Why Hotels Fail in their Distribution

Falling Online Revenues

 

For starters, almost all hotels are ‘enamoured’ by the volume of business generated by online third parties…to a point that their business would nearly die if this were to go away.

So when one operates with the feeling like your life depends on something, you naturally hold onto it with dear life.

So who are these people holding onto this revenue ? Well as you may know, the function of managing a hotel’s online distribution lies either with the Revenue Manager or the Reservations Manager.

While Revenue Managers of larger hotel groups perform more of the actual analysis and demand forecasting function, those of independents end up closing inventory on sold out dates on their channel manager with little or no time for analytics and forecasts.

Now let me clarify. We are not talking about letting their hotel be overbooked, but instead allotting time to really identify where they are heading in their overall distribution ..what is the target, how close or far are they from it, and what can be done to meet and exceed it.

So why do they not have the time?

Because, they are overloaded with managing the ‘activity’ that happens on third party websites….bookings, reconfirmations, changes, cancellations, chasing retention money…yada yada.

Now any hotelier would know, with such a flurry of activity on a daily basis, it is impossible to have time to think strategy.

So we go back to where we started… letting the third parties rule the roost and derive happiness in whatever business comes there way.

Moreover, no one has really taken the time to learn or make them understand the benefits of generating direct online business.

To make matters worse, hotels are plagued by problems such as

  1. Frequent attrition in reservations and revenue management staff.
  2. Constant costs and expenses to retrain new staff or replacements.
  3. Collapse in operational processes during the training period of the new person.
  4. Lack of communication due to low confidence of the new person.

In effect, what hoteliers end up doing is

  1. Surviving at the mercy of business received from third party sites.
  2. Opting for cheap (sometimes even free!) technology to support their ‘revenue management’ that is available dime a dozen.
  3. Closing out of inventory due to fear of overbooking.
  4. Distress selling at low prices
  5. Not meeting revenue targets.

So what’s the solution to this?

1.    Having a consistent team to perform and manage the revenue and distribution function.

2.    Enhanced processes to ensure availability at all times.

3.    Focus on generating more direct business via the hotel website.

4.    Consistency in all of the above.

How is this possible given the problems that the industry faces constantly?

Partner with Us!

Rezervoir™ is brought to you by Aurora Hospitality – the world’s premier and leading distribution management company. The focus of Rezervoir is exactly to ensure that the hotel gets all of the solutions they need to combat not only their problems but also ensure meeting of revenue targets.

Benefits of partnering with us

  • While there are many, the main benefit is higher profitability via direct online business!
  •  Performance based function costing the hotel approximately 2-6% of revenue.70+ man years of hospitality industry and profit management experience.
  • Win-win for the property where targets are met AND the hotel focusses on what it does best – guest satisfaction.Full service offering of superior technology, strategy, marketing and support.
  • Bespoke strategy for each property to ensure conversions.
  • Consistent and dedicated support from a team member.
  • Some statistics of those who partner with us are below.
  • https://www.linkedin.com/company/rezervoir
Results from High Performing Hotels

 

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