems streamlined, the next really useful task I recommend is to understand and SHARE your cost of occupied room. I have rarely found a company that is realistic about their cost of sale and even rarer are those hoteliers who share that among their team.
Be realistic about your fixed and variable costs; take Covid into consideration and for goodness sake share your findings. Your team need to understand your ‘walk it’ rate i.e. the rate you cannot go below or you lose money. Your marketing and salespeople need to understand the rates that you need to cover when they are building rates and packages, so do the maths and share.
The most strategic hoteliers I have seen in the past 24 years are the ones who are not protective of their financial information. Share your targets. Let everyone in your organisation and I mean EVERYONE know what you are working towards. Your whole team needs to buy into your strategy; have shared goals and be bought into what you are trying to achieve.
Great revenue involves every single part of your organisation - and it is reliant on perhaps the most used term when speaking about great revenue management, and that is that you have to, have to, have to, break down silos.
Covid-19 has catapulted change! We need to come out of this finite situation understanding our distribution strategy and not just short term but long term. We need to understand our customers new buying patterns, costs; new ways of bench-marking; new needs on digital, requirements for our website, booking engines, guest communication, new ways in which we need to service our clients; sales; marketing, our ability to price and the impact of new demand.
If we look at one benefit arising from Covid-19, is that it has given us time, time to re-look at all our systems and procedures and to understand the value in doing that. We have this unique time to get 'Revenue Ready' and whether you chose to use a revenue management software solution or not, now is the time to get your own house in order so that you start 2021 stronger and smarter.
So what is Revenue Ready?
If you are lucky enough to have owners who see the huge benefits of investing in technology then please, for goodness sake, give this amazing technology the very best opportunity to work cleverly. As I said, software that basis itself on great data needs the very best opportunity to work for you. But more than that, you need absolute and complete buy-in from your team. Get the right people involved in your technology decisions. Ensure that they know your common company goals, allow them time to be mentored and trained and give your technology provider the opportunity to succeed.
You have an amazing opportunity to change your whole strategy. Be 'Revenue Ready' and after all, ‘the future belongs to those who hear it coming…’
To join our industry's leaders and learn about becoming 'Revenue Ready' through all parts of your business, please register for our series of education webinars - places are limited, so please sign-up today: https://rightrevenue.co.uk/webinars
And for more information on the Right Revenue solution, please just ask@rightrevenue.wpengine.com