REVENUE MANAGEMENT: LOOKING AHEAD TO AVOID BEING LEFT BEHIND

Big Data offers real-time opportunity to analyse guests searching for a specific destination and their spending power, helping revenue managers set the right room rate to attract the right customer

- FULVIO GIANNETTI

In recent years, the tourism industry has been disrupted by a strong push for innovation, thanks to the introduction of new technologies and greater managerial awareness of their necessities. As is often the case, new technology evolves quickly in times of lack to solve or address the issues that the industry is facing at the time.

It is important to recap some pertinent developments to better understand the parts of technology that are necessary for hoteliers and which ones can be put aside for another day. So, let’s start at the beginning.

THE BIG DEAL ABOUT BIG DATA

Big Data is a relatively new concept in the tourism industry and, as such, there is still a great deal of confusion as to what it is and how it helps hoteliers get more bookings and revenue. I will give you a simpler definition and explain why it is key for the future success of revenue management.

Big Data is, quite simply, a huge amount of data – including email, data from images, text, search, etc. – that can be either structured (i.e., presented using tools like Excel) or unstructured. The vast use of cloud services combined with the volume of data has resulted in the term Big Data – simply because the scope and complexity of the data available are beyond the human mind to compute in a time-effective manner. The interconnection of systems, combined with the infinite capacity to store data at low prices, has opened the door to the democratization of Big Data, which was previously the exclusive domain of only a few.

Until recently, Big Data was the key element missing, but highly necessary, to complete and perfect the modern revenue management processes, revenue management systems, and strategies. Thankfully, today, we have the technology to support revenue management completely.