Doing The Math

As the hotel business witnesses accelerated change, revenue managers are developing innovative strategies to optimise demand and improve room occupancy

- Bindu Gopal Rao

An underlying premise that drives hospitality is profitability. With changing landscapes driven by an intensely competitive business dynamics, revenue managers are working on newer business models and techniques to strengthen pricing across all product domains to improve overall profitability.

The key to optimising revenues is to develop strategies that can spur demand and improve room occupancy. Occupancy again is dependent on demand and prices. Demand forecasting and appropriately managing rates, according to seasonal demand, can play a vital role in driving occupancy.

“Many hoteliers fail to forecast and gather the status for forthcoming months. It is always vital to know how many room nights you are picking up each day for every future date for at least up to three months. This has to be done for all the market segments of a hotel. This can help one make strategies in advance for all market segments and determine how many rooms to allot for each market segment,” said Chandrakant Shetty, CEO, VITS Luxury Business Hotels.

Stephanie Tanpure, VP, sales, Sands China added, “Today's consumers are inundated with information that is used to form decisions on where and when to book a hotel room. The ability to collect and analyse this information strengthens a hotel’s position as far as optimising demand and driving occupancy is concerned.”