What is Revenue Management?

Revenue Management is an extremely important element in the hospitality industry. Revenue Management allows hotel owners to predict the demand in the market and optimize the availability and pricing accordingly. This is done in order to achieve the best financial results.

Breaking the term into a simpler format, it is selling the right room to the right audience at the the right moment, at the right price, via the right OTA, which will result in optimum efficiency.

Revenue management is sometimes called yield management. Though these terms are not interchangeable. Learn with RevAce, the best Hotel Revenue Management company in Delhi about what revenue management is.

Revenue management is interconnected by many components, like:

Customer segmentation: In this part of marketing the guests are segmented according to demographic criteria such as age, gender, marital status, the purpose of the trip, what are the spending habits of the guest, or the interests. It also includes whether the traveler is a new or returning guest to the property.

Demand forecasting: This information is the prediction of customer habits based on previous activities. This part involves the practice setting of the price bases on the demand. If you check the demand you might notice that there are certain fixed seasons when the demand is low and there are times when the demand is high. And when such times arise, the revenue manager knows when to act.

Yield management: This management requires the best price to sell the rooms along with maximum profits. There is a focus on the price as well as the profit.

Dynamic pricing: This involves changing the price in accordance with market demand. This involves selling the property on the following factors:

External factors: Such as competitor’s prices, weather data, and booking patters.

Internal factors: Such as segmentation, customer profiles, rates, etc.

This strategy involves the property to keep up with the market and maximize occupancy rate, as well as other revenue management KPIs.

Looking for revenue management services in Delhi NCR? RevAce can be the one you are looking for.