Fivestar Hospitality has started a collaboration with RoomPriceGenie to draw attention to one of the most important factors for the success of your hotel or accommodation unit \u2013 your pricing policy.<\/p>\n\n\n\n
And today, in a joint mission to provide dynamic pricing policies to everyone, we recommend the new RoomPriceGenie service that makes starting in this direction much easier for you.<\/p>\n\n\n\n
We present the amazing new service called GenieIntelligence<\/em><\/strong>, also known as \u201cThe Email\u201d<\/em>. We have managed to concentrate a significant part of our knowledge and a lot of data into a daily email, which provides recommendations regarding your pricing policy. We would love for you to try it<\/a> immediately.<\/p>\n\n\n\n We have supported the pricing policies of thousands of hotels and seen those of many thousands more, so we thought we\u2019d share some tips for a better pricing policy. What would we do if we were to work on your pricing policy?<\/p>\n\n\n\n Stage 1: setting up one year in advance:<\/strong><\/p>\n\n\n\n The first step in establishing a pricing policy is to make a best-estimate price calculation for one year ahead. This activity is generally a combination of art and science, especially under current circumstances.<\/p>\n\n\n\n To do this, you could first analyze your hotel’s seasonal<\/strong> performance in previous years and across different months. What was the average rate you charged, and how quickly did you sell your inventory of available room-nights? If you sold out too quickly, then you can try starting with higher rates this year. If reality turned out below expectations, you could start with lower rates this time.<\/p>\n\n\n\n Then, you should do the same for the days of the week<\/strong>. How did you perform on Sundays or other weaker days, and what adjustment would you like to make to the average rate of these days compared to previous years? The same applies to all other days of the week. You should create a regular weekly cycle of rate evolution within the seasons you have defined.<\/p>\n\n\n\n In current circumstances, history may not be the best guide, and it would be wise to check how the hotels you compete with are pricing. Generally, you should look at those properties that are best managed and have the best performance. The Google Hotel Search<\/strong> tool is excellent in this regard. Simply click on a hotel and then click on the calendar to see the prices set for future dates. You can use their patterns to form an idea of how to judge your own case.<\/p>\n\n\n\n Then, finally, think about special dates<\/strong> that need to be set at higher rates. You can use information from other properties here as well, along with your own knowledge of local events and holidays.<\/p>\n\n\n\n You can use all these forecasts to create a pricing pattern for your most popular room type, and then you can set rates for all other rooms by applying some rate distancing rules.<\/p>\n\n\n\n This entire process can be assisted by revenue management software, such as that offered by RoomPriceGenie<\/strong>, but a traditional Excel spreadsheet can also handle this problem.<\/p>\n\n\n\n Stage 2: daily price management:<\/strong><\/p>\n\n\n\n At least once a week, but preferably every day, you should check what is happening. There are two important things you need to track.<\/p>\n\n\n\n What are your competitors doing?<\/strong> This is very important in these times when demand is uncertain. Are they raising or lowering prices? If you are caught off guard, you will either lose profits by selling at lower rates or lose occupancy by not selling enough rooms.<\/p>\n\n\n\n By keeping an eye on the rates of the best-managed hotels<\/strong> you compete with, you will ensure you don’t miss special dates you didn’t know about or even a trend of increasing bookings for the entire season, as we saw in many properties in Europe in the summer of 2020. The sooner you notice these trends, the better.<\/p>\n\n\n\n It is also important to remember that your potential customers do not look at your prices in a vacuum \u2013 they will compare your hotel with the other options they have. If you are not aware of the competition<\/strong>, they may be one step ahead.<\/p>\n\n\n\n How are you actually performing?<\/strong> You should always be aware of the booking pace and occupancy rate for the immediate future for two reasons.<\/p>\n\n\n\n The first is that these indicators signal when demand<\/strong> for your property is not what was previously expected. Being aware of this means you can change rates faster to reflect the change in demand.<\/p>\n\n\n\n The second is that, knowing how many rooms you have left to sell, you can change your rate to try to sell that number. For example, if I have only one room left to sell in 2 weeks, I might set a rate of 100 EUR, but if I have 20 rooms left, I might want to sell at 60 EUR.<\/p>\n\n\n\n By keeping in mind what your competitors are doing, how the best-managed hotels are changing rates, and your own performance, you can keep your prices competitive and as high as possible.<\/p>\n\n\n\n Once again, technology can help here. By signing up for the free trial version of the GenieIntelligence<\/strong> email or the full RoomPriceGenie product, a large part of these activities requiring mathematical skills can be done automatically for you.<\/p>\n\n\n\n Stage 3: promotions, restrictions, etc.:<\/strong><\/p>\n\n\n\n The next step is the good use of restrictions and promotions. There are too many possibilities to list them all here, but here are a few examples:<\/p>\n\n\n\n We offer more tips in our free book 49 tips for smaller properties<\/a>.<\/p>\n\n\n\n