Automation and the Future of Revenue Optimization

In addition to being more collaborative, the revenue team of the future will be more data-driven, with analytics being an increasingly crucial skillset. Of course, more data doesn’t automatically mean better data — but it can with the help of the tools that automate growing numbers of revenue functions. “Leveraging big data and automation and machine learning and AI is the future for all of us,” said Alex Cisneros, senior vice president of revenue generation for Red Roof Inn. “We need to invest in resources and technologies and make sure that we’re partnering with the right company.”

For Dave Roberts, a lecturer at Cornell University’s School of Hotel Administration and formerly senior vice president of revenue strategy and solutions for Marriott International, automation isn’t about replacing revenue professionals. “The revenue management system of the future will not be this data dump of information and all these different dashboards,” he said. “The revenue management system of the future will make the life of a revenue manager much easier. It’ll automate a lot of stuff that they’re doing today, but it’ll help them make the decisions that they have to make so it’s seamless.”

Ten to 20 years ago, revenue optimization was an early adopter of data and machine learning, according to Cross, CEO of Revenue Analytics, “but it was always billed as, ‘Oh, this is decision support. We still need you, smart person, to make the decision.’ But today, when algorithms are capable of doing things like driving cars, why couldn’t they price the hotel?

“There’s an opportunity for the field of revenue management to say: Let’s automate things like pricing and inventory,” Cross said. “The machines are good at that, so let them do it, and let’s use people for what they’re good at, which is being creative and imaginative and coming up with new strategies that haven’t been seen before.”

Excerpted from The New Revenue Team, a new white paper available from HSMAI and Revenue Analytics. For additional information, insights, and tools, visit HSMAI’s Global Coronavirus Recovery Resources page.

HSMAI Customer Insight: Trending into the Holiday Season | Google

What a year. As 2020 comes to a close, and the US is seeing an alarming resurgence in COVID cases nationwide, we are seeing that some behaviors may be sticking around longer than previously anticipated. As we look towards recent search trends, here are the ones that remain top of mind:

Travel This Holiday & The Preference for the Road

Heading into the holiday season, many consumers are eager to get home for the holiday or to get away. 2 in 5 Americans were planning to take a trip that involved an overnight stay this holiday season (40%), including 10% who had already booked a trip in November and 30% who said that they were very/somewhat likely to do so soon[1]. Early reports from the TSA are showing that nearly 2 million people passed through airports this past Friday & Saturday, despite a record number of new cases and CDC recommendations not to travel. For many though, driving to their destinations remains the preferred option. 76% of consumers willing to travel this year indicated earlier this fall that traveling by personal car is their first choice (76%), followed by rental car (29%)[2]. We see this reflected still in recent search behavior- searches for “along my route” have grown by over 1,000% YoY[3], and searches for “gas station near me now” have grown by over 80% YoY[4]. Even searches for “electric vehicle charging” have grown over 300% YoY (top searches include “electric vehicle charging points”).[5]

Meet Me Outdoors

Whether in a new destination, or staying local, consumers continue to be seeking socially distant outdoor options for socializing and entertaining. Searches for “near me with outdoor seating” have grown by over 900% YoY[6], and searches for “patio heater” have grown by over 600% YoY (top searches include: “pyramid patio heater”, “Infrared patio heater”, and “table top patio heater”).[7] We even see that searches for “best outdoor” have grown by over 100% YoY, which includes searches for “best outdoor tv”, “best outdoor camera”, best “outdoor solar lights”, and “best outdoor basketball shoes”,[8] highlighting the importance that outdoor options and availability will continue to play in the coming months.

Super Parenting

Families have seen their fair share of difficulties during this past year, and parents are seeking ways to keep their families safe and together. Searches for “masks for kids” have grown over 600% YoY[9], indicating that safety and caution are still priorities. Entertainment searches are also on the rise, as searches for “family movies on___” and “jigsaw puzzles” have grown by over 100% YoY respectively[10]. As school openings and distance learning continue to find the right balance, searches for “___ of the day for kids” has grown by over 100% as well (top searches include: “riddle of the day for kids”, “thought of the day for kids with meaning”)[11]

Key Takeaways

The trends that have emerged this past year will continue to evolve, as regions continue grappling with the resurgence in COVID cases nationwide, impacting when and how consumers travel. For marketers, continue to stay on top of consumer demand, and understand the new needs and priorities of consumers. Whether for the road, the outdoors, or for families, find the best ways to accommodate for them and identify ways to pivot. Consumers willing to travel during this time have demonstrated both caution and agility. Make sure you meet and support them where they are at this moment.   

[1] Google/IPSOS, Omnibus, November 2-3, 2020, US adults 18 & older, N=1,005
[2] Google/Storyline strategies, Travelers & Covid-19, September 2020, US recent travel bookers who research travel online, n=1500
[3] Google Data, Global English, Aug 26, 2020 – Oct 24, 2020 vs Aug 26, 2019 – Oct 24, 2019
[4] Google Data, Global English, Aug 26, 2020 – Oct 24, 2020 vs Aug 26, 2019 – Oct 24, 2019
[5] Google Data, Global English, Aug 26, 2020 – Oct 24, 2020 vs Aug 26, 2019 – Oct 24, 2019
[6] Google Data, Global English, Aug 26, 2020 – Oct 24, 2020 vs Aug 26, 2019 – Oct 24, 2019
[7] Google Data, Global English, Aug 26, 2020 – Oct 24, 2020 vs Aug 26, 2019 – Oct 24, 2019
[8] Google Data, Global English, Aug 26, 2020 – Oct 24, 2020 vs Aug 26, 2019 – Oct 24, 2019
[9] Google Data, Global English, Aug 26, 2020 – Oct 24, 2020 vs Aug 26, 2019 – Oct 24, 2019
[10] Google Data, Global English, Aug 26, 2020 – Oct 24, 2020 vs Aug 26, 2019 – Oct 24, 2019
[11] Google Data, Global English, Aug 26, 2020 – Oct 24, 2020 vs Aug 26, 2019 – Oct 24, 2019

HSMAI Customer Insight: Top U.S. Thanksgiving destinations by hotel occupancy | Amadeus

Based on hotel bookings for the week of November 22-28, Amadeus sees potential improvement in Thanksgiving holiday forward-looking occupancy compared to Labor Day. As Americans approach what is traditionally the busiest travel day of the year – the day before Thanksgiving – many people want to know if it will maintain its status, albeit under very different circumstances as COVID-19 cases continue to rise again. Amadeus, with its unique ability to track forward-looking occupancy in major markets around the world, is seeing a positive trend in hotel bookings the week of U.S. Thanksgiving. While overall occupancy remains below 2019, there are many areas showing higher occupancy levels one week out, indicating the 0-7 day booking window has increased slightly.

Key insights:

Top Thanksgiving destinations with over 50% hotel occupancy are (see Figure 1):

  • Moab, UT
  • Sedona, AZ
  • Key West, FL
  • George, UT
  • Sierra Vista, AZ
  • McAllen, TX
  • Vail, CO
  • Prescott, AZ
  • Brownville, TX
  • Santa Barbara, CA

Destinations in national park hot spots continue to be popular with Moab, UT, and Sedona, AZ, at the top of the list and nearing 80% occupancy, both with access to parks known for the red rock formations – Arches National Park and Red Rock State Park, respectively.

Figure 1: Top US markets by occupancy and weeks the bookings were made for the week of Thanksgiving

Booking windows are lengthening, but last-minute travel remains popular (see Figure 2):

According to Katie Moro, Vice President, Data Partnerships, Hospitality, Amadeus, “For the summer holidays of Memorial Day, July 4th, and Labor Day, we saw a steady occupancy build-up from weeks 3 to 2 to 1, with Labor Day at a final occupancy of 41%.

“For Thanksgiving, occupancy levels are trending higher compared to the summer holidays, and we are encouraged by seeing a number of markets with occupancy above 50% and in some cases nearing 80%.”

Figure 2: Booked hotel occupancy according to booking window.

Travelers are escaping the big cities

Where are these people coming from? Travelers who have booked trips with a hotel stay appear to be taking a break from big cities like New York, Los Angeles, Atlanta, Dallas and Chicago, for destinations with wide, open spaces. Top cities with travelers getting away with a hotel stay for Thanksgiving are:

  • New York – Northern New Jersey – Long Island, NY-NJ-PA, US
  • Los Angeles – Long Beach – Santa Ana, CA, US
  • Atlanta – Sandy Springs – Marietta, GA, US
  • Dallas – Fort Worth – Arlington, TX, US
  • Chicago – Naperville – Joilet, IL-IN-WI, US
  • Houston – Sugar Land – Baytown, TX, US
  • Washington – Arlington – Alexandria, DC-VA-MD-WV, US
  • Miami – Fort Lauderdale – Pompano Beach, FL, US
  • San Francisco – Oakland – Fremont, CA, US
  • Philadelphia – Camden – Wilmington, PA-NJ-DE-MD, US

For more best practices on leveraging data to build an effective marketing strategy, please visit our Planning for Hospitality Recovery resource center.

HSMAI Customer Insight: The Black Traveler | MMGY

The Black Traveler: Insights, Opportunities & Priorities report is the first in a series of MMGY Travel Intelligence market research studies to be informed by diverse travel advocacy organizations to better identify the needs, behaviors and sentiment of underrepresented travel communities. The Black Traveler report shares that Black U.S. leisure travelers spent $109.4 billion on travel in 2019 – the most recent year reflecting normal travel spend prior to COVID-19. This spend was generated by 458.2 million Black U.S. traveler stays, which represents 13.1% of the U.S. leisure travel market. The report also found that in 2019 Black leisure travelers took an average of three overnight vacations and spent an average of 13.1 nights in paid accommodations. U.S. Black travel parties spent an average of $600 on each overnight leisure stay, with an average stay of 2.5 nights for each trip.

The Collaborative Revenue Team of Tomorrow

As the hospitality industry moves forward — through the pandemic, into recovery, and afterward — what will happen to the revenue team? According to experts in hospitality revenue optimization, it won’t return to its pre-COVID model. Instead, while staffing ramps back up, the revenue team will retain the flexible configurations and operating efficiencies that it has developed in response to the crisis.

In some ways, that will mean starting over. “In a way, what I think we’re going to see is most hotels will be creating new history,” said Dax Cross, CEO of Revenue Analytics. “I have a hard time believing that there’s going to be some point in time where people say, ‘Okay, now 2019 is relevant again.’ “I think 2019 is lost forever in terms of relevancy of the data,” Cross said, “and you’re going to see a slow climb back. At some point, maybe in 2022, the data from 2021 will be relevant again, but still, I think recent trends will be more relevant than that history.”

That new history will use the innovations of the pandemic as a jumping-off point — and continue to evolve, including becoming more collaborative. “The leaders of the future will be very well-versed across multiple disciplines,” said Dave Roberts, a lecturer at Cornell University’s School of Hotel Administration and formerly senior vice president of revenue strategy and solutions for Marriott International.

And not only sales, marketing, and revenue, but “also across other areas of the business, including finance and asset management or real estate, because those decisions are completely related,” Roberts said. “It used to be the case that those disciplines functioned somewhat independently and then occasionally compared notes, but today, there’s nothing that you can do in one discipline that doesn’t have a direct impact on all of those other disciplines.”

Excerpted from The New Revenue Team, a new white paper available from HSMAI and Revenue Analytics. For additional information, insights, and tools, visit HSMAI’s Global Coronavirus Recovery Resources page.

HSMAI Customer Insight: Travelling By Car Still Deemed Safest By Far | MMGY

It’s inarguable that travel as an industry will be on the frontlines of the economic recovery, and navigating the pandemic safely is our first priority. But as marketers, it’s not just a dollars and cents game. Travel, at its very essence, brings joy. It elicits a sense of anticipation. It satisfies our very core human needs to connect and learn. Even the planning part is fun! As our industry and all of its many partners unite around the goal to bring travel back responsibly, Americans are telling us this is what they want – but they are scared. Let’s continue to talk about the messages that will inspire confidence and excitement in the coming phases of recovery. Below is a link to our latest travel safety barometer which provides the latest insights into how to navigate the next normal as it unfolds. 

MMGY Global Travel Safety Barometer, November 2020

HSMAI SPECIAL REPORT: Best Practices – 2019 Platinum HSMAI Adrian Awards

Every year, HSMAI’s Adrian Awards program honors creativity and innovation in hospitality advertising, digital marketing, and public relations. When we recognized the winners of the 2019 Adrians at the Adrian Awards Dinner Reception and Gala in New York City on Jan. 21, 2020, we had no idea that would be the only time we would gather our community together in person this year.

But COVID-19 had other plans for both HSMAI as an organization and hospitality as an industry. And now more than ever, we find inspiration in the advertising, digital marketing, and public relations campaigns that stood apart.
To that end, this Special Report — presented with the support of HSMAI’s 2020 Organizational Member companies — offer profiles of the 24 campaigns that won Platinum honors as part of the 2019 Adrians. We hope you’ll find their ideas and examples valuable as we work together to steer hotel sales, marketing, and revenue optimization into and through recovery.

To learn more about these and other Adrians winners, visit adrianawards.hsmai.org.

How the Pandemic Has Changed the Revenue Team

It didn’t take long for the pandemic to disrupt the traditional revenue staff model, which typically placed a manager or director of revenue at the property level with a regional director or vice president working above-property. Layoffs and furloughs have changed everything from how the revenue team is organized to how it operates — including clustering the function among multiple properties.

“We’ve had to reduce revenue management teams on-property,” said Monica Xuereb, chief revenue officer for Loews Hotels & Co. “We were fortunate before to have up to two people at each hotel doing revenue management — something a little bit different than most other companies – but now, for the most part, we have joint revenue management, with people doing one to three hotels.”

Dax Cross, CEO of Revenue Analytics, added: “There was already a trend to move revenue management from on-property to above-property. So, the on-property director of revenue management at your big full-service hotel has over a number of years been slowly replaced by things like cluster revenue management by a team at a hotel management company or a chain. I think you’re going to see even more of that because people are being required to do more with less. And that means the ability to manage multiple properties easily is much more important.”

For Hyatt Hotels Corporation, COVID has indeed led to more clustering, as Cross predicted, along with positions minimized above-property. “Hyatt minimized the teams at our corporate office, and that drastically impacted our revenue team at the corporate level from a leadership standpoint,” said Christen Garb, vice president of global revenue management operations for Hyatt. “We’ve always had regional directors of revenue, and that’s what was minimized. And then, at the property level, there were areas where it made sense to cluster. Instead of a key downtown city having three directors of revenue over three big hotels, in some markets where it made sense, that was moved to an area director of revenue position.”

Excerpted from The New Revenue Team, a new white paper available from HSMAI and Revenue Analytics. For additional information, insights, and tools, visit HSMAI’s Global Coronavirus Recovery Resources page.

The New Revenue Team

The Hospitality Sales and Marketing Association International (HSMAI) and Revenue Analytics present The New Revenue Team, a white paper offering insights into hospitality revenue during the COVID pandemic. The publication examines revenue teams during the pandemic and after the pandemic, and identifies the right solution for right now.

The New Revenue Team focuses on three main topic areas: 

Revenue in the Time of COVID
Revenue optimization teams in the hospitality industry haves changed during the pandemic. COVID-19 has led to more clustering at the property level as well as big cuts above property. The pandemic has also helped break departmental silos, as hotels get leaner, leading to greater collaboration among teams. Mass amounts of data have led hotels to prioritize data analytics 

Revenue After COVID
Looking ahead, revenue experts are predicting how hotel revenue models will work post-COVID-19. Revenue models may remain flexible and maintain many of the efficiencies used during the pandemic. Additionally, revenue teams may become even more collaborative, strategic, and analytic going forward. 

The Right Solution for Right Now
Revenue Analytics has developed N2PricingTM, a tool that responds to the unique dynamics created by the pandemic and reflects hospitality trends that Revenue Analytics has observed for years. 

Access The New Revenue Team