In the weeks following Rainmaker’s 5th annual OPTIMIZE user conference at the stunning Terranea Resort in Southern California, we have continued to reflect on the compelling content presented during that fast-paced three-day event.
With thought provoking and informative sessions addressing such key industry topics as the convergence of revenue management and marketing, industry disruption, the evolution of the hotel landscape and much more, we uncovered several trends that are on top of everyone’s mind this year.
Below are the top five conference takeaways for the gaming and hospitality industry.
1. Revenue management and marketing are converging
We know that revenue management is all about maximizing, well, revenue, and in the past, this has primarily been accomplished through manipulating room pricing to create demand. The times, they are a-changing though, and there are more cards to play here.
When these two departments come together, sharing data to first optimize demand, property operators swiftly identify issues, aside from pricing, that may be causing lags in performance. Data, and the ability to adequately interpret data, are key drivers behind an operator’s ability to find opportunities to change tactics and improve future demand.
As was highlighted during OPTIMIZE, hoteliers can improve demand, so they no longer need to rely on discounting to increase occupancy and drive revenue. The need for collaboration between revenue management and marketing comes as the organizational lines between the two blur in the ongoing attempt to win over the customer, with increased direct bookings as the prize.
2. Group revenue optimization is the key to profitability
During day two of OPTIMIZE we officially unveiled our group forecasting enhancement for both our grouprev® & guestrev® solutions. Presented by Rainmaker’s Dan Skodol and Uttiya Dasgupta, this was an exciting session for our gaming and hospitality attendees, as group forecasting is a crucial next step in understanding total group revenue management and maximizing revenues from the ever-growing group business sector.
For many properties, forecasting and pricing decisions, traditionally, have been based on data solely from transient business, without factoring in group business data. The risk in this process for hotels and casinos is that they may be consistently underpricing both the transient and group business coming through their doors on future dates that may have considerable group demand. Increasing analytical efforts behind group revenue management paves the way for properties to ultimately win a much larger piece of the group business pie.
3. The hotel landscape is evolving
Industry consolidation, the ongoing love-hate relationship between the OTA’s and the big brands, and the continued growth of alternative accommodations, such as Airbnb, all have properties in every market sector scrambling to ensure that they’re gaining their fair share of revenue from their most profitable channels.
Many have looked at the emergence of these varying industry disruptors and declared war.
Our OPTIMIZE sessions focused more on the why, when and how of a property’s marketing strategy in achieving more direct bookings, as well as ways to identify opportunities to work synergistically or symbiotically with the OTAs to level the playing field against alternative accommodations and other market disruptors.
As this industry continues to evolve rapidly, it is now a necessity for operators to evolve along with it, rather than fighting the change.
4. RM isn't just for the big brands anymore
Since revenue management has traditionally been the domain of the big brands and big resort properties with big budgets to match, Rainmaker has made it our business to bring big data science tools to the mid-market, with a modular suite of solutions to meet the specific needs of any size property.
With the introduction of revcaster® rate shopping tools to the Rainmaker portfolio, we’ve done just that.
During the conference, Rainmaker’s Erik Browning dove into the pricing strategies that transcend property size and brand, helping hoteliers learn how to price based on both real and perceived value of the hotel as seen through the lens of the traveling consumer.
By applying these strategies, revenue managers can more effectively compete in any market condition by understanding their true value proposition.
5. It isn’t all about RevPAR anymore
It’s clear that, in the continually evolving hotel landscape, revenue managers must work with every asset a property has in order to effectively compete – and rooms are only a piece of that pie.
Gaming properties have long known that increasing “share of wallet” is the primary goal, which means keeping guests on property to maximize their ancillary spend at all property amenities, including restaurants, spas, retail outlets etc. This concept is now permeating the traditional hotel market, as properties begin to focus more of total profit optimization, not just increasing room revenue.
By drilling down data to a granular level and analyzing guest behavior, hotels can learn not only which guest segments are the most profitable, but which individual guests are likely to spend more on-site and where. In this way, they can tailor their marketing and promotions to attract the right guests at the right time.
At OPTIMIZE2017, Rainmaker reinforced its commitment to helping hoteliers achieve total profit optimization through a product roadmap that doubles down on the data science behind its industry leading portfolio of solutions.
Subscribe to Rainmaker's Hospitality & Gaming Blog
Join fellow Industry Professionals! Get Rainmaker's latest Hospitality & Gaming articles straight to your inbox. Enter your email address below: