The 2017 Smart Decision Guide to Hospitality Revenue Management

Author: Avanti Joglekar

A celebrated physicist once famously remarked that prediction can be very difficult, especially when it's about the future. That certainly applies to forecasting demand for hotel guest rooms. With the advent of nextgeneration revenue management capabilities, however, predicting the future has become a lot easier, more accurate and more profitable. For those that have implemented next-generation revenue management solutions, the investment has generally paid off in spades.

In fact, according to research conducted for the 2017 Smart Decision Guide to Hospitality Revenue Management-, large and very large hotels have enjoyed a 10 percent average increase in revenue per available room (RevPAR), potentially resulting in millions of dollars in additional profit. Fueled by the rapid growth of big data processing, demand forecasting and pricing optimization models, these solutions generate pricing recommendations based on real-time analysis of relevant data. They automate the decision-making process, driving increased revenue from not only guest rooms but from all parts of the hotel property. This gives hoteliers unprecedented inventory management and pricing control.

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This Smart Decision Guide offers hoteliers a framework — and also, perhaps, additional encouragement and inspiration — for taking their revenue management capabilities to the next level. This is not a technical “how-to” guide. There is no delving into the principles of, for example, capacity management and duration control. There is no examination of the best strategies for using displacement analysis. The nuts and bolts of calculating group rates or applying rate fences to create appropriate customer segments are not among the topics covered. Those learning opportunities are available elsewhere, including in programs at dozens of accredited schools that specialize in hospitality management.

The purpose of this Smart Decision Guide is to provide decision makers with insights for selecting the right revenue management solution in the context of their hotel’s or resort’s specific needs. It also offers practical advice for putting the right resources, processes and metrics in place to maximize success and drive continuous performance improvement.  


Next-generation revenue management means optimizing profitability and not just revenue. It means analyzing ancillary revenue streams (e.g., food and beverage as well as golf, spa, etc.) along with related cost data to understand profit contributions by guest segment. For hotels with casino operations, even the “theoretical loss” (the amount of money a player can be expected to lose during their stay) can factor into the pricing model.

In the following weeks, we will delve into topics covered by the 2017 Smart Decision Guide, including topics such as purchasing considerations, vendor evaluation and comparison checklist, must-have questions for potential vendors, and internal and external perspectives on the field. Can't wait for access to the information? Click here to download the 2017 Smart Decision Guide to Hospitality Revenue Management now! 

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