Exploring the Potential of Increased Bookings through Channel Management

The enjoyment of working in hospitality originates from entertaining visitors, not interacting with systems. If you spend hours daily on routine duties and are concerned about overselling your rooms, a channel manager booking system may be for you.

A hotel channel manager booking engine is a software system that connects a hotel reservation system to distribution channels like online travel agencies (OTAs). The information then flows, changing rates and availability and retrieving reservations to reduce the risk of overbooking, manage rate parity, and make it easier to sell rooms online.

Channel managers provide several benefits, including enhanced online exposure across more booking channels, better rate and inventory control, a lower chance of overbooking errors, and the ability to quickly modify pricing based on demand. This results in higher occupancy rates, more revenue, and improved operational efficiency.

Read along to learn more about hotel channel management and its impact on hotel bookings!

Understanding Channel Management in Hospitality

Channel manager booking systems are software solutions that allow hotels to manage room inventory and rates across multiple online booking channels simultaneously. By centralizing distribution, channel managers simplify the reservation process and synchronize availability and pricing across channels in real-time. This eliminates overbookings, rate inconsistencies, and the need for manual updates.

Channel manager booking engines connect a hotel’s property management system (PMS) with OTAs, global distribution systems (GDSs), and websites. This integration facilitates two-way booking data and inventory status communication between different systems.

Benefits of Effective Channel Management

A robust channel manager booking system simplifies distribution by centralizing inventory and rate management across multiple online booking channels and hotel websites. Automates tedious manual tasks, saving staff significant time and effort.

Here are a few more benefits of effective hotel channel management:

• Maximizes Revenue: Enables dynamic pricing to optimize rates based on demand, seasonality, events, etc. Expand distribution through increased visibility across more booking channels. Prevents revenue leakage from overbookings and rate parity issues.
• Enhances Guest Experience: Synchronized rates and real-time availability across channels improve booking experience. Reduces chances of over-promising rooms already booked. Allows staff to focus more on delivering excellent guest service.
• Data-driven Decisions: Reporting provides actionable insights into channel performance, booking patterns, and guest profiles. Helps identify the most effective marketing channels to allocate the budget. Assists in shaping pricing strategy and other revenue management tactics.
• Future-proofs Hotel: Positions hotels to leverage emerging technologies like AI and automation to reshape hotel channel management. Flexible API platform simplifies integrating new capabilities as they emerge to stay competitive.

Enhancing Guest Experience with Channel Management

Here are some of the key ways that effective hotel channel management enhances the guest experience:

1. Consistency in Rates and Availability

   Hotel channel management synchronizes real-time room rates, promos, and availability across booking channels and direct hotel websites. This allows guests to see up-to-date, consistent information regardless of where they search, building the confidence to book directly with the hotel.

2. Reduced Overbooking Issues

   The automatic inventory updates ensure the same room is not overbooked on multiple sites. This prevents the hotel from having to walk guests when oversold or scramble to accommodate them. Avoiding this negative experience is pivotal.

3. Increased Personalized Service

   Channel manager booking system automates much of the distribution, rate, and inventory management. This frees up the hotel staff’s bandwidth to focus on delivering excellent personalized service and experiences during the guest’s on-property stay.

4. Enhanced Guest Profiles

   Channel manager booking engine’s data and analytics provide insights to help hotels better understand guest preferences, demographics, and behaviors. Enables staff to tailor services and offers to delight repeat guests.

5. Positive Reviews

   Seamless, consistent booking experience and avoidance of on-property issues stemming from overbooking or rate confusion indirectly lead to more positive guest satisfaction reviews. This attracts more potential guests on OTA and travel sites.

Optimizing Revenue and Operations

By optimizing the entire distribution system, channel manager booking systems create a foundation enabling hotel staff to deliver consistent and exceptional service levels that create memorable guest experiences.

