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By Marios Prokopiou, Associate Principal, ZS
According to a new Hospitality Sales & Marketing Association International survey, two of the top challenges that revenue management professionals face are the evolution of predictive analytics, and the optimization of data and up-to-date technology to advance decision making. Both challenges can be addressed by adding analytical firepower to your revenue management staff, and that starts with hiring more analytics geeks.
Many directors of revenue management and regional revenue managers started their careers in the hotel reservations, front desk or even sales departments. While their industry experience and market knowledge are valuable, they often don’t have the analytical backgrounds that are necessary for making more scientific decisions. Instead, they use their industry knowledge and intuition to make decisions about pricing and inventory, which could result in missed revenue opportunities.
What if you build a revenue management team with a mix of hospitality industry veterans and science, engineering and economics grads who are capable of running in-depth analyses, and visualizing and solving complex problems? These analytics geeks will understand the science behind your RM systems and trust system recommendations and find new ways to implement RM and pricing strategies. While experienced revenue managers tend to be reactive to what’s going on in the market and how competitors are behaving, analytically minded new hires likely will be proactive, using data mining techniques to look for new revenue opportunities.
However, while these geeks are more likely to experiment and take calculated risks, they need to collaborate with experienced RM managers to develop overall strategies and build their industry knowledge. Keep in mind, too, that it’s not enough to simply hire analytical people. You also must provide good onboarding programs, training, mentorship and development inside the department, so those people can advance to leadership positions. One way to offer this type of development is to share lessons learned. Have regular meetings where a staff member shares an idea that worked—or didn’t work—and why and have the rest of the team provide feedback.
To have a successful revenue management team, experienced revenue managers and the analytically minded need each other. By finding the right mix of people and mentoring these new hires, your staff will be better positioned to unlock profit opportunities.