Chapter 5 focuses on systemwide reservations, outlining their importance for both travelers and lodging establishments. It covers various reservation systems, forecasting, overbooking management, and the role of the internet and social media in acquiring reservations. The chapter also discusses different sources of reservations and the operational processes involved in managing guest reservations effectively.

1. Chapter 5:
Systemwide Reservations
1

2. Focus Points
Importance of guest reservations to
travelers and lodging establishments
Overview of reservation system
Sources of reservations
Forecasting reservations
Overbooking (occupancy
management)
Processing guest reservations
2

3. Classroom Presentations
Introduction
Reservations are a necessity for travelers
Reservations are a necessary marketing
tool for hotels to produce a profit
• Steady flow of guests to a property – 30%
with a central reservation system
• Facebook, Twitter, corporate blogs, LinkedIn
3

4. Overview of reservation system
Choice Hotels International
5900 franchises
30 countries; 479,000 rooms
4

5. Overview of reservation system (cont’d.)
Brand names
http://www.choicehotels.com/ires/en-us/html/CorpBrandInformation?sid=rRPg.2c9UnKBu3.1
• Comfort Inn Cambria Suites
• Comfort Suites Suburban Extended Stay Hotel
• Quality Ascend Collection
• Clarion
• Sleep Inn
• Econo Lodge
• Main Stay Suites
• Rodeway Inn
5

6. Overview of reservation system (cont’d.)
InterContinental Hotels Group
3500 hotels and resorts
100 countries
535,000 guest rooms
Hilton
3,000 hotels
500,000 rooms in 74 countries and territories
Use a work-at-home program for its call center staff
• increase its quality of customer service
• decreasing call center costs
6

7. Overview of reservation system (cont’d.) Intercontinential Brands
http://www.sixcontinentshotels.com/h/d/6c/c/2/dec/6c/1/en/ob.html
• InterContinental Hotels & Resorts
• Crowne Plaza Hotels & Resorts
• Hotel Indigo
• Holiday Inn Hotels and Resorts
• Holiday Inn Express
• Staybridge Suites
• Candlewood Suites
• Park Inn Hotels
• Park Plaza Hotels & Resorts
• Regent International Hotels
• Experiences over 7 million visits to its web site each month.
• Marriott International
• 3,200 lodging properties in the United States and 66 other countries and
territories
• Uses TravelCLICK Hotelligence® in 150 of its select service and
extended stay properties including Courtyard, Residence
Inn, Fairfield Inn,TownePlace Suites, and SpringHill Suites
• “Hotelligence not only helps our hotels make the right
decisions, it also helps them make decisions more quickly—so
they take advantage of opportunities before their competition."
7

8. Overview of reservation system (cont’d.)
Carlson Hospitality Worldwide
Curtis-C (pronounced courtesy)
reservation system
• 730 hotel locations and six cruise ships
• 8,900 reservations per day processed; over 3
million per year (2000)
8

9. Overview of reservation system (cont’d.)
Carlson Brands
http://www.carlson.com
Regent International Hotels
Radisson Hotels & Resorts
Park Plaza Hotels & Resorts
Country Inns & Suites by Carlson
Park Inn Hotels
Radison Seven Seas Cruises
9

10. Overview of reservation system (cont’d.)
Carlson - Connected to 455,000 travel agents
Carlson - Data Interface
HARMONY – the PMS of the hotels
Customer KARE system (Customer Knowledge and
Relationship Enabling System)
Harmony Database Manager – room inventory and room
reservations
Guest Communication Manager – manages guest
satisfaction information
KnowledgeNet – provides access to company policies, forms,
reports, hotel procedures and newsletters
10

11. Global Distribution System
Global Distribution Systems (GDS) are distributors of hotel
rooms to corporations such as travel agents that buy rooms in
large volume. (115 million room nights = $20 billion in 2008)
1. Amadeus
2. Galileo
3. SABRE
4. Worldspan
TravelCLICK, the source of hotel industry electronic distribution
for many GDSs
Promotional advertising and methodology for measuring advertising reach
to a travel agent audience that yielded over $8 billion in hotel bookings in
2008
Insertion of Best Available Rate (BAR) for check-in date
11

12. Role of the Internet in Securing Reservations
Intro – A buyers’ market place with the
best rates on the Internet
Social Media - Facebook, Linkedin, Twitter
networking is going to be the second-most popular
online activity by 2012, overtaking shopping and
surpassing both communication—such as email—
and entertainment
12

13. Role of the Internet cont’d.
Background on Room Rates offered via the
Internet
Dot.com mania hits consumers ->wholesalers decided to
advertise free offers to entice consumers to use the Internet
Leaves lasting impression on purchasing manner
Wholesaler offers to take empty hotel rooms into inventory
and offer on Internet -> hoteliers grateful to sell rooms at low
sale prices
Internet sales light; everything seems ok
Other Internet sites offered similar models with their
discounts guaranteed lowest price -> transparency of rates
(guest can check room rates before check-in to see if their
rate has been offered lower on the Internet)
13

14. Role of the Internet cont’d.
Effect of Internet on Pricing Rooms – Muqbil 2003
35% of Americans used Internet to research travel
Real-time rate information availability causes re-book
booking, if lower rates are posted
Minus $1.27 billion to lower ADR because of increased
transparency and price competition and increased revenues
due to increased bookings stimulated by the lower rate
Internet average rate is 17% less than non Internet rate
75 % were discount seekers and 25% were convenience
bookers.
Price transparency during low periods is a negative for
hotels to increase rate; opposite during peak seasons.
14

15. Role of the Internet cont’d.
- Customer Relationship Management (CRM),
management of guest services with technology.
It allows travel companies (travel
suppliers and online travel agencies –
OTAs) to engage customers in strong,
personalized and mutually beneficial
interactive relationships, increase
conversions and sell more efficiently.
15

16. Role of the Internet cont’d.
Consumers Response to Use of the Internet –
Third-Party Websites (Expedia, Travelocity) serves
14,000 customers in more than 140 countries around
the world
GDS and Pegasus Hotel e-Commerce room night sales =
57,131,438 (46,510,434 sold by travel agents and
10,621,004 by consumer off the Internet) second quarter
2004
Over 65% of online hotel bookings will come from the direct
online channel i.e. via the hotel’s own website (76% for the
major hotel brands). The hotel website has become the first,
main, only and in many cases last point of contact with past,
current and potential guests. 16

17. Internet Effect on Pricing
Lookers into Bookers
Customize the online shopping experience. Guest Connect
templates guide the flow of the booking process and enable
the hotelier to incorporate the specific product elements that
will best merchandise their property or chain from expanded
property descriptions and rich images to dynamic packaging,
promotional pricing (with “slash-through” pricing), room
preference selection, upgrades or links to a virtual concierge
for additional services.
17

18. Social Media
Set goal
communicate to, or communicate with your guests and prospective
guests?
seeking fleeting fans or are you out to build long-term, lasting
relationships with your customers?
enhance the credibility and reputation of your brand?
Promotion of the week?
CRM platform?
Commitment to Social Media Marketing (SMM
involves participation, interaction, resources, commitment, follow-through,
and time.
18

19. Social Media cont’d.
Social media should not be the
anchor to your marketing plan
Team effort
Seek out the experts and observe
19

20. Start - Types of reservation
systems
Franchisee – hotel owner who leases a brand
name and the benefits by:
Management expertise
Financial backing
National advertising
Group purchasing
Reservation service
20

21. Types of Reservation Systems
Referral Member of a Reservation Referral System - a
worldwide organization that processes requests for room
reservations at a particular member-hotel, is a hotel
developer/owner who has access to the national reservation
system
15%-30% of daily room rentals vs. independent status
Hilton franchise fees example (2009):
• Initial fee of $85,000 for first 275 guest rooms or suites
plus $300 for each additional room or suite (min. fee to $75,000)
• 5% monthly gross rooms revenue for royalty fee
• 4% of monthly gross rooms revenue = monthly program fee
• a monthly fee of 0.75 percent of hotel gross revenue is charged
for use of OnQ proprietary business software and hardware
system
• Plus other fees for participation in Frequent Traveler/Guest
Reward program, training, and computer system
21

22. Sources of Reservations
Corporate Clients
Secretaries Club
Toll-free
Reservation Referral Chain
Travel Agent
Web sites (Expedia, Travelocity,
Hotels.com)
LinkedIn
22

23. Sources of Reservations cont’d.
Social/Military/Educational/Religious/
Fraternal (SMERF)
Provides opportunity to fill vacancies in low
times
These markets are price sensitive and
time-relaxed and will travel accordingly.
23

24. Sources of Reservations cont’d.
Meetings/Incentive/Conference/Event
(MICE)
Need to locate large group of conference
attendees
Details: airfares, hotel rooms, room rates,
food and beverage, cultural activities, etc.
Cooperation of local tourism and travel
association necessary
24

25. Sources of Reservations (cont’d.)
Group travelers
Refer to various travel directories used by hotels and
potential guests as listed in the text
• Group planner
• Bus association network
– Virginia Bus Association
– Pennsylvania Bus Association
– National Bus Association
• Travel directories i.e. Hotel and Travel Index.com (refer to p.
139)
• Hotel Representative – member of hotel staff who seeks group
activity planners
• Hotel Broker – person who sells hotel room prize packages to
corporations, sweepstakes promoters, game shows, and other
sponsors (with a discount) 25

26. Sources of Reservations (cont’d.)
Leisure Traveler – people who travel alone or with
others to visit points of interest or relatives, or for other
personal reasons
• Travel agencies
• Toll-free numbers
• Reservation/referral systems
• Internet
• Social Media – Note Marriott’s effort on YouTube being
incorporated into the marketing efforts of this segment – "Tweet
Yourself to Hawaii" online campaign - best fan videos will be
posted for public judging,
Current Guests - an overlooked marketing
opportunity 26

27. Forecasting Reservations
Rooms forecast – refer to Figure 5-2 - (p. 141)
Helps to preview the Income Statement
house count – number of persons registered in a hotel
full house – 100% occupancy
Procedure to determine forecast – refer to Figure 5-3
(p. 142)
27

28. Overbooking (Occupancy Management)
Overbooking – accepting reservations for
more rooms that are available by
forecasting the number of no-show
reservations, stayovers, understays,
and walk-ins, with the goal of attaining
100% occupancy
28

29. Overbooking (Occupancy Management)
P. 138 Toh reports: “in many instances, overbooking
to overcome the problem of no-shows and late
cancellations may produce advantages by way of
operating efficiencies that far outweigh the occasional
inconveniences to guests and travelers.”
Gould et al. could find no direct statutory or
administrative law governing hotel overbooking with
the exception of one Florida regulation. Hoteliers and
front office managers who practice overbooking do so
to meet an organization’s financial objectives. They
do not intentionally overbook to cause problems for
the traveler.”
29

30. Overbooking (Occupancy Management)
Components of overbooking (need data)
Confirmed reservations – 4 pm or 6 pm check in
Guaranteed reservations – credit card required
Stayovers
Understays
Walk-in guests
Occupancy management formula as listed in
Chapter (p. 145) (components)
30

31. Overbooking (Occupancy Management)
Revenue Management
Restate the role of revenue management
in the reservation process (this topic will be
covered in detail in Chapter 6) –
“A management technique of planning to
achieve maximum room rates and most
profitable guests”
31

32. Processing Guest Reservations
Systemwide Reservation Systems
Operational procedure:
• Greeted by an operator
• Guest places of request for dates and
accommodations
• Operator checks availability of request with
room data bank
• Operator suggests alternatives
32

33. Processing Guest Reservations (cont’d.)
Outsourcing reservations (p. 148) – providers of central
reservation systems that are not owned by the hotel operation
Internet
Global Distribution System (GDS) – Amadeus, Galileo, SARE, and World
Span
Web-enabled Application-Service Provider (ASP)
Components of SynXis Agent (Allows hotel operators to consolidate
and control hotel inventory from all booking sources. )
• Central reservation system
• GDS connectivity
• Alternate-distribution system connectivity
• Book-A-Rez
33

34. Processing Guest Reservations
(cont’d.) w/ Outsourcing
Use Descriptions That Allure and Entice
Update Your Property Information
Keep Room Inventories Loaded And
Updated
Keep The Lines of Communication
Open
34

35. Processing Guest Reservations (cont’d.)
Outsourcing reservations cont’d.
Pegasus Solutions
• Real-time availability and pricing for
property and room types
• Interfaces with key industry PMS,
revenue systems, and loyalty program
systems to approximately 7500 hotels
35

36. Processing Guest Reservations (cont’d.)
Confirmed reservation – a reservation that is
held until 4pm or 6pm; discuss implications
on profit and loss statement – note: this
category has been generally discontinued in
most hotels.
Guaranteed reservation – a reservation that is
held with a credit card until the guest arrives;
discuss implications on profit and loss
statement
36

37. Processing Guest Reservations (cont’d.)
Reservation codes for confirmed or
guaranteed reservations (See example,
p. 149)
Components
• I.D. number of property
• Initials of reservationist
• Date of arrival
• Date of departure
• Type of credit card
• Room rate
• Type of room
• Sequential reservation number
37

38. Processing Guest Reservations (cont’d.)
Cancellation code (See example, p. 150)
Components
• I.D. number of property
• Initials of person who processed the reservation
• Date of arrival date of departure
• Sequential number of cancellation
Blocking procedure – removing rooms from the
available room data bank for the dates involved
– blocking on the horizon – in the distant future
– daily blocking assigning guests to their particular rooms on
a specific day of arrival
38

39. Processing Guest Reservations (cont’d.)
Process of completing reservations through a PMS
Figure 5-4 – Guest Data screen (p. 152)
Figure 5-5 – Room Inventory screen (p. 152)
Figure 5-6 – Guest Deposit screen (p. 153)
Figure 5-7 – Special Requests screen (p. 153)
Figure 5-8 – Blocking Report screen (p. 154)
Figure 5-9 – Arrival Report screen (p. 155)
Figure 5-10 – Departure screen (p. 156)
Figure 5-11 – VIP Information screen (p. 156)
Figure 5-12 – Projected Occupancy screen (p. 157)
Figure 5-13 – Travel Agent screen (p. 157)
Figure 5-14 – Guest Message screen (p. 158)
39

40. Processing Guest Reservations (cont’d.)
Database Interfaces
Transferring of computer information
(captured at the time a reservation is
made) between computers
• Examples
– Marketing and sales office
– Housekeeping staff
– Maintenance crews
– Food and beverage
– Controller’s office
40

41. Processing Guest Reservations (cont’d.)
Database interfaces (cont’d.)
True Integration
• Integration of central reservation system and
property management system sharing a
database.
• Benefits:
– Consumer can access real-time reservations
– Less investment for data storage
– Hotels can access data via Internet
41