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Revenue Management - Strategies to improve your sales in difficult times COVID-19 / Coronavirus

Updated: Feb 21, 2023

"Revenue Management in times of COVID"

The unofficial definition of Revenue Management used by its initiators is defined as "the art of turning down business." This certainly does not apply during the current global health crisis of COVID-19 or Coronavirus and the economic recession facing the Tourism and Hospitality Industry. As a consequence, all professional strategies and traditional practices are out of the game at this time. So what should we do?

Revenue Management for hotels has become more of a business and marketing focus function than anything else, focusing on generating demand and drawing attention to your storefront. It is not the typical role that a Revenue Manager is used to and I am sure that many professionals in Revenue Management face the enormous challenge of changing the speed in terms of their pricing and distribution strategies.

First of all, we find ourselves in a position where we cannot wait for business to arrive at the Hotel's doorstep, our mind should be in proactive mode, rather than the usual kind of reactive thinking that we are used to. Now more than ever the competition is tough, prices have dropped and you are competing to fill the entire inventory of the Hotel. Exploding each and every room is the mentality that distinguishes the true victors.

That is why we bring some of the best strategies and practical tips that can help us to be victorious in this competitive financial crisis.

"Watch your neighbors"

During times of economic crisis or recession, you should always open your eyes and expand your mind to the alternatives, explore the Internet, for example, look at the websites where your competitors appear or look for the best hotels in the destination and analyze how they are come online. Chances are, you will discover some new digital channels or ecommerce travel sites that you have never heard of before.

In any case, you should consider conducting an ongoing sales channel audit, be it weekly, monthly, bi-monthly, or even quarterly. In this way we can take advantage of these innovative ideas and gain exposure on new platforms, putting your hotel on an equal footing with its neighbors.

"Fish where the fish are"

The most listened to news in all the exhibitions and webinars of the great experts tell that travel is changing globally for the foreseeable future. We are experiencing a drastic decrease in long distance travel and instead consumers are concentrating on destinations "to a road trip".

So what states, cities, and countries are on your side? Have you already done a local search, in your base language version on Google, Bing or Yahoo? Have you tried using a VPN so that you can see the results as if you are actually in the neighboring country? These outside perspectives can help you understand how neighboring countries see you and how easily you find them, so you don't neglect their sales opportunities.

Our GCBH Revenue Management and Hotel Strategy team has been able to identify "new" distribution channels in this way; that began to produce a few days after its launch. We recommend doing this exercise for any hotel, in any destination!

"Exhibition in all the showcases"

Although, we are already more than familiar with sales strategies with online agencies (OTAs), as well as the importance of our direct channels, such as our own website and reservation center, which help to improve our online positioning. However, we must not forget that online channels are just one of the many distribution channels available, there are other options such as: working with distribution platforms of wholesale agency agreements, affiliations to travel clubs, consortia, corporate agreements and more. .

These agreements help to grow market penetration to reaches that alone would be very difficult to achieve, since in addition to offers to both physical and online travel stores (which in turn offer advertisements in specialized magazines, newspapers, hotel catalogs) attend travel fairs and exhibitions and endless alternative platforms.

So you must remember that there are many means of distribution to keep all the rooms in your hotel occupied. If you want to learn more about these sales channels, do not hesitate to contact our GCBH Sales Management team, we will gladly help you find tailor-made alternatives for your Boutique Hotel.

"Maintain high rates and brand positioning "

We know perfectly well that the idea of ​​maintaining our ADR (Average Rate) in these types of situations sounds like an old-fashioned and unorthodox idea, keeping our rate high manages to position the hotel within the correct niche of clients, allowing travelers of its stratum social find the right comforts and experiences for your travel style, thus making it easy to find the right hotel according to its price.

If it is true, maintaining the rate works to segment our target customer (objective), but we must also consider analyzing the pricing strategy of its neighbors, in order to keep their prices always competitive, thus ensuring that we will maintain the occupation and income necessary for the hotel operation and moreover this allows your Revenue Management team to prioritize opportunities for additional strategies to offset ADR based on healthier occupations.

These alternative strategies could include diversifying different discounts through the sales channels that we have available, prioritizing maintaining high rates in public channels, offsetting the average rate and maintaining brand positioning.

"Added values"

Our clients currently seek accommodation for various reasons, however, the case of leisure travelers is well studied, who are mostly influenced not only by a beautiful room, but by the complete experience that their hotel offers.

Contrary to the main strategy of reducing the price of our rooms to be able to sell them, our advice is to review what experiences of value you can add to your guest's stay. We must use the services and facilities of your hotel to create an enriched and attractive experience for our clients.

Well then, you are wondering, is it worth selling a room when you add dinner and a bottle of wine at cost price?

