For hoteliers, pricing can be a dizzying task, especially how the cost of the same room at the same time can vary dramatically from one date to the next. Especially for the dates that have some important events scheduled. Events and holidays are a high business period for hotels.
However, there is definitely a technique to the seeming craziness.
Travel is one of the most sought after ways to spend a holiday. Events and holidays present an immense opportunity for hoteliers to increase their hotel bookings and revenues. Thus, hotels should definitely keep a tab on the upcoming events in their city & locality and holiday season also for their city and their different source markets.
In this article, we will be discussing the importance of tracking events and holidays for a hotelier and its impact on hotel bookings and revenue –
Hotels implement their pricing based on many different factors including the market they are operating in; a very significant one of them is events and holidays that may affect their demand for rooms and the room types they have to sell. Prices for rooms may change significantly every single night basis these factors.
The guest mix in a hotel may also affect whether room rates go up or down. For illustration, vacationers might be more price sensitive than business travellers.
In fact, different hotel types also get impacted differently. A business hotel will get huge bookings if an important business event or a conference is planned in their city or locality and might get least impacted by a festival or social event coming up on a weekend or a holiday on an extended weekend.
However, a leisure or family hotel will be impacted in a different manner, for example, they will witness more demand on weekends, extended weekends, holidays and any festival or on the dates of any local event being planned.
This is also followed by room type being sold; families prefer king size rooms or twin beds, whereas business travellers book single occupancy rooms more.
Therefore, both these hotels will not only have a different booking pattern during the week, but also a different booking pattern for different room types. Accordingly, their pricing strategy will vary for each date and room type.
Irrespective of these variables, delivering great customer value is key for any hotel operator and fair pricing is a critical component in that equation. However, at the same time generating maximum profit is the core of any business.
Big concerts, sports events or a major business conference, are all boon for the host city. Hotel bookings rise to as high as 200% or more depending on the importance of the event, increasing the room prices many folds.
Keeping a track of important events for future dates, helps Revenue Managers plan their inventory stocks and prices for different time slabs from the actual event date/check-in date.
This planning will certainly help them generate more revenue. For example, for annual fests/fixed events which are popular, travellers start booking them months in advance, thus it is a good time for hotels to make more revenue and it is smart of them if they keep a major percentage of their inventory open to booking say 4 months prior to check-in dates. Keep a small percentage of high priced room inventory just close to the event date.
Same will apply for the big business events, preparation for which starts at least 6 months in advance. Otherwise, business hotels usually make maximum revenue on last minute bookings.
It is not a bad idea if hotels also promote an event in their city and entice travellers with offers like free passes to the event in case your guest book 2-3 nights stay in your hotel.
Revenue Managers don’t ignore the fact that events and holidays are not meant just for outstation travellers. Local guests also contribute significantly to your room bookings and other revenue mediums like spa, restaurants, etc. for people looking out for a relaxed stay-cation in their local city.
Technology solutions are the best way to ensure that your hotel has the maximum visibility during the high-traffic holiday season. By listing your property on as many OTAs as possible, you can increase the number of ‘eyeballs’ seeing your hotel – and thus the online bookings.
It is not possible to manage a large number of online distribution channels manually – and that is where technology comes in handy in the form of a cutting edge online distribution manager and rate shopping tools.
There are Rate shopping tools for the perusal of hoteliers that allows them to add all the important events in their calendar or rate-shopping card. Not only this, such systems also allow you to mark the importance and impact (Popularity Index number) of these events on your hotel bookings. This greatly helps hotels design their pricing strategy for these specific dates.
Keeping a close track on events saves RMs from losing that extra revenue that they can earn on the table, but not at the cost of low occupancy.