28 Jan Rate Strategies: Webinar Takeaways
Increasing your hotel’s revenue doesn’t have to be complicated.
Did you miss the webinar? Here are some key takeaways on the different rate strategies you can apply to your offering, from rate types to distribution:
It’s all about getting the right guest at the right time for the price. And doing so is not as complicated as you may think.
First off, it is always good to remind ourselves of the basics. Simply put, a good rate strategy is finding the right combination of rate plans and pricing techniques that is right for you. Remember – not all hotels are the same, what works for one may not work for another!
There are numerous rate types at your disposal such as; Rack, BAR, corporate, group, reward and package rates so make sure you use them to your advantage to ensure you reach all your target markets, but take care not to confuse them.
Remember – be sure to chose the right rate plans for the right channels to ensure you reach the right Guests!
When it comes to pricing, the Big Chains and Hard Brands invest huge amounts of time and man hours in creating and testing complicated pricing strategies to maximise revenue, but they can afford it, right?
But for those of you without teams of Revenue Managers and Market Analysts, here are 4 effective pricing techniques you can use and combine to build a strategy for your hotel:
- Competitive Pricing: Identify who your top competitors are and price your rooms accordingly – position yourselves right to take a bigger piece of the action!
- Middle Market Pricing: Price your high-end rooms around the same rates as your competitors basic rooms to grab the attention of travellers who are looking for something with an added value – give’em more to get them through the door!
- Value-added Pricing: Set your room rates higher than your local competition and offer more extras in the basic package – added extras are great influencers!
- Discount Pricing: The ideal option for low season or slow periods but not just for Room Only rates, apply this technique to your best offerings- a good way to maximise occupancy all year round!
These 4 techniques can be used together throughout the course of a year, targeting specific periods.
Distribution, rate parity and the OTAs
The current distribution landscape has more channels offering hotel rooms than ever before. Therefore, you need to understand which are channels are right for you.
Additionally, rate parity is something that has affected the way we look at pricing, creating the believe that you can only offer your cheapest rooms in the OTAs. But how does it actually work? What can you learn from the OTAs to generate more revenue?
- The right channels for the right rates: make sure you pick the right channels for your property and that compliment your rate strategy
- Wide rate parity: wide rate parity is the more restrictive form of parity agreement – in such clauses, a hotel agrees not to undercut the room prices that the OTA charges for their hotel
- Narrow rate parity: such clauses generally allow hotels to offer lower rates to other OTAs
- Use the OTAs to your advantage: with the high volume of visitors that they attract, the OTAs are an integral marketing platform. Make sure the content they display is a good reflection of your property
- Try a different approach: drive more direct business by offering non-refundable rates on the OTAs and flexible rates on your website
Effective examples of profitable rate plans
Example 1: Room Only: Book Directly On Our Site for the Best Available Rate
Example 2: Bed and Breakfast: Save €5.00 When You Book Your Stay with Breakfast Online
Example 3: One Night Escape: Dinner, Bed and Breakfast – Enjoy a Welcome Drink on Us
Example 4: Advance Purchase: Pay Now and Save 10%
Watch the webinar replay to find out more about these rate plans.