The Importance of Total Revenue Per Guest

Nicole Adair, Area Director of Revenue Management for SHR, is a featured author this month on Hotel Business Review. Preview her article on the Importance of Revenue Per Guest below:

As a revenue management professional, it can become all too easy to get bogged down in focusing on rooms revenue in efforts to increase ADR and drive RevPAR. After all, these are the metrics by which we compare against our comp set on weekly STR reports and, quite often, the numbers used to grade our performance. However, as the practice of revenue management matures, and an increasing number of technology companies are providing the industry with newer and more optimal functionality, the focus needs to shift from primarily revenue generation to optimizing total profitability of the whole hotel. This requires that we alter how we view the role of revenue management, and the following are some things to keep in mind as you look to grow your hotel’s bottom line:

Optimize Your Rooms

The first step in total revenue management is ensuring that your rooms are optimized. We all monitor how we are priced against our competitors, but what about how your own rooms are priced against each other? Take the time to review your room type pricing differentials, making sure to capitalize on easy opportunities for rate growth by reclassifying select units based on location, view, and upgraded amenities. After reviewing your room types and pricing, you must make sure to pay attention to your room type descriptions. Do they properly communicate value and bedding options in a manner that creates an inviting booking experience for the guest?

Enhance Connectivity

One area that often ends up on the backburner is proper channel set up and ongoing maintenance. If your guest rooms can accommodate more than the default of two guests, make sure that both and OTA partners have the extra adult functionality enabled with a corresponding upcharge. It is worth the time to perform an audit of all of your hotel’s connectivity set up. Do you have proper room and rate parity across all of your channels? Research your CRS provider options, as there are innovative connectivity options out there that will allow for seamless two-way interfacing with both your third-party partners and your property management system, delivering real-time availability, rates, and inventory so that you can focus your revenue management efforts on strategy and then implement it once across all channels.

Click here to read the full article.