As a hotelier, you’re likely well aware of the importance of both revenue management and marketing to the success of your hotel. But have you ever considered the impact that alignment between these two departments can have on your bottom line? At For-Sight, we believe that the alignment between revenue management and marketing is crucial for the success of any hotel.
Understanding Revenue Management: Optimising Pricing and Inventory
Firstly, let’s consider revenue management. At its core, revenue management is all about optimising pricing and inventory to maximise revenue. To do this effectively, revenue managers need to have a deep understanding of market demand, as well as a good understanding of their hotel’s internal metrics, such as occupancy rates1 and RevPAR2. Revenue managers also need to be able to make quick decisions based on changing market conditions and other factors.
The Role of Marketing: Promoting Your Hotel and Building a Strong Brand
Now let’s consider marketing. A well-executed marketing strategy not only attracts new guests but also encourages repeat visits and fosters brand loyalty. Marketing professionals need to be creative and strategic, and they need to have a good understanding of their target audience and what will appeal to them.
Marketing is a multifaceted discipline that encompasses various channels and tactics, such as:
- Email Marketing
- Content Marketing
- Social Media Campaigns
- Targeted Advertising
- Public Relations
By taking a comprehensive, guest-centric approach to marketing, hoteliers can differentiate their properties, create lasting connections with guests, and drive long-term success in an increasingly competitive landscape.
So why is it important for revenue management and marketing to be aligned?
Well, for one thing, revenue management and marketing are closely related. When revenue managers make decisions about pricing and inventory, those decisions can have a big impact on the effectiveness of marketing campaigns. For example, if a revenue manager decides to lower prices to boost occupancy rates during a slow period, that could make it easier for the marketing team to promote special deals and packages.
But it’s not just about the impact of revenue management decisions on marketing. Alignment between these two departments can also lead to:
- Increased Revenue: When revenue management and marketing work together, they can create a pricing strategy that balances demand with rate optimisation, resulting in higher revenue for your hotel. By coordinating promotions and special offers that complement your revenue strategy, you can drive more business while maximising profits.
- Improved Guest Experience: When these two departments are aligned, they can ensure that guests are receiving the best value for their money. This translates into a better guest experience and increased loyalty. With the right hotel CRM software, you can collect and analyse first-party data to learn more about your guests’ preferences, spending habits, and behaviour. This information can help you craft personalised offers and promotions that cater to their needs and create a positive guest experience. For example, with For-Sight’s CRM & Marketing Solution, you can easily design and report on email marketing campaigns to promote offers during low occupancy periods, thus encouraging guests to book and fill your rooms while providing them with a discount or perk such as a complimentary breakfast or a 20% discount on spa treatments.
- Better Utilisation of Data: Revenue management and marketing teams have access to different data sets, such as pricing and demand data. When they work together, they can use this data to make informed decisions about pricing, promotions, and distribution channels. By sharing first-party data, you can gain insights into your guests’ preferences and behaviour, allowing you to optimise pricing, customise offers, and target the right audience. For example, if the marketing team notices that a particular promotion is driving a lot of bookings, they can share that information with the revenue management team, who can then adjust pricing and inventory accordingly.
- Increased Competitiveness: By aligning your revenue management and marketing strategies, you can gain a competitive edge over other hotels. You can craft a pricing strategy that meets guest demand while maximising revenue, create targeted promotions that resonate with your guests, and optimise distribution channels to reach the right audience. By leveraging first-party data, you can also gain valuable insights into your guests’ behaviour and preferences, allowing you to create a personalised experience that sets your hotel apart from the competition.
In conclusion, the alignment between revenue management and marketing is critical for the success of your hotel. By working together, you can increase revenue, improve the guest experience, better utilize data, and gain a competitive edge. Make sure to invest in the right hotel CRM software that allows you to collect and analyse first-party data and start coordinating your revenue management and marketing strategies today!
If you are keen on hearing how the For-Sight CRM & Marketing Solution can support your marketing campaigns to allow you to develop deeper and more meaningful relationships with your guests, we would love to have a conversation. Book a free demo here
1 Occupancy rates: A measurement of a hotel calculated by dividing the total number of rooms occupied by the total number of rooms available times 100, e.g., 75% occupancy.
2 Revenue per available room (RevPAR): Calculated by taking the average daily room revenue (ADR) of a hotel and dividing it by the total rooms available at that hotel. (Source: SiteMinder)