How to Increase Hotel Occupancy Rate & Revenue During Low Season

IDeaS Revenue Solutions

4 Nov 201604:45

Summary

TLDRThis script discusses strategies for managing low occupancy dates in the hospitality industry. It emphasizes the importance of understanding demand and collaborating with sales and marketing to target the right segments with promotions. Key steps include identifying need periods, creating a marketing calendar, setting promotion targets, ensuring promotions are bookable across channels, and monitoring their effectiveness. The script advises adjusting or discontinuing unsuccessful promotions and analyzing their impact on revenue and occupancy to inform future strategies.

Takeaways

📈 Understand Low Occupancy: Recognize that management can't generate demand but can assist sales and marketing to target the right business at the right time.
📆 Demand Calendar: Create a marketing calendar to coordinate initiatives and ensure the entire organization is aligned on strategies for demand periods.
🎯 Target Segments: Identify which market segments are lagging and tailor promotions to their specific needs and preferences.
🔍 Historical Data: Utilize past data to determine which promotions were successful and apply those insights to future campaigns.
💡 Promotional Strategy: Develop promotions that cater to the desires of different client segments, such as corporate accounts or retail customers.
🎯 Set Targets: Establish clear targets for promotions to measure their success and ensure they contribute to revenue or occupancy goals.
💰 Revenue Analysis: Calculate the number of additional room nights needed to match the revenue of a discounted rate to assess the true impact of promotions.
🔗 Ensure Bookability: Verify that promotions are accessible and bookable through all intended channels, including OTAs and travel agencies.
📊 Monitor Promotion Pickup: Keep track of how well a promotion is being received and adjust or change strategies if it's not performing as expected.
📈 Post-Promotion Review: After a promotion, evaluate its performance against set targets and its impact on revenue or occupancy.
🔄 Learn and Adapt: Retain successful promotions for future use and avoid repeating unsuccessful ones to continually refine marketing strategies.

Q & A

What is the main focus of the transcript regarding low occupancy dates?
-The transcript focuses on demand generation, the role of management in supporting sales and marketing, and strategies to target the right business segments at the right time during low occupancy periods.
How can management assist in generating demand for low occupancy dates?
-Management can support by working with sales and marketing to identify need periods, understanding which segments are lagging, and leveraging past promotional successes to target the right business segments effectively.
What is the importance of having a demand or marketing calendar?
-A demand or marketing calendar helps the entire organization stay informed about ongoing and planned initiatives, ensuring alignment and coordination across different departments.
Why is it crucial to identify the right segment to target for promotions?
-Targeting the right segment ensures that the promotion is relevant and appealing to the potential customers, increasing the likelihood of a successful campaign and avoiding unnecessary discounts for less interested segments.
What should be considered when setting targets for a promotion?
-Targets should consider the additional room nights needed to achieve the same revenue level as before the promotion, taking into account the cost of the promotion and the potential impact on revenue.
How can a hotel ensure that a promotion is bookable through all channels?
-By testing all links, checking with OTAs, travel agencies, and the hotel's reservation staff to confirm that the promotion is visible, accessible, and correctly communicated.
What action should be taken if a promotion is not being picked up by customers?
-The hotel should reassess whether the promotion is suitable for the market, check its bookability across all channels, and consider modifying or discontinuing the promotion if it's not attracting the desired response.
How can a hotel measure the success of a promotion after it has ended?
-By comparing the performance metrics before and after the promotion, such as revenue, occupancy, and STR (Single Top Line) performance, to determine if the promotion met its targets and contributed positively to the hotel's performance.
What should a hotel do with promotions that have proven successful in the past?
-Successful promotions should be kept as options for future use, as they have a proven track record of increasing occupancy or revenue.
Why is it not advisable to repeat promotions that did not work previously?
-Repeating unsuccessful promotions may not yield better results and could lead to further revenue loss or missed opportunities for more effective marketing strategies.
How can a hotel determine if a promotion has increased its revenue or occupancy?
-By analyzing the forecast and actual performance data before and after the promotion to see if there was an increase in revenue or occupancy that can be attributed to the promotional efforts.

Outlines

00:00

📈 Managing Low Occupancy with Targeted Promotions

The paragraph discusses the challenges of managing low occupancy dates in the hospitality industry, emphasizing that while demand generation is not directly within a property's control, management can support sales and marketing efforts. It suggests using forecast data to identify periods of low demand and collaborate with sales and marketing to target specific business segments with past successful promotions. The importance of setting clear targets for promotions, considering the cost of the promotion versus the revenue generated, and ensuring the promotion is bookable through all channels is highlighted. The paragraph also stresses the need to monitor the effectiveness of promotions, adjust strategies based on uptake, and analyze the impact on revenue and occupancy post-promotion. Successful promotions should be kept for future use, while unsuccessful ones should be discarded or revised.

Mindmap

Keywords

💡Low Occupancy Dates

Low occupancy dates refer to periods when a hotel or similar establishment has a lower than expected number of guests or bookings. This concept is central to the video's theme as it discusses strategies to manage and increase demand during these times. For example, the script mentions that 'low occupancy dates are all about demand,' indicating that the focus should be on generating more interest and bookings during these periods.

💡Demand Generation

Demand generation is the process of stimulating interest in a product or service to increase sales. In the context of the video, it is about creating a desire for hotel bookings during low occupancy periods. The script emphasizes that while management cannot generate demand, they can support sales and marketing efforts to achieve this goal.

💡Sales and Marketing

Sales and marketing are two interconnected functions that aim to promote and sell products or services. The video discusses how these departments can collaborate to address low occupancy issues, using past data and forecasts to target specific segments and promotions effectively.

💡Forecast

A forecast in this context is a prediction of future demand for hotel rooms. The video script mentions using the forecast to identify when demand needs to be generated, which is crucial for planning marketing initiatives and promotions to fill rooms during low occupancy dates.

💡Need Periods

Need periods are times when there is a specific requirement to increase bookings due to low occupancy. The script suggests working with sales and marketing to target these periods with tailored promotions and strategies to boost demand.

💡Segments

Segments in the hotel industry refer to different groups of customers, such as corporate travelers, leisure travelers, or groups. The video emphasizes understanding which segments are lagging and tailoring promotions to their preferences to increase bookings.

💡Promotion

Promotion is a marketing strategy used to increase awareness and sales of a product or service. The script discusses the importance of creating targeted promotions for different client segments during need periods and setting measurable targets for their success.

💡Targets

Targets are specific, measurable goals set to evaluate the success of a marketing campaign or promotion. The video script highlights the importance of setting targets for promotions to determine whether they have been successful in increasing room nights or revenue.

💡Bookable

Bookable refers to the availability of a product or service for customers to reserve or purchase. The video script stresses the importance of ensuring that promotions are bookable through all channels to avoid customer frustration and to maximize the potential for increased bookings.

💡OTAs

OTAs, or Online Travel Agencies, are platforms that allow customers to book travel accommodations and services. The script mentions checking with OTAs to ensure that promotions appear correctly and are accessible to potential customers.

💡STR Performance

STR Performance refers to the performance of a hotel as measured by metrics such as occupancy rate, average daily rate, and revenue per available room. The video script suggests evaluating whether a promotion has positively impacted the hotel's STR performance during the period it was run.

💡Discount Rate

A discount rate is a reduced price offered to encourage bookings. The video script uses this term to illustrate the calculation of how many additional room nights need to be sold at a discounted rate to match the revenue of fewer rooms at a higher rate, taking into account the cost of the promotion.

Highlights

Low occupancy dates are linked to demand generation and revenue management.

Revenue management can support sales and marketing but cannot create demand.

Forecasting is crucial to identify when demand needs to be generated.

Collaboration with sales and marketing is key during periods of low demand.

Understanding past promotions' success is important for targeting business segments effectively.

A demand calendar or marketing calendar is essential for organizing initiatives.

Targeting the right segment with the appropriate promotion is vital for success.

Promotion strategies should be tailored to the needs and preferences of different client segments.

Setting targets for promotions is necessary to measure their success.

Calculating the revenue impact of promotional discounts is important for setting targets.

Ensuring a promotion is bookable through all channels is crucial for its success.

Monitoring the uptake of a promotion is essential to assess its effectiveness.

Adjusting or changing a promotion based on its uptake is a strategic approach.

Post-promotion analysis is necessary to evaluate its performance against targets.

Comparing forecast data before and after a promotion can indicate its impact on revenue or occupancy.

Assessing the overall impact of a promotion on STR performance is important.

Successful promotions should be kept for future use, while ineffective ones should be reconsidered.