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Defining success in revenue management By Patrick Mayock www.HotelNewsNow.com (604) 726-2337

The best revenue managers are those who can not only mine the most data but those who can present it in the clearest, simplest way to support agreed-upon organizational goals.

So concluded a panel of experts during a HSMAI University webinar Tuesday titled "How will you measure your success?" co-hosted by HotelNewsNow.com and its parent company, STR.

"When we look at measuring success, we are all very data-driven. We have to realize that not every person who looks at data looks at it in the same way," said Klaus Kohlmayr, senior director of consulting for IDeaS.

Whereas in the past hoteliers struggled to find adequate data, today the opposite problem exists: There is often too much data for anyone to know what to do with.

Revenue managers are not only tasked with collecting those measurements but parsing them down into easy-to-understand metrics everyone can understand, Kohlmayr said.

Failure to do so will result in analysis paralysis and missed windows of opportunity. "A sub-optimal decision in time is better than an optimal decision too late," he said, citing IDeaS president and founder Ravi Mehrotra.

Common goals
A key to translating data into success is coming to organization-wide agreement on key metrics and shared goals. Different departments tend to have different aims, so finding common ground will encourage alignment and focus throughout the operation, Kohlmayr said.

"What is important? What is key? What are the critical success factors that everyone can rally behind and believe in?" he said.

And not just success factors, but clearly defined, granular success factors, said Rao Avasarala, VP of enterprise solutions for TravelClick.

Instead of saying, "I want to increase (revenue per available room)," revenue managers should take a more focused approach: "I want to raise brand.com transient reservations by two points during August."

"Having clearly defined goals establishes a great starting point and helps us execute a closed loop process for performance improvement," Avasarala said.

Measurements should happen in real time, he said. While it's important to measure retrospectively, revenue managers must also know how their decisions immediately impact performance. Doing so allows for fine-tuning of strategies and adjustments of goals and actions along the way.

"It's a constant process," Avasarala said of the closed loop.




Digging deeper
Revenue managers can no longer focus simply on the numbers, panelists agreed. They must also focus on the reasoning behind those numbers.

"It's not really the 'what' but the 'why,'" Kohlmayr said.

While RevPAR Index, for example, is a commonly used benchmark to gauge performance in the hotel industry, revenue managers must understand the factors that affect its performance to better develop strategy or course correct, he said.

Often it takes five "why's" before the root cause is uncovered, Kohlmayr said. Revenue managers would also benefit from looking past the obvious metrics (e.g. RevPAR Index) to those that support a broader, more balanced scorecard, said Apo Demirtas, CEO and cofounder, R&D Intelligent Hospitality.

He suggested six such metrics:

• Price-to-Value Ratio (PVR)
• Price Confidence Index (PCI)
• Space-to-Occupancy Ratio (SOR)
• Room Revenue Multiplier (RRM)
• Negotiated Production Density (NPD)
• Price Position Index (PPI)

But again, Kohlmayr stressed simplicity above all else.

"It's all about simplicity. Revenue managers unfortunately try to overcomplicate things many times and end up with too much data oftentimes," he said.

"Patrick Mayock is the features editor at HotelNewsNow.com, an online news resource for the global hotel industry. He can be reached at patrick@hotelnewsnow.com.

This article originally appeared on HotelNewsNow.com. Its copyright holder has granted the HSMAI Greater Los Angeles Chapter a one-time, non-exclusive right for distribution in this newsletter. Further use, such as reproduction, distribution and display, is prohibited without the express written consent of its author."

Article Source - HotelNewsNow

SOCIAL MEDIA

Hotels Getting More Heads in Beds using Location Based Incentives by Jacquelynn Mendez www.e-marketingassociates.com (626) 444-9111

After presenting at a recent HSMAI LAX workshop, I found that despite hoteliers' past lag in social media adoption, they are now catching onto the latest online trends and checking into location based services. But after claiming their page, the next question became, "What kind of deal should my hotel offer?" This is where the fun comes in…

With hardly any precedent set in this field and a variety of open options available on these platforms, managers are given the opportunity and freedom to be as creative, catchy and clever as they want with location based incentives. Of course there are a number of factors to consider when developing specials, including budget, availability and time frame, but other than working around these guidelines, the possibilities are endless. So to get the creative juices flowing and the brainstorming session started, below is a list of ideas that have recently been used to grab the attention of potential guests, essentially getting more heads in beds (or at least in the building).

Late Check Out
Radisson Edwardian's London and Manchester hotels recently made headlines with their cleverly executed "Check In, Check Out Later" promotion. With this particular deal, Radisson Edwardian guests who check in on Facebook or Foursquare and show their phone at the front desk will qualify for late checkout of up to two hours later than a regular guest. A temporary promotion like this is a great way to test out location based services without a long term commitment, giving managers the opportunity to collect guest data and receive valuable feedback.

Free Parking
Since the days of Monopoly, people have always yearned to land on free parking and not much has changed since then. Although some hotels already offer this extra bonus with a room check-in, it is a wonderful perk for the properties that don't because depending on your location, it can be a low cost promotion that steers guests in your direction. Just be sure to stipulate that the free parking only comes with both a hotel and location based check-in.

Additional Loyalty Points
Loyalty card members are always trying to find new ways to add to their prized point total. This is why Starwood Hotels and Resorts recently partnered with Foursquare to offer members of the Starwood Preferred Guest (SPG) loyalty program additional points, badges and rewards for their check-ins at participating hotels. Although this promotion may not focus on bringing new guests in, it is an effective way to keep loyal members happy and coming in for more!

To Learn More
To learn more about how social media can help your hotel build awareness and expand its reach, contact E-Marketing Associates at (626) 444-9111.