The Rainmaker Group · 7 Aug
A hotel that is constantly jam-packed with guests is not automatically a profitable one. The goal of a successful hotel is not necessarily to achieve 100 percent occupancy, but rather to optimize revenue. And developing a way to more accurately forecast daily demand is a key operational challenge for hoteliers.1
The Rainmaker Group · 24 Jul
An analysis of the U. S. meetings and events market by PwC,1 revealed that the U.S. meetings industry generates approximately $30B - or just over one in five dollars - in hotel room revenue, while another $110B in revenue is generated from ancillary services such as food and beverage, event space, equipment rental, ground transportation, audiovisual (AV) support, and other services. Unfortunately, current revenue management practices tend to evaluate hotel group business performance based on the revenue per available room (RevPAR) index, which is not the best metric for determining a group's overall profitability. There are several factors contributing to this faulty approach.
The Rainmaker Group · 12 Jun
A hotel’s revenue optimization team and its digital marketing team my not always see eye to eye, writes Tammy Farley, President & Co-Founder of The Rainmaker Group. But they each play an indispensible – though complementary – role in successfully marketing the hotel. Here’s her analysis.
The Rainmaker Group · 30 May
"Perhaps the most critical component for success of the modern enterprise is its ability to take advantage of all available information both internal and external."This quote captures the essence behind an increasing emphasis on business intelligence (BI) among the world's top sectors. An emphasis that stems from the exponential growth of data now created and collected in organizations, with no signs of a slowdown. The International Data Corporation predicts that the collective sum of the world's data will reach 175ZB by 2025.2 Unfortunately, many hotel owners don't yet understand exactly what business intelligence is or why it's important for their business success.
The Rainmaker Group · 29 Apr
I recently read a piece about an international resort company that introduced a Revenue Management System (RMS) within the last five years. Like many resort properties around the world, their hotels have a high degree of dependence on contracted tour business and other leisure-oriented distribution channels. Because of the long lead-time associated with forming these contracts, "timing" is a very important focus of Revenue Management as missing a contract season means missing out on bookings that are essential to their performance.
The Rainmaker Group · 13 Feb
According to the 2019 AMEX Global Meetings & Events Forecast,1 the meetings industry is in a period of consistent growth, with small but meaningful increases projected in meeting sizes, length, and number of attendees. And although trend data2 supports that room night share, guest-paid RevPAR, and group ADR have been relatively flat, the group/meetings customer segment remains a strong and steady source of hotel business.
The Rainmaker Group · 30 Jan
Last year proved to be a strong one for the U.S. hotel industry, with occupancy, average daily rate (ADR), and revenue per available room (RevPAR) all trending positively. For 2019, STR and Tourism Economics1 optimistically project another year of growth. Changes in supply, however, will impact local market occupancy levels and hoteliers' pricing power, with many hotels experiencing more intense competition among key guest segments. To maintain profit margins, and stay ahead of the curve, consider your business in light of these top seven hospitality trends.
The Rainmaker Group · 18 Dec
As traveler behavior and hotel technology undergo momentous transformations, the hotel distribution landscape is transforming right along with them. Your hotel distribution strategy plays an important role in your business, and understanding your true demand in light of dynamic distribution developments has become more crucial to your profits than ever before.
The Rainmaker Group · 27 Nov
Group business is growing. According to American Express,1 group hotel rates increased globally 2.8 percent on average over 2017, with North America seeing the greatest increase, rising 3.5 percent. And we can expect those rates to continue their upward climb along with continued demand growth from groups.2 Unfortunately, many hotels are not capturing the full potential of this growth the average U.S. hotel occupancy rate hitting a 30-year high3 at 66.1 percent, while event space remained vacant a disproportionate amount of the time.
The Rainmaker Group · 17 Oct
Travel customers have an unprecedented number of options to shop and book hotels, with new competitors constantly jumping into the distribution channel pool. Determining what inventory to sell through which channels has become a critical component in operating a profitable hotel. The industry is seeing online travel agencies (OTAs) with market values higher than many hotel brands and commissions rising at twice the rate of revenue growth.1 Despite these intimidating numbers, intermediary distribution channels should not be looked upon with enmity, but rather as key players in your unique channel mix strategy - designed to bring you greater success and profitability in 2019.
The Rainmaker Group · 9 Oct
As summer's warm breezes and lush, green growth transform into the vibrant colors and crisp air of the fall season, another familiar season arrives in its wake: the often dreaded but always necessary Hotel Budget Season.
The Rainmaker Group · 11 Sep
Once upon a time, group business was essentially a filler for the guest rooms that transient business didn't occupy. In today's world of all-time occupancy highs,1 group business tells a different tale. When hotel owners examine their full profit picture, many now understand that group business and the revenue it generates is a major player in their overall revenue management (RM) strategy. However, groups are a challenge to revenue manage, as they're made up of many moving parts. To be successful in the group arena, hotels need to have the appropriate tools and strategies in place, as well as a thorough understanding of group value. And that often begins with analyzing the right metrics.
The Rainmaker Group · 13 Aug
When people think of all-inclusive resorts, they may conjure up images tied to bland buffet food, endless banana daiquiris, and conga lines of partying singles dancing around the poolside - all for one budget-conscious package price. Today's all-inclusives still tempt travelers with comprehensive packages that include meals, lodging, and entertainment options. But the all-inclusive business model has evolved significantly from its 1950s origins.1
The Rainmaker Group · 17 Jul
The evolution of all-inclusive resorts reads a lot like the fairytale of Cinderella. From humble beginnings catering to a dollar-stretcher crowd - with mediocre buffet food, mid-level accommodations, and events centered around boisterous pool activities - to today's transformation into a bright, rising star in the hotel industry. From 2011 to 2014, demand for all-inclusives rose from 8 to 14 percent,1 and now they are one of the fastest growing segments in vacation lodging. Hundreds of all-inclusive resorts now span the globe, moving beyond beachside havens to include ski resorts, wellness retreats, and exotic cultural destinations. Fueled by improving economic conditions and shifting guest expectations, all-inclusives now offer posh accommodations, diverse cuisine, and an ever-expanding array of amenities and services for guests of all ages and preferences.
The Rainmaker Group · 29 May
Over the past decade, the hotel industry has experienced dramatic changes, particularly in the area of hotel channel distribution. Big brands, online travel agencies (OTAs), global distribution systems (GDS's), and metasearch websites are all vying for customer attention, and it's all affecting hotel margins.
The Rainmaker Group · 8 May
"Science is a way of thinking much more than it is a body of knowledge."~ Carl Sagan
The Rainmaker Group · 17 Apr
In 1972, an employee of British Overseas Airways Corporation by the name of Ken Littlewood provided the genesis of what has become today's revenue management (RM) discipline. He established "Littlewood's Rule," a yield management rule that addressed revenue maximization by proposing that discounted fares be accepted if their revenue value exceeded anticipated revenue from the expected value of full-fare tickets. Littlewood's algorithm led to experimentation with "fenced" pricing and a forecasting system based on seat inventory. Airlines also tried to fill as many seats as possible by predicting how many booked passengers would not show up for their flight, and then overbooking by the predicted amount to ensure every seat was filled.1
The Rainmaker Group · 25 Sep
In the highly competitive hospitality industry, it is critical to assemble as much information as possible to make educated decisions: enter revenue management. Using the basic principles of supply and demand economics, hoteliers can optimize revenue by strategically managing a property's room inventory, pricing and distribution. Based on market trends and forecasts about consumer demand, revenue managers are able to maximize revenue during high-demand periods and stimulate demand during periods of lower activity. Put simply, hotel revenue management is selling the right room to the right customer at the right moment at the right price through the right channel.