Let's review a practical example, let's say our regular room rate is US $ 150 and a romantic dinner on the beach and wine adds up to US $ 100. Together they give a total of $ 250. What if we sell it all for $ 190, since the cost of dinner and wine is really $ 40? This would be equivalent to a 24% discount in total, so, it is the same if you sell your room with a discount offer, however, this type of offers keeps the sale price high from the customer's perspective, taking care again our brand positioning, at the same time that the client obtains a much more complete experience of their property.

I therefore recommend that you check what added values ​​you can combine to the current offer and do not hesitate to publish these offers in advance before discounts and promotions, especially on the hotel's website. And promote them on social media, as well as Google ads.

"Rates Micro-management"

Indeed, we must continue to manage the rate strategy even at small levels during these extremely troubled times. There are days when certain types of rooms sell faster than others and this is an excellent opportunity to slightly increase the rate supplements and earn additional income or, if they sell slower, lower it a bit.

The management of rates even at this level, as well as the revision of the supplements by type of room will have a positive impact on the ADR of each room. And right now every detail counts more than ever.

"Check your travel conditions, be flexible"

Due to the uncertainty of the latest news, as well as the travel restrictions that several countries have adopted, customers have a clear and defined tendency to prefer rates with more flexible reservation and cancellation policies, so we recommend that you review the conditions of their reservations in terms of prepayment and cancellation. We have to make sure we are competitive in your market, as well as with the rate strategy. The Resorts and Hotels in leisure destinations that generally have stricter deposit and refund policies, have chosen to consider making their rate rules more flexible, due to the high demand for these, within the conditions those that are totally flexible are considered, offering reservations without guarantee deposit and allowing cancellations without penalties up to 24 hours before arrival.

Flexibility definitely affects your ability to convert visitors to reservations for your hotel, both on OTAs and on your own website. However, it is very important that you take an internal measurement of your last minute cancellations, in order to understand the behavior of your guest and to be able to make adjustments where necessary, as we do not lose too many reservations with last minute cancellations.

"Metasearch and Sales Listings in Indexers"

Of course, the main objective of every Hotel should be to increase direct sales, reducing the cost of acquisition which is severely increased by commissions from channels such as OTAs. For those who hesitate to invest in marketing clicks, there are alternatives such as Google Hotels, which has innovated with a commission payment model for its hotel ad platform.

The Pay Per Stay (PPS or Payment per Stay) model even allows you to report cancellations and no shows to control costs, this model suggests a solution to Traditional Marketing investments where it requires a certain strategy when creating Ads, so that they work and generate return on investment. So do not hesitate to consult our GCBH Electronic Commerce team if you want to know more about this option.

"Promote seclusion"

Properties in secluded locations are in demand this year. Most of the time, properties close to nature are outperforming their counterparts in bustling city centers.

Exclusion from the rest of the world and creating private experiences just go a long way this summer.

However, seclusion goes far beyond a private and secluded place, the ability to create a sense of intimate pleasure and relaxation in the open air is very useful. Smaller properties with gardens, rooms with private balconies, rooms with comfortable and spacious dining rooms, and even apartments with kitchenettes; All of these elements offer the comfort of possible isolation and individual experiences.

So whether you have a large garden with a pool or immediate access to outside activities, this is the time to boost them in your marketing, sales and distribution actions.

"Get ahead of the game"

In times of crisis, when things get tough and we are pressured to move from right to left, it is key to stay focused and not lose control.

Have you already loaded your 2022 fees? Be sure to do so to start building a base of both individual and group guests as far away as possible, with most clients in countries with heavy and limiting restrictions, destination weddings that were pushed into the next year, and clients who are waiting to receive the vaccine to travel, all of them will look for their reservations in the future, so let's not lose focus and get ahead of the situation, generating the occupation bases that will sustain our strategy tomorrow.


Get creative with your distribution and revenue management strategies and drive sales across all areas of your hotel. This is not the time to sit and wait for the business to come through the door, let's avoid falling into traditional techniques, but let's not be afraid to maintain our brand positioning (just like the old school), let's be analytical and play to be competitive, let's take the initiative and gain the advantage over the market.

I hope these practical tips can help you improve your strategy in these difficult times and that you can find the expert help you need from us.

The most valuable thing that we will obtain from all this is the experience, which will help us navigate any new obstacle that we can overcome.

This situation is without a doubt a unique phenomenon that we are experiencing, so it requires thinking outside the box. Educate yourself and find the resources to gain the upper hand, read the local and international news, review financial analysis and predictions from experts in economics and tourism, learn to adapt and be flexible, setting small goals that inspire you to continue filling the rooms from your hotel.

We are here to help, so don't hesitate to contact us.

Christopher Ramirez, Director of Strategy


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