Revenue managers need to take a more targeted approach to discern what data provides the most valuable information.
REPORT FROM THE U.S.— As more data becomes available, revenue managers must be able to filter and make sense of only the best information in order to achieve their goals, sources said during a Hospitality Sales and Marketing Association International webinar.
“Some people may say that we’re drowning in data, but I think it’s more accurate to say that we’re drowning in information,” said Kevin Coleman, partner and COO at Intelligent Hospitality, a hotel business intelligence company that provides reporting and analytics for hotel sales, marketing and revenue management.
The first step is to understand the context of data, Coleman said. This helps revenue managers discern good data from bad.
Discrete data points such as “200” or “$35,000” mean nothing in a vacuum. It is only when viewed as part of a larger whole—“200 rooms sold” or “$35,000 in rooms revenue”—that they mean anything, he said.
As revenue managers begin to make sense of this information and identify patterns, then it becomes knowledge. For example, if a revenue manager sees that midweek revenue per available room is lower than her competitive side, she might conclude the hotel is having a hard time drawing transient business between Tuesday and Thursday, according to an example provided by Coleman.
The next step is to come up with the best way to address the issue and take action, he said.
Action would then produce more data, and the cycle repeats, Coleman said.
Before any analysis takes place, revenue managers must help define what data is being collected in the first place, said Mark Molinari, corporate VP of revenue management and distribution at Las Vegas Sands Corporation.
“It’s really critical that revenue management is involved in the data collecting process,” he said. “It’s our job to really bring it together and get single focus points and make educated decisions.”
Defining what data to collect is one thing. Actually figuring out how to collect it is something else entirely, Molinari said. “We can’t make the decisions we do without having good data.”
For example, only 10% of loyalty card members at the Las Vegas Sands casinos in Las Vegas are staying at the hotel, he said.
“We know a lot about a small portion of our guests,” he said.
Coleman said hoteliers can institute certain processes to collect key data points. A gateway hotel, for example, might task front desk associates with asking about a guests’ country of origin upon check-in.
Producing and consuming
“A lot of us spend an inordinate amount of time producing,” Coleman said. “Ideally, we would spend more time consuming information and applying our expertise.”
Revenue managers also must help others consume it.
Business intelligence tools can help automate much of the process, allowing revenue managers to easily sort and manipulate information and allowing others in the organization to do the same, Molinari explained. Data dashboards, for instance, can help managers cut down on time spent producing data and increase time spent consuming it.
Special care must be taken when creating specific reports to specific people, he added. Because each executive has different expectations, presentations must be tailored specifically to their needs.
Molinari advised revenue managers to have discussions with various stakeholders to better understand what they’re looking for. He also suggested including an executive summary in every data report and providing a SCOT analysis to highlight strengths, challenges, opportunities and threats.
“One of the challenges is we try to make it a positive story all the time,” Molinari said. “Providing a SCOT analysis helps curb that.”
A case study
Data is influenced by two things, according to Coleman: the business process (or lack thereof) and systems and their configuration.
For example, Fairmont Raffles Hotels International’s long-term goal is to “move toward a comprehensive approach toward total revenue management by focusing on other ancillary revenue streams,” said Nathan Bacher, the company’s regional director of revenue management.
One revenue stream for a hotel is on-site restaurants. Bacher said Fairmont looked at the restaurant performances at all Fairmont hotels and devised a specific revenue-management plan for each one.
The company partnered with Avero, a restaurant analytics platform, to maximize their access to food-and-beverage metrics. Fairmont then used the additional data to develop a tool that calculated efficiency by examining revenue per available seat per hour, or RevPASH.
“The most challenging aspect was we knew we needed to make some adjustments to some things that were happening operationally,” Bacher said.