Current State of the Market
As many countries begin to slowly reopen their borders to the rest of the world, the hospitality and travel sector is starting to see the first signs of recovery. Our aggregated client data shows that the second week of March was when on the books (OTB) figures hit rock bottom. However, net revenues have been on the rise ever since, breaking into the positive in late May. And we expect the upward net revenue trend to remain true into Q3.
Reopening your property is not going to be easy, especially if you are running an independent operation. From updated industry guidelines and standards on hygiene and safety, to financial and operations planning in these unprecedented market conditions, it can easily get overwhelming. The good news is that you don’t have to tackle all of this on your own.
In This Together
The hotel tech community has come together to help hoteliers reopen and be more agile than ever with a future-proof tech stack that won’t break the bank. In fact, if you are currently drafting your path to recovery, now may be the best time to explore your technology options.
Here are a few solutions to consider, some of which are currently running limited-time offers in support of recovering businesses. Our cloud-native partners in property management systems such as Mews, Apaleo, RMS Cloud and Clock can help you to transform the guest experience and optimise your current front and back-office processes to reduce the new-found health risks.
One of the key lessons of previous market downturns is that slashing your prices will not solve the problem of low pick up. Instead, you could focus on creating an experience specific to your property and location. If you are not sure where to start, speak with solutions like Oaky, who can help you to build creative value-added packages to meet the unique requirements of each guest.
When it comes to forecasting and revenue optimisation, we believe that the future lies with continuous pricing and automation. In the current situation, both are more relevant than ever. Here is why.
The market is not what it used to be. The lack of demand over the past few months was not driven by the customer’s decreased willingness to pay, but rather by the various government rules, travel restrictions and fear. Revenue experts have widely agreed that as soon as clients reach a level of confidence in the new safety standards and travel restrictions are lifted, demand will come back. We are already seeing that in most cases this is true for the period from the end of Q3 onwards.
Undoubtedly, 2020’s market conditions are unprecedented. With more and more countries easing restrictions, the changes in pick up in the coming weeks and months will be rapid and any historical maps which you would normally follow will be of little help. Therefore, you need a revenue management solution which will recognise Covid-19’s impact on your OTB numbers, and will be able to adapt to shifting demand and adjust your prices in real-time to maximise your coveted high-season revenues. Without heavily leaning on somewhat irrelevant data from the summer of 2019.
To take this a step further, consider the benefits of automating the pricing process. Instead of spending countless hours trying to make sense of LY data in the current market context and guessing at the optimal price, why not switch to an RMS which can automatically adjust your prices 365 days ahead, in real time? Now imagine there is a solution that can also automate your reporting with smart analytics, so you no longer need to spend your mornings updating charts in Excel.
And finally, the key function of every RMS is to maximise revenues. Therefore, the expected ROI should be the top factor to consider when shortlisting your favourites. We have discussed performance before, and can confidently say that more often than not, the difference in added revenue between different solutions is higher than 5%. Across more than 500 hotels and 45 different markets, we have demonstrated a revenue increase between 5%-10% for our clients.
At Pace, we are doing as much as we can to help the industry recover! Get in touch to find out more about the different areas where we can help.