Hotel Revenue Managers have transformed the profession in the last 15 years and I particularly like this article when it says that the Revenue Managers “are self-dividing into two distinct categories: those that are well prepared (or preparing) for 2024 and those that are well prepared for 2004.”
In the few years before 2008, we have seen a massive increment in revenue and profits in tourism, it was the time when OTAs have found a fertile ground for a splendid growth. The demand increased exponentially and the hotels were not prepared for such a blast and so with a good look and study towards the fellow airline companies, the revenue manager profession started to develop inside the hospitality walls.
Ten years down the line and the growth has consistently slowed down and sees today a little increase year on year, the offer caught up and overtook the demand. It is in this environment that a real Revenue Manager demonstrates how to maintain and drive more profits.
Here the 8 principles that make the Revenue Manager in a winning position ready to fight:
1. From Rooms to Relationships. The Revenue Manager is no longer focused on Rooms, but on the overall revenue that the guests are willing to bring to the property.
2. From Myth to Math. Analysis is where all starts, examine the data, the figures and anything that bring potential revenue is fundamental to build a stronger strategy.
3. From Silos to Systems. All figures among departments must be combined and analysed together to make sure to reach the overall target. It is not a civil war! The Revenue Manager should be responsible to work with all information at hand.
4. From Organized to Optimized. For the first few years Revenue Managers were drowning in new technologies, which did not talk to each other, but now the optimisation helps to improve the day to day task.
5. From Discounts to Drivers. It is important to see the difference that the value has achieved in the last few years. It is not the discount that drive more revenue, it is showing how valuable the product has become.
6. From Planning to Predicting. The Revenue Manager is not the extension of the financial team, they create one budget with a very mathematical calculation, the Revenue Manager works through a variety of possibilities based on a series of analysis and is flexible to the market evolution.
7. From Data to Decisions. Management used to receive pages and pages of reports with all the little details, nowadays the Revenue Manager prefers to engage the time to make decisions rather than type figures that nobody reads. Basic data are reported to show the improvements.
8. From Business to Better. To avoid to have a stagnant business, the Revenue Manager does not wait to see what happens, he/she makes it happens, being flexible with new strategy, approaches until the profits increases.