Hotels, The Key To Ensuring Rate Parity Is Revenue Management Solutions
Tips for Ensuring Rate Parity without an Agreement Breach
A simple solution to parity vows is an advanced Revenue Management tool; including Rate Shopping, Rate Optimization, Channel Distribution and Online Reputation Management solutions. Not only they arm a hotel in maintaining its rate parity and integrity, these revenue management tools also make price suggestions, update online distribution OTAs, also keep you up-to-date with your online reviews & presence and place your hotel in the prime place on the OTA page to optimize bookings and eventually upsurge revenue.
The practice of this kind always guarantees a fair price for the travelers and at the same time ensure that the hotel is also making strategic and pre-emptive decisions in order to run their hotel operation profitably.
This is where a cutting edge Revenue Management Solution comes into action. Hoteliers can realize a rational rate structure with a comprehensive hotel revenue management solution.
Modern hotel revenue management tools empower hotel revenue managers to manage their room inventory and pricing by studying supply, demand, and competitive pricing in real-time.
However, no prize for guessing why increasing direct booking is a hotel’s ultimate goal. Hotels, in order to contest with their own distribution channels, are finding innovative practices to entice customers to book directly through their brand website or front desk.
In this article, we will discuss about approaches that hotel operators can use without disagreeing with their OTA agreements. Applying these Hotels can increase their direct bookings without breaching rate parity agreements.
Smart hotel operators are finding ways to offer enticements that lure customers to book directly through their brand websites, customer service desk or over the phone.
Below are a few strategies that hotels can use without conflicting with their OTA agreements and Parity issues.
Tactic #1 Offer special offers to selected customers
Parity agreements prevent hotels from offering discounts publicly; however, this constraint does not apply if the hotel does so for a selected audience, but make sure it is well hedged.
For instance – You may send discount vouchers to your social media followers, say you may offer discount codes to only your Facebook followers.
Second instance could be to offer a value-added package for vacations, or a special package for any important big event that is going to happen in your city, or a complimentary airport to hotel transfers, free parking, free breakfast and Wi-Fi, etc.
These tricks will ensure that your room rate is never lower than what the OTA has offered, however, the overall value of the package will be much higher than OTA’s room rate offer. In addition, it will also guarantee more business to the hotel during the event season.
Tactic #2 Stay connected with your regular customers
Stay in contact with your loyal customers with frequent offers and deal. Try different modes to be in touch with your customer base like newsletters, blogs, discount offers, events and festival information organized in hotels.
Also, hotels can share information of special offers every month, just to instill trust with their customers, that you are offering better rates to them.
Tactic #3 Keep your website updated
Usually a hotel’s own website seems to get the least attention when it comes to its user friendliness and booking ease. Hotels should focus on designing their website to make it easy to use to get maximum bookings. The website should capture interest immediately and there should be a call for action like “Book Now” and prominently displayed phone numbers for booking. Smartphones, tablets are a major mode for booking hotel rooms. Hotels need to have a mobile & a tablet friendly website able to take reservations and a button that will automatically call the hotel for the prospect when pushed.
Hotels might lose many bookings from the website because it is not as intuitive. A hotel’s website should be alleged as most reliable and economical source of booking by customers.
Tactic #4 Offer incentives to loyal guests
Many hotels offer gift vouchers and discounts for their loyal customers. Hotels send an email blast to their existing customer database and their subscribers. This tactic over a period of time helps in establishing a loyal customer base and eventually more bookings.
Tactic #5 Get as many reviews and drive more website visitors
Modern travelers check reviews to evaluate hotels and see which property has the highest rating. This is your chance to draw customers to your website, rather than losing them to OTAs.
In order to generate maximum positive reviews, you have to spread customer delight culture in your hotel. You can also request guests to write a review and offer discount vouchers on their next visit. Have a sign at the front desk or rooms, encouraging guests to write reviews.
In order to sustain your customers, hotel staff should respond review comment by guests especially negative reviews. This portrays that you value customer feedback and are putting in efforts to work towards providing better service.
Tactic #6 Design packaged offerings and add-on perks
Packaged offering and add-ons are another way of offering discounts, without penetrating parity contract.
To explain this further a hotel may offer a 400$ package for a 4-night stay, vis-a -vis an OTA offer of 350$, but offers perks like free pickups, Wi-Fi, breakfast etc. Add-ons are a great way to persuade guests to book through the hotel’s own website.
Tactic #7 Over the counter discount
The front desk is another direct point of contact with guests apart from your brand website. Use this face to face engaging opportunity to give customers good reasons to engage with you directly. For any customer coming through OTA, offer them a discount on their next direct booking through the hotel. This will establish a trust in the minds of the customers that the hotel is offering lower rates as compared to any OTA.
Tactic #8 Collaborate with OTAs for best results
We have discussed tactics hotels can use to encourage customers to book through the hotels. But this, in no way implies that OTAs are hotel’s competitors or opponents. In fact, we would term them as partners. As they help you get surprising booking numbers. Involve your OTAs in your promotion plans; you might consider giving them additional benefits like additional inventory etc.
For the benefit of the Industry and the traveler community, we endorse a win- win situation for both hotels and OTAs. Moreover, they can co-exist in this environment mutually benefitting each other.