TTT Best Pactices Forum Hotel Distribution 30 Nov 2010 FARO - Rate tiger
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  • If you recall I mentioned in 1999 Yield Management was the BUZZ.... The basic definition of YM used to be a balance of occupancy and rates to maximize revenue. But now with sophisticated systems and more data readily available……. Evolution
  • 10 years ago mainly sales to/through travel agents, tour operators, local corporate and alike All as before but also the web RM – full time / qualified or not qualified - uses tools RMS / channelmanager
  • Use slide 16 as notes to back-up this slide and delete 16. How does online distribution (OD) help improve Revenue Management strategies ? OD gives you the opportunity for more exposure through more websites. With the right tools like RT can control that OD – different rates and availability to different websites, over various date ranges. You can close the gap on your competitors, by proactively monitoring rates on multiple websites and on your competitors own site. Knowledge is power and OD can provide up-to-date information for critical decisions on rates and occupancy. RT will never replace a RM it will increase their efficiency
  • 54.2% of overall CRS bookings for the top 30 hotel brands come from the online channel, which is an increase of 6.6% vs. 2008 (eTRAK). 60% of leisure and 40% of business travel will be booked online this year (PhoCusWright). 45% of hotel bookings in 2010 will be via the Internet (direct + indirect online channels) (HeBS). _____________________________ In 2009, 70.9% of online bookings came from the direct online channel (i.e. the major hotel brands’ own websites), while 29.1% came from the indirect online channel (the Online Travel Agencies—OTAs) (eTRAK). This constitutes a significant increase of the contribution from the OTAs compared to 2008, when 75.2% of online bookings came from the direct online channel, while 24.8% came from the OTAs. Compare this to 2007, when the direct channel contributed 76% of CRS Internet bookings.

TTT Best Pactices Forum Hotel Distribution 30 Nov 2010 FARO - Rate tiger Presentation Transcript

  • 1. “ Making the most of IDS as part of your Revenue Management strategy” TTT Best Practices Forum Hotel Distribution Associação da Hotelaria de Portugal 30 Novembro 2010 | FARO – Escola de Hotelaria e Turismo do Algarve Pilar Sánchez Aita, RateTiger
  • 2. FASTEN MORE PRODUCT Brief History of e-Commerce
  • 3.
    • What do we know?
    • We know the internet is becoming more and more powerful and more of a necessity, rather than a luxury in our everyday lives.
    • We know that hoteliers are learning to use more Revenue Management (Yield Management) strategies.
    • What is Revenue Management
    • “ … Revenue Management is the process of understanding, anticipating and reacting to consumer behavior in order to maximize revenue or profits… “ (Wikipedia, April 2008)
      • Not simply the art of being the cheapest!
    The evolution of the Internet has enormous impact on Revenue Management Strategy
  • 4. “ How Internet Distribution Systems impact the way hotels need to view revenue management”
    • What influences consumer behaviour ?
      • Product In hoteliers’ control
      • Location A set parameter
      • Price In hoteliers’ control
      • Availability Driven by the market and the hotelier
      • Convenience In hoteliers’ control
      • Impression In hoteliers’ control
        • Conclusion: 5 out of 6 can be influenced by the hotel
  • 5. “ How Internet Distribution Systems impact the way hotels need to view Revenue Management”
  • 6.
    • Segmentation of client mix (corporate / leisure / weekday / weekend / etc.)
    • Balance between current occupancy and rates
    • Competitiveness of rates and ranking
    • Consider consumer benchmarking abilities
    • Market conditions (trade shows, events)
    • Forecast of future occupancy
    • Consumer trends & behaviour
    • Competition
    What the Revenue Manager must consider :
  • 7. Why work with IDSs?
    • Greater exposure
    • Segregation of inventory
    • Lower cost per acquisition compared traditional (GDS and Voice)
    • You want their loyal customers
  • 8. Return on your investment...
    • If your Average Room Rate is 100 euros per night..……
    • If you decided to update 10 websites ……….
    • If through greater exposure, you received just ONE extra room night per month from each site you work with……..
    • 100 x 10 x 12 = 12,000 euros per year would be generated.
    • It’s an easy decision to make !
  • 9. “ To position or not to position…” - Parity versus maximizing opportunities at producing IDS
    • Hotels have the choice now...
      • 1. Different rates at different sites
      • 2. Keep your rate parity at all sites
  • 10. “ To position or not to position…” - Parity versus maximizing opportunities at producing IDS Parity No Parity Uniformity at all websites Different rates @ Different sites No confused clients Clients could be confused Can’t optimise rates Can optimise rates; different channels sell differently - Different countries/incomes - Different selling power of channels No conflicts with travel websites Hotels have more control over Revenue Management / Strategy METASEARCH: doesn’t matter for hotels using rate parity METASEARCH: Transparency to consumers
  • 11. Recent booking trends and the impact on revenue management   Booking trend Impact on RM Growth of online bookings Focus on travel websites Growing number of travel websites Greater choice of distribution / product placement Greater choice of distribution / product placement More decisions to be made / more updates to be processed More decisions to be made / more updates to be processed More time consuming and more confusing
  • 12. Summary: Right time, right place, right price. Revenue Management in a world wide web.
    • Right Time – Consider:
    • Market conditions (trade shows, events)
    • Level of occupancy
    • Consumer trends & behaviour
    • Competition
  • 13.
    • Right Place – Research:
    • Global vs. national vs. regional extranet?
    • Offline vs. online?
    • Question: which extranets produce at the Right Time?
    Summary: Right time, right place, right price. Revenue Management in a world wide web.
  • 14.
    • Right Price – Manage:
    • Segmentation of client mix (corporate / leisure / weekday / weekend / etc.)
    • Balance between occupancy and rates
    • Competitiveness of rates
    • Consider consumer benchmarking abilities
    Summary: Right time, right place, right price. Revenue Management in a world wide web.
  • 15.
    • Where is my business coming from?
    • Who are my competitors and how do I compare?
    • Which channels do I need to work with?
    • What should be my pricing strategy?
    • How or how often should I update my distribution channels?
    • How do I monitor results?
    … Ask yourself… Online RT Strategy
  • 16. Market – Online Distribution Market Overview Demand Segments Channels of Distribution Airline CRS (GDS) Switch Hotel CRS Hotels Travel Website Travel Agents Sabre WorldSpan Amadeus Galileo Pegasus Chain CRS Representation Company Chain Franchises Independent Properties Event Management Companies Call Centers Travel Websites CORPORATE TRAVEL GROUP CONVENTION LEISURE TRAVEL Hotel/Motel Groups Independent Hotels Resorts Inns, B&B’s RT Integration RT Integration I-CRS TRADITIONAL INTERNET BASED Who will help to manage this chaos ?
  • 17.
    • WHO ARE WE ?
    • RATE TIGER – We build software for hotels (since 2001) that
      • Simplifies competitor analysis
      • Centrally manages rates and availability
      • Automates revenue management
    • Products for Hotels, Hotel-Groups / Chains, Hostels and Distribution Channels
    eRevMax Inc. / Rate Tiger - Key Facts
  • 18. RateTiger Product Suite Helping hoteliers to better manage online revenue and distribution ... RT Strategy
  • 19. Products
    • Benchmarking for Hotels / Groups / Travel sites
      • Competitor rate information on travel and hotel sites
      • Weekly report or online real time (both accessible at any time)
      • 300 websites connected / 3,000 hotel sites configured
      • Several packages available
    RT Strategy
  • 20. Products
    • Rate & Inventory Allocation
      • Manage multiple travel websites in one screen
      • Optional status quo (Pro version)
      • Currently over 250 sites
      • Several packages available
    RT Strategy
  • 21. Products
    • Low cost revenue management system
      • Based on how hotels determine rates
      • Three strategies
      • Lowest rate guarantee available for all strategies
      • Additional features
    RT Strategy RT Strategy
  • 22. … OR very simple … Without RateTiger With RateTiger Time consuming process? You can’t add more sites? Confused? With RateTiger you will Manage More by Managing Less
  • 23. Top 8 Tips for Effective Revenue Maximization
    • Drop Rates Carefully
    • Do not ignore historical data
    • Invest in technology
    • Treat IDSs as your partners
    • Use effective channel partners
    • Automate allocation process
    • Experiment with different IDSs
    • Always focus on a mutual win, and this in turn will build trust and loyalty
    Expedia Orbitz hrs City.com Country.com Rates & Inventory Benchmarking Channel Partner
  • 24. Obrigado Thank You Pilar S ánchez Aita Tel : +34 91 127 1779 Fax: +34 91 547 7187 E-mail: [email_address] Web: www.ratetiger.com