Also, here are some of the key ways hotels can optimize revenue and operations using an effective hotel channel management strategy:

• Dynamic Pricing: Leverage real-time rate updating across channels to implement demand-based, dynamic pricing. Set room rates based on current occupancy %, days to arrival, competitive rates, etc. Maximize rates when demand is high.
• Promotions Management: Run special offers like advance purchase rates or last-minute deals seamlessly across multiple booking channels. Easily change promo codes, discounts, and packages across all connected platforms simultaneously.
• Channel Mix Optimization: Use the channel manager booking engine’s analytics to identify your most profitable booking channels. Adjust the distribution mix to drive more bookings through the highest revenue-generating sources. Reduce reliance on high-commission OTAs when possible.
• Length-of-Stay Control: Implement minimum night stay rules to require longer average length bookings during peak demand. Drive more room revenue without needing to sell more room nights.
• Group Block Management: Utilize group rate codes and room block allocations by arrival date. Configure channel manager booking system to automatically open room inventory to public sale after cut-off dates. Reduces waste from unused group blocks.

Best Practices for Successful Channel Management

Here are some best practices for hotels to ensure successful hotel channel management:

1. Choose Robust, Dedicated Software

   Select a channel manager booking system for hotels, not a generic multi-industry tool. Ensure tight integration with major property management systems to enable real-time rate and inventory syncing.

   The platform should connect with leading OTAs and metasearch sites, offer rate shopping capabilities, and provide actionable reporting on channel performance. Reliable training and support resources are invaluable.

2. Actively Optimize Channel Exploitation

   Treat your channel manager booking system as a dynamic revenue generation engine, not just a distribution tool. Continually adjust channel mix to emphasize the most profitable sources, tweak pricing algorithms based on demand shifts, and run special promotions to stimulate sales during slower periods. Use analytics insights to refine overall distribution strategy and budget allocations towards top converting platforms.

3. Maintain Rate Parity Across Channels

   While allowing some flexibility, ensure general rate parity across channels to avoid customer confusion and price erosion. When running promotions, leverage the channel manager booking system to efficiently roll out consistent percentage discounts across multiple sites. Don’t undercut yourself.



4. Incentivize Direct Bookings

   Use a channel manager booking system to offer exclusive deals, packages, and loyalty rates to encourage direct hotel website bookings. Direct bookings avoid OTA commissions, building more profitable customer relationships. Configure appropriate availability thresholds before opening up inventory to OTAs.



5. Dynamic Competitor Rate Benchmarking

   Employ rate shopping tools to continuously monitor competitor pricing across channels. Leverage analytics to assess rate position; adjust prices algorithmically based on competitiveness, channel source, demand forecasts, and other factors.

6. Keep Listings Fresh and Appealing

   Channel manager booking engines should distribute rich, engaging content like room images, amenity details, area attractions, etc, for your property. Regularly refresh messaging and visual assets across all connected platforms to capture guest interest and booking conversion.

Overcoming Challenges in Channel Management

Many independent hotels utilize outdated on-premise PMS channel manager booking engines that lack modern APIs for connecting with channel manager booking engines and other systems. This makes establishing real-time rate/inventory syncing difficult.

To solve this, you can seek a cloud-based channel manager booking system that offers adapters, middleware integration capabilities, or custom integration services to interface with the legacy PMS channel manager booking engine. While more complex, bidirectional data flows can be established.

Here are a few more hotel distribution challenges that hotel channel management helps solve:

1. Reducing Dependence on Large OTAs

   Smaller hotels often rely heavily on a handful of OTAs like Booking.com and Expedia for most bookings, severely limiting bargaining power on commission rates.

   Solution: Leverage channel manager booking system’s analytics tools to determine various distribution sources’ conversion rates and true profitability. You can also shape marketing efforts towards driving more direct bookings via the hotel website. Moreover, actively adjust the channel mix over time by culling underperforming OTAs and adding alternate platforms.

2. Maintaining Dynamic Rate Parity

   Manually updating room rates across many channels inevitably leads to discrepancies over time that undermine revenue and confuse guests.

   Solution: Utilize robust rate shopping capabilities within enterprise-grade channel managers that continuously scrape competitor and indirect channel rates, then provide recommendations or even automatically adjust a hotel’s prices across connected platforms to maintain rate parity.

3. Overcoming Resource Limitations

   Many boutique hotels lack dedicated distribution staff to actively manage channel inventories, campaigns, and rate strategies across a complex technology stack.

   Solution: Prioritize hotel channel management solutions that minimize manual overhead after initial configuration using templates, pre-built automation, and workflows. Seek systems with intuitive interfaces and comprehensive monitoring/analytics for streamlined oversight.

4. Unifying Data Systems

   Disparate hotel platforms lead to fragmented guest data that hampers CRM initiatives and single guest view.

   Solution: Evaluate channel manager booking systems featuring open API architectures, allowing deep-level integration across the hotel’s central property management system and other applications like reservations, POS, loyalty systems, etc. Unified data availability improves guest service.

Future Trends in Channel Management

​​The increasing use of mobile devices for travel bookings necessitates a mobile-optimized hotel channel management experience. Hotel managers must ensure their hotel channel management systems are user-friendly and accessible on mobile devices. A few more trends that are predicted to dominate the hotel channel management industry are:

1. Artificial Intelligence (AI) and Machine Learning (ML)

   AI and ML will be increasingly prominent in automating tasks, optimizing pricing strategies, and personalizing guest experiences. Hotel channel management systems will leverage AI to:

   • Dynamically adjust rates: AI can automatically analyze market trends, competitor pricing, and guest behavior to automatically set the most profitable rates across different channels.
   • Predict demand: ML algorithms can analyze historical data and market trends to predict future demand, allowing hotels to adjust their inventory allocation and pricing strategies accordingly.
   • Personalized marketing and promotions: AI can personalize marketing campaigns and promotions based on guest preferences and past behavior, leading to increased conversions.

2. Open APIs and integrations

   Open APIs will enable seamless integration between hotel channel management systems and other hotel software, such as PMS channel manager booking engine, revenue management systems (RMS), and guest relationship management (CRM) tools. This will create a more unified data ecosystem, streamlining operations and improving efficiency.

3. Voice Search and Chatbot

   With the growing popularity of voice search and chatbots, hotels must adapt their hotel channel management strategies to cater to these new guest preferences. This may involve integrating voice search capabilities into booking channels and utilizing chatbots to answer guest inquiries and facilitate bookings.

4. Direct Booking Strategies

   As hotels strive to reduce commission costs associated with OTAs, there will be a continued focus on encouraging direct bookings through the hotel’s website or app. Hotel channel management systems can support this by offering features such as:

   • Best rate guarantees: Ensuring the hotel website always offers the best rates compared to other channels.
   • Targeted promotions: Offering exclusive deals and discounts to guests who book directly.

Conclusion

The hospitality industry has fully embraced channel technology to adapt to the digital shift in how travelers research and book accommodations online. Channel managers now play an indispensable role for hotels in streamlining operations, driving direct bookings, and keeping pace in an increasingly competitive marketplace.

Their continued evolution and integration of emerging technologies like AI promise to revolutionize hotel channel management capabilities further in the future.

Frequently Asked Questions

What are some common challenges hotels face when implementing channel management?

Hotels often encounter integration complexities, staff training requirements, and consistent pricing and availability across various channels. Balancing direct bookings with third-party channels and addressing real-time update issues are common implementation hurdles.

How does channel management contribute to enhancing the guest experience?

Hotel channel management ensures accurate availability and pricing, provides real-time booking confirmations, and enables personalized offers, leading to a smoother and more engaging guest experience.

How do I choose the right channel management solution for my hotel?

Select a solution based on compatibility with existing systems, scalability, user-friendly interface, real-time updates, support, and cost-effectiveness for optimal results.