Hotel Management Strategy Guide

Guide To Creating REVENUE CENTRIC Culture InYour Hotel

In chapter 1 of, Guide to Creating a Revenue Centric
Culture inYour Hotel, we will discuss
Eight ways you can engage your entire hotel staff to become Revenue Generators
During my days of working directly with hotels on revenue optimization, I was always surprised by the lack of
understanding from the staff on the overall sales and distribution strategy of the hotel. One time, I even heard a
receptionist tell a guest to go directly to an OTA to book the room instead of taking the reservation over the
phone! Immediately I understood that not only does the hotel need more overall knowledge about the strategy
and online room distribution, but also they must be involved in the revenue generation activities of the hotel.
Due to the fact that most of the staff at independent hotels have a wide variety of tasks to perform, in depth
training and including them in the revenue generation activities can only be beneficial. Here´s how to start:
1. Revenue Management 101: Giving the staff a basic
training in Hotel Revenue Management is a good
first step in helping them understand the
sales strategy of the hotel. It´s a great idea to provide this
training to all new staff or cover it in an employee meeting.
Start with basic concepts like Supply and Demand,ADR,
Occupancy and RevPAR, Market Segmentation and
Dynamic Pricing.This is a great start to educating your
staff on the overall objectives of Revenue Management
and why we practice it.
2. Distribution 101: Most important here is to educate your staff on the cost of room distribution and
role of a channel manager.The story I mentioned above about the hotel reception staff telling the
potential guest to book directly on the OTA can make a GM, Owner or Revenue Manager cringe.
It´s a good idea to give the staff a breakdown of overall 3rd party distribution costs and how much of
that can be saved by helping to convert to direct guests. It´s also a good idea to share with them how
online distribution works and when inventory gets low and demand is high; the best idea is to sell the
last rooms direct and commission free. If you do not have a dedicated revenue manager at your hotel,
it can even be a great idea to start to involve the reception staff in online channel distribution activities
such as using the channel manager, strategically opening and closing room types, LOS restrictions, and
even finding new partners to work with.
INTRODUCTION
In today´s highly visible online market place, we simply cannot stop with a friendly smile and helpful
staff to continue to see profits rise.We must build a Revenue Centric Culture inside the hotel and
ensure that the entire hotel staff understands the importance of running a profitable hotel and
contributing to the success.
In this Guide we will learn about this subject from following aspects –
1. Ways you can engage your entire hotel staff to become Revenue Generator
2. Role of Guest Sentiment and your Online Presence
3. IntegratingTechnology to Drive More Revenue.
“ “

3. Educate the Staff - Along with the above 2 points, train your staff on the different types of guests and
the purpose of their stay.This will help them to understand much better, how to engage with them
on points 4, 5, and 6 below. It can also be a good idea to share the general demographics of your
customers with your staff to understand things like, where they are coming from, what distribution
channel/OTAs they used to book your hotel, what is the purpose of their stay, and the general spend
in the hotel (room + other). Understanding market segmentation and why it is important to have a good
balance is critical for the reception staff to understand.This can also give the staff a good understanding
of Why we collect this data and why it´s so important for us to have proper guest data.An example
from my days of working with hotels directly on strategy, I understood that our market share of the
corporate business was very weak in the market where the hotel was located.Working at the reception
was a young and motivated man that was interested to do more so I tasked him with finding a corporate
business.
I agreed with the owners on a reasonable incentive plan for this particular employee and with a little
training on reading GDS data, reports and giving him guidelines on how to find and negotiate corporate
rates, in just 6 months the hotel was able to secure more than 15 negotiated accounts and shift this
business from OTA to Corporate segment.

This also allowed them to create a good base of repeat customers and balance the segmentation mix
better.While the reported ADR was a bit lower in this segment, the hotel saw profits rise as most of t
hese accounts were negotiated directly at the hotel where we did not have to pay any commission.
4. Empower your Staff - Authorising your staff to offer discounts for direct bookings is also a good way
to give them confidence in their impact on the hotel revenue. Load a rate plan that the staff has access
to that offers a discount or value add for the customer. For example, free breakfast if they book directly
with you or -10% off the published rates, this can help convert bookings as well as giving the consumer
a sense of importance.Another great idea to offer repeat guests a discount on their future stays. Ensure
that your entire staff is trained on this. It can be as simple as giving the staff a business card with a
discount code on it to share with the guest for their next stay.You can give this to the restaurant staff
to share at the breakfast time, or to the housekeeping staff to leave in the room or give to
a guest as they see them leaving.This way you are including more than just the reception staff on these
revenue-generating activities!
5. Encourage Upselling - Upselling seems to be a missed opportunity for many hotels. Instead of trying
to upsell into a room with more space, a nicer view, or a terrace many times hotels simply upgrade the
guest free.While at times this is also a nice gesture, there is a huge missed opportunity in upsells at the
time of check in.

Let´s look at an example here.Take for example Deluxe Room that has a normal supplement of
+20€ to the standard room. In a hotel of 70 rooms, you have 10 rooms in the Deluxe Category
and on average; you upgrade 6 of those 10 rooms per day at the same price of the Standard
Category.The average annual occupancy % of Deluxe Room category is 85%. So let´s say
that out of the average 8.5 Rooms per day that this category occupies you are able to
upsell 2 of them at +10€ well that would amount to an additional 20€ per day or 7300€ per
year! That is just for 2 rooms!
So the objective here is when you cannot capture the full 20€ at the time of booking, many guests
are willing to pay a bit more during the time of check in if they are offered the options. Create an
upsell program at the hotel that incentivizes the staff to partake in this important revenue generating
activity!
6. Promote Cross - Selling is different from upselling in that we are trying to sell the guest an additional
product or service; for example breakfast or a meal at the hotel, spa treatment, retail products, and any
other concierge type of services that you can offer for the guests that can generate revenue for your
hotel.Again, education here is the key where your entire staff knows of the options available. It can
be something as simple as seeing a guest coming back from the hotel after a long day of meetings or
exploring the city and letting them know that there is a spa on-site with treatment offerings, or even the
option to order room service if they do not want to go out again. It´s definitely not rocket-science,
however, it is about education and engagement!
7. Set Goals and Incentives - Setting goals and incentive plans for staff are mandatory in order to create
a revenue culture in your hotel. Start with goals that are small and relatively achievable. Once the hotel
staff is comfortable with the revenue generation activities you can start to create some unique and
challenging goals.Along with goals must also come
rewards.This does not necessarily have to come in
the form of a monetary reward.You can also do
things like team pizza party, spa treatments, gift
cards, or movie theatre tickets. Make sure you have a
dedicated area in the hotel where the goals are
displayed and the progress is tracked. Get creative
and ensure that the staff is motivated, there
is some friendly competition and they are having fun!
8. Share and Celebrate - It is equally important to celebrate your success after hard work! Employees
love the sense of being involved so ensure they feel like an important part of the hotel success. Share
with them regularly the results of the hotel as well as results of their team or individual goals.When
goals are met, celebrate and congratulate the staff on a job well done!

Once you have implemented the above steps into your
hotel culture you are well on your way to seeing more
money come in the door. Moreover, chances are you also
have increased the morale of the employees….we all know
the saying…happy employees lead to happy guests! At the
end of the day, as hoteliers, our job is to
take care of the guest so they leave happy.

In Chapter 2 of the guide, Creating a Revenue Centric Culture
for you Hotel, we will explore the Role of
Guest Sentiment and your Online Presence.
I think by now most hoteliers understand that higher guest sentiment leads to power in pricing. In addition,
having a solid amount of reviews gives consumers confidence in making their decision.Taking that one-step
further, interacting with your guests via social media and review sites allows you to further show engagement
and empathy with guests. Let´s look at some recent research around the above:
I think most are familiar with the study by Chris Anderson of Cornell which indicates that online reputation
(review scores) and the number of reviews are positively related to hotel performance as measured by price,
occupancy, and total revenue.
In a very recent study by Cornell we look a bit deeper into how responding to reviews has an impact on the
actual review scores.
The study indicates,“while responding to reviews is positively related to online reputation, hotels are better
off responding to negative reviews than to positive reviews, adding that responding to all positive reviews may
become detrimental.” This has become an interesting study as in the recent past, hotels were encouraged to
respond to all reviews, regardless the connotation….that might be changing.
The study goes on to say “Our data don’t tell us why this is so, but we could infer that consumers potentially
become annoyed by all the review responses or the responses crowd out the reviews.We caution hoteliers
regarding how they respond, as our analysis indicates that responding to all reviews is unnecessary and
potentially detrimental on both review scores and revenues.” So the question here is how to we continue to
engage with guests on review sites without being overly “annoying”?
This can be something interesting to study at your individual hotels to understand the impact. Perhaps consider a
different approach by sending the guest that left a positive review a personal email of thanks rather than replying
via the review site.This could also be a good way to invite them back or ask them to refer the hotel to a friend.
Try sending them a discount code as part of this email so they are enticed to book again or share with their
networks.
According to a recent survey, 93% of prospect travelers refer to online reviews when booking a hotel.
Furthermore, 53% of the traveler would not even book a hotel that does not have online reviews. I do
not think these facts are surprising to anybody, however, still a good reminder of the importance of your
online reputation.
Ensure that your hotel has a dependable ORM in place that allows you to manage your online guest sentiment in
one easy to use solution. Furthermore, involve your entire staff in tracking and improving the guest sentiment.
As mentioned in chapter 1 of the guide around revenue generating activities, there should also be goals set per
department in terms of guest sentiment and these goals should be tracked, measured and celebrated when
achieved! Be sure to also measure each area of hotel vs the competitive set and see how you can strive to make
improvements in weak areas and continue to highlight the areas where you excel. Get creative in finding ways to
improve. It does not always have to be obvious. I will share a couple of examples.
“
“

While working with a boutique hotel on revenue improvement strategies, we understood that there were
a handful of rooms in the hotel that were inferior in terms of size and view, however, these were included
as part of the standard room category.The guests that usually stayed in these particular room had a more
negative experience and left poor reviews.Therefore, we decided to create a new room category, called Small
Room, which included these rooms.The description was much more accurate in terms of size and photos.That
combined with offering this room for -10€ off the price of the standard category we were better managing the
expectations of the customers.This lead to a huge boost in the review scores from guests in this particular room
type and of course improved the overall score of the hotel.
Another example from the same hotel was negative feedback around the breakfast. Guests often complained
that the breakfast area was too small, sometimes lacking places to sit and that they found the price of breakfast
to be too expensive. From our side, our hands were a bit tied in regards to the price as it was a rather extensive
buffet and our costs were somewhat high.We had little room to decrease the price of the breakfast.What we
did do however was come up with a breakfast box to-go plan where the guests had to pay 5€ (instead of 14€)
and they received a modified version of breakfast in a to-go container. By doing this, it also took care of the
problem of seating as many of the guests went back to their rooms to eat or left the hotels to start the day with
breakfast on the road.We also saw breakfast costs rise as more people bought the to-go option while previously
they were opting out of breakfast all-together. In only 6 months, we saw the breakfast revenues rise 12% and
equally as important, saw the guest scores climb!
So the lesson learned in the above examples is creating opportunities via innovation while improving guest
satisfaction and creating new revenue streams. It´s not that difficult, think outside the box and involve your staff
in coming up with innovative ideas.
Another important area to focus on while creating a Revenue Culture for your hotel is optimizing your online
presence in order to correctly showcase and sell your hotel.Although it can be cumbersome, I suggest doing a
content audit at least 1 time each year.This includes going over your hotel with a fine toothcomb on each and
every site where you have an online presence. Ensure that all details, small and large, of your hotel are correctly
portrayed.You would be surprised to find some small details missing or incorrect, however these details can be
very important for the conversion. If you do not agree with or do not like the descriptions that the OTAs have
come up with, chat with your Market Managers, sometimes they can consider making changes for you so that
you feel more comfortable with how your hotel is displayed.
Do not stop with the OTAs, ensure that you have also claimed your profile on the Metasearch sites as well.
Nowadays this is critical to ensuring good online conversion and market share. In a recent study from Koddi,
MetaSearch traffic has grown over 3x´s from 2014-2017 and is projected to drive 33€ billion in bookings in

2017. Optimize your profile on these sites by improving the photos, descriptions, and features. Ensure that all of
your amenities are well listed and actively manage your reviews. Make sure that you have high-quality photos of
all room types and areas of the hotel.Your main image is the first point of contact between the potential guest
and your hotel. Be sure to put your best representation as your main image.Trivago research shows that 86% of
clicks go to profiles with a high-quality main image.The research goes on to say that, Profiles with high-quality
photos receive 63% more clicks than profiles with low-quality or no photos. It´s an important part of revenue
generation and hotels must take an active role in creating and managing quality content for better sales and
conversion.
I hope the above suggestions have given you some new ideas to consider.The most important takeaways from
the above;
1. Know what your guests are saying and take an active role in managing your guest sentiment
2. Constantly strive for excellence and positive change via innovation
3. Ensure your online presence is optimized in order to drive more sales and better conversion
In the 3rd and final chapter of the guide, we will discuss the
topic of Integrating Technology to Drive More Revenue.
Back in 2008 while I was working for Starwood Hotels & Resorts, I remember my boss always saying Speed to
Market is the key to driving market share. She was a champion for technology development and always looking
for the best, quickest and most seamless ways to integrate technology in order to drive more market share. It
was a lesson for me early on that technology is a key component in the hotel eco-system and driving revenue.
It is incredible to see the great advances in hotel technology we have made over the last decade. It is true, as an
industry, we had to adapt to such rapid growth. However, many experts also say that as an industry, we are still
way behind on technological advances.
A study by EY Global pointed out that internet travel booking revenue has grown by more than 73% over the
past five years.At the same time, the competition to gain control of the distribution channel has intensified.
Through acquisitions of property management and digital marketing platforms, online travel agents (OTAs) are
providing additional services to encourage hoteliers to distribute rooms on their sites.
As the big chains have the budgets for technology and marketing power to address
these issues, many independent hotels or smaller chains are left feeling
overwhelmed in trying to make similar advances in technology. Because of this,
it´s imperative that hotels understand the options available to them. Find the
solutions that work the best for you and your staff and at the same time,
understand that technology is a very valuable investment. Do not rush into
the decision andtake your time to explore the different providers and what
kind of integrations/interfaces are possible between the various systems
so that everything is “talking”.
“
“

According to the Hotel Tech Report,The average hotel runs on more than 20 different technology systems and
that number continues to grow with the shift to cloud architectures and open API environments.Although that
number might be a bit lower for stand-alone and independent hotels, it is still a staggering statistