A major theme at Eye for Travel’s North America Summit in Las Vegas was disruption. Revenue Analytics’ attended this year’s event, co-sponsoring a booth while hosting an invitation-only dinner with Accenture Digital, and met with hotel, casino and airline companies.
Given the firms represented, this conference confirmed that the travel industry is undergoing a transformation similar to those in retail, media, automotive, and many more. However, what most companies don’t know is that they have the biggest asset available to them that can help to transform their business: their own data. The question remains, though: what can they do with their data to make better business decisions, and increase revenue without increasing risk?
Optimization. While attending the conference, I also had the pleasure of speaking as well, presenting on the topic Revenue Management is Dead. Long Live Revenue Management.
Below are three big takeaways from my presentation which align to our perspective on why the travel and hospitality industry need to embrace change in order to optimize and maximize profit:
1) Rethink Hospitality Revenue Management. Now! Hospitality and travel companies have remained complacent for years with their Revenue Management strategies, even though technology has evolved. Companies that don’t pursue Total Revenue Optimization with urgency will fall behind as competitors get there first.
2) Get on Track. Defining a strategy and driving towards a goal is critical for growth. To get on track, here’s what the future of Revenue Management looks like for the travel industry:
- Core RM technologies – reservations, sales, and inventory systems, along with distribution partners.
- RM Core – strategy, culture, transient, demand forecast, inventory controls, overbooking, and pricing recommendations
- Sales – group forecasting, group pricing, function space, lead scoring, incentive programs, and food & beverage menu offerings
- Marketing – marketing mix, syncing RM system forecasts, offers, promotions, and driving loyalty
- Distribution – channel mix, negotiated contracts, bundling, room type upsell, brand site conversion, and call center performance
- Brands – brand mix, franchisee mix, franchisee value, and market penetration
- Finance & Operations – staffing levels, outlets, restaurants, spas, space allocation, forecast integration
3) No More Excuses. Excuses are really failures with a capital F. I know the rationalizations used by people in organizations from my personal experience in large hospitality chains include: vendors, a centralized vision of technology, people, a lack of investment in technology and executives. Excuses don’t determine the path of your company. It’s time to take action with Total Revenue Optimization.
Across the travel industry, Revenue Management has made progress in recent years. Those who get ahead now will have the upper hand on their competitors for years to come.
Contact us to learn more about using disruption in the travel industry to your advantage, instead of to your detriment – or let your competitors eat your lunch and check out the pictures below from the event.