The Changing Role and Future of Revenue Management in the Hotel Industry
In the hotel industry, the process of revenue management is still relatively young. From its beginning, there has been an exponential growth in the last decade. Those who are the revenue managers have always worked behind the scenes and reported the other departments. In the present years, hotel revenue management is coming to the forefront in the business strategies of many hotels. This trend is going to increase further. Let us discuss the effects of its changing role on the hotel industry and what may happen in the near future.
Revenue Management is Levelling Up
The analytical insight and strategic knowhow coming from revenue management supports key business decision making. The revenue managers are now becoming part of executive committees. Their status is now equal to the heads of the marketing and sales departments. Many hotels now have the post of director of revenue management instead of revenue manager.
The Role will Continue to Expand
There is a constant change in the department of revenue management. This is because its technology base will continue to evolve and ways to become more competitive will be searched by revenue managers. They now make inventive marketing strategies through which business is generated by hotels. They are utilizing ecommerce, social media, client engagement and relationship management to drive the business.
Total Hotel Revenue Management will be Unleashed
There will be an expansion of total hotel revenue management from focus on room rate revenue to all other hotel revenue generators. These include revenue from various facilities in a hotel. Many revenue managers think this concept is on the verge of breakthrough.
Profit Management will take Centre Stage
The revenue managers in hotels are strategically positioned to help make more profit. The function is presently seen as profit generation rather than revenue management. To increase profit margins rather than increasing revenue is now becoming the main focus of the revenue managers.
Revenue Managers will focus on Guest Analytics
The hotel sector is not the same as before. It has become more competitive. They have to now compete with their international counterparts. The industry has become more competitive due to online travel agencies, the rise of hostels and high guest demands. So revenue managers are making guest analytics with the help of new technology which is producing unique and valuable insights.