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Rate Shopper guide for Hotel Pricing Strategy

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A Guide to select Hotel Rate Shopper that is holistic & well suited for today’s environment.
This exclusive Hoteliers' Guide will help you answer the following questions:
* What is the significance of Rate Shopper Tool?
* Why should you have a Rate Shopper?
* What are the basic & though advance(but must have) features
of your Rate Shopper?
Read the complete guide to know in detail.

Visit our website: https://rategain.com/

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Rate Shopper guide for Hotel Pricing Strategy

  1. 1. A Guide to choose Rate Shopper Tool rategain.com marketing@rategain.com rategain.com
  2. 2. A Guide to choose Rate Shopper Tool rategain.com Who can benefit from this best practice guide? Revenue Managers/Directors, Hotel General Managers & Hotel Owners can benefit from this guide along with all the other hospitality industry professionals, who are responsible for sourcing a range of rooms at competitive and comparable rates and have to monitor rates from multiple sources like GDSs, Meta search sites, OTAs etc. Perishability and limited inventory are the two most important aspects of hotel business. So pricing of a room automatically becomes one of the most important KPIs for a Revenue Manager. There are multiple aspects that influence pricing viz- compset, market supply, reviews and ratings etc. As a result, hotels cannot be living in silos. Rather, they have to constantly monitor their competitors’ prices and offers. It is no secret that hotels today offer multiple rates combined with multiple room options. Besides, in order to track the competition, they multiply this number to the total number of competitor hotels which need to be tracked. The aforementioned activity cannot be achieved manually. Here arises the need for an automated price shopping tool. After all, collecting and analyzing this data is a time- consuming, costly and ineffectual process for those who take it on without proper automation tools. 01 Rate Shopping is a Crucial Part of a Successful Revenue Management Strategy
  3. 3. A Guide to choose Rate Shopper Tool rategain.com 02 Price Pellucidity: Prospective guests today consider their target hotel’s online reputation as well as price on all the OTAs, before determining the value of their choice. Hence, price no longer equates to quality. Demand is a Function of Price: Hotels need to understand that pricing strategies are highly influenced by demand, which has become a function of price. But they should not forget that demand is also a function of reputation. Reputation Pricing: Hotels today are highly impacted by social media platforms. These platforms can be used to influence the consumer and their purchasing decisions. Your real competition is just based on the distance or star category or there is another set of online competition Competing on price alone, is it a winning strategy? Let us find out. Challenges in Hotel Rate Shopping: $
  4. 4. A Guide to choose Rate Shopper Tool rategain.com Below are Key Features and Capabilities that Revenue Managers need to evaluate while shortlisting a Rate Shopping Solution 03 1. Freshness of hotel rates How do you ensure that your pricing is relevant? To ensure correct pricing changes, it is extremely critical that rates shopped are recent and also highly relevant. 2. Rate Details Hotels tend to have multiple rates with various amenities so that they can carry out apple-to-apple comparison of their rates and all other add on features. A rate shopper needs to give rate details for all the rates shopped.  3. Integration with RMS As a Revenue Manager, you do refer to the revenue management system or the RMS, which uses competition rates to benchmark and make rate suggestions. Without a seamless integration between RMS and Rate Shopper tools, hotels won’t have this information. 4. Ability to shop on Metasearch Meta search sites are trying to grab the top space in the industry today. Competitor price listings from these sites need to be crucial to your hotel’s pricing strategy, so a rate shopper which can’t shop from these will be counter productive. 5. Ability to pull rates from GDS GDS is the second cheapest option for a hotel to get room nights, after the brand website. Most hotels sell non-negotiated rates on GDSs too; so without a rate shop from GDS, making a pricing plan for an on-negotiated GDS rate will be difficult. Besides, it is crucial to ensure that GDS data is fresh as well.
  5. 5. A Guide to choose Rate Shopper Tool rategain.com 6. Capability to shop from Mobile Apps and Mobile Websites New age channels also include Mobile options and with an increase in bookings made on the go, hotels are making offers exclusive to mobile users. Hence, a pricing strategy for mobile needs to have competitor rates from mobile. 7. Vacation Rentals – The New age channel shop Channels like Airbnb or Rooms Tonight have created a new market, to satisfy a niche group of customers. The impact of these websites is huge. Therefore, hotels need to track short- term lodging including vacation rentals, apartment rentals, homestays, hostel beds, or hotel rooms on such sites. So a good question to ask the vendor your evaluating is “Does your tool shops from Airbnb or Rooms Tonight?” 8. Shop brand sites Many tools do not shop from brand sites from competitors, this is a disadvantage because we have observed that hotels have nearly 5:1 ratio in terms of rates that they offer on their brand site vs. leading OTA sites. If your rate shopper is not shopping on competitor brand sites, then you are losing out.   9. Shop different rate types and identify them Hotel rates have 2 types of conditions: 1. Cancellation specific scenario where hotels restrict buyers from cancelling to avail a special rate. 2. Booking condition, where a specific discount is offered to meet a specific condition which is met. It would not be possible for a hotel to make a relevant comparison if their shopper is not able to shop these rates and is not highlighting them in a report either. 04
  6. 6. A Guide to choose Rate Shopper Tool rategain.com 10. Make a correct rate comparison by rate mapping While we discuss different rate types in a hotel, there are variations in rates based on their inclusions, policies as well as different room types have these rates. Thus, while a rate shopper can shop for various rate/room combinations, mapping them with keywords is crucial to ensure an apple-to-apple comparison. 11. On the go access Just like the increase in on-the-go bookings, being a hotel Revenue Manager, you too need mobile-optimize your rate shopper to tap on crucial alerts and reports. Only then you can make quick judgements and calls pertaining to pricing, and eventually stay ahead of the curve. 12. On Demand rate shop While hotels have their scheduled reports ready, which give information about rates from the entire distribution landscape, there will be situations where a change in hotel dynamics owing to a sudden pickup/wash in a city event will arise. Hotel rate shopper must consider it to gauge its impact and accordingly pave way for on-Demand shops, for greater emphasis. 13. Shopping for multiple LOS A hotel guest has multiple days in their stay. Keeping that in mind, hotels should offer rates based of their LOS. Similarly, their competitors need to make relevant rates and offerings, so that they can ensure that relevant propositions are made and one also gets to know what their competitor is offering and what the rate shopper shows in the rate shopping report. 05
  7. 7. A Guide to choose Rate Shopper Tool rategain.com 14. Capacity to distinguish tax inclusive rates from tax exclusive rates OTAs operate in different models. While some present rates inclusive of tax to customers, there are others that keep the ‘tax’ component completely out of price. Thus to get the correct idea about market offerings, a hotel rate shopper should be able to separate the tax component from inclusive price and then present it in a report along with tax exclusive price.   15. Product mapping on any key word Hotel Revenue Manager should correctly map components for an apple-to-apple comparison in terms of Room/Rate combination. Another aspect that a Hotel Revenue Manager should do is map key words such as Wi-Fi or Airport Transfer, so as to map similar rates which they need to offer. 16. Regional channels  Some regional OTAs have a massive impact on a particular region’s OTA contribution. This includes Ctrip in China or Rakuten in Japan. Having a rate shopper that does not shop from such OTAs and these regions, which happen to be source markets for the hotel, means the hotel is currently staying in the dark and the hotel will be unable to draw a comprehensive pricing strategy. 17. Rate Movement  While hotels tend to look at their occupancy PACE using RMS/manual methods, they do this exercise for their BAR. By doing it, they miss out on a critical trend which is how their and the competitor’s pricing strategy is moving. By doing this analysis, they gauge their competitor’s pricing strategy. A rate shopper should be able to do that for the hotel. 06
  8. 8. A Guide to choose Rate Shopper Tool rategain.com 18. Know age of data Freshness of data is extremely critical for a hotel’s pricing decision. When a hotel Revenue Manager makes his pricing decisions and refers to a report, it should properly mention when the rate was shopped. It should also outline the age of this data so that no errors are made owing to ambiguity of data age. 19. Enterprise capability While a rate shopper is an extremely important tool for a hotel, it is equally relevant for a regional Revenue Manager or a cluster Revenue Manager. The tool gives them the ability to shop and get data from multiple hotels in a click. 20. Rate Parity Is your Parity in check? Your tool should be smart enough to do rates and availability check for you. 21. Ability to shop multiple domains of the same site, based on source market Another key ability of a potent rate shopper is that it should provide rates from multiple domains of the same brand site. This will give you correct and relevant comparison from the source market.   22. Keep an Eye on Local Demand Are you prepared to tap the upcoming business opportunities? To capitalize on the future events and holidays, specify impact on your business your tool must be intelligent enough to notify and report all the events & holidays where the rate adjustments are most likely to improve your RevPAR. 23. Identify Online Hotel Competitors OTA listings have become imperative revenue channel for Hotels, consequently your OTA rank is a key metrics that influence your booking from a given OTA. A Hotel competitor tool that can track your OTA rank along with hotels that are above and below you is great information to identify new Compset hotels who otherwise would remain unknown. 24. Global Support You need a rate pricing tool which renders 24/7 global support. Rate Shopping Tool has to be a comprehensive Rate Intelligence solution. It should cater to multiple purposes. In order to correctly select a Rate Shopping Solution, you have to adopt an effective and intelligent rate strategy. 07
  9. 9. A Guide to choose Rate Shopper Tool rategain.com In order to leverage high-quality business intelligence data, you have to redefine your rate strategy .It’s no more about the RateShopping but many components of Rate shopper that make a complete, competitive intelligence tool. Such a system captures hundreds of thousands of hotels worth of data to engender rate and availability alerts in a few clicks. It delivers granular analysis to eventually help you monitor massive fluctuations in your market on time, as well as act immediately. Online Competiveness 101 for Hotels 08 Conclusion
  10. 10. A Guide to choose Rate Shopper Tool rategain.com Bangkok, Thailand Barcelona, Spain Jakarta, Indonesia London, UK Virginia, USA Durban, South Africa Kuala Lumpur, Malaysia Delhi NCR, India Brazil Columbia Cape Town JapanChicago, USA More about RateGain Founded in 2004, RateGain is a leading provider of cloud-based products and services around the function of hotel Rate Intelligence, Price Optimization, Seamless Electronic Distribution and Brand Engagement to the world’s leading Hotels and Online Travel Agents. With continued innovation and excellence in customer focus, we are proud to serve over 12,000 clients and numerous industry partners. Our customers are global and so are we, with offices in 10 countries across all major continents, supported by over 500 passionate professionals and seasoned industry experts. Through world-class solutions, RateGain helps its industry leading customers beat their competition and make more revenue every day. If you are looking for a latest solution for your channel management & online room distribution needs, we invite you to: Request a Demo Share It with: 09
  11. 11. A Guide to choose Rate Shopper Tool rategain.com Single Technology Platform to Manage Revenue, Reputation & Distribution Competitor Rate Shopper 1 Online Reputation Manager Revenue Optimizer Distribution Channel Manager Guest Feedback Survey Integrated Analytics 2 3 45 6 ManageYour Revenue Management Needs From One Single Dashboard Learn More www.rategain.com | marketing@rategain.com | US: 866.318.4358 | UK: 0808.234.4540 |AUS: 1800.502.529 Copyright © 2017 RateGain LLC 10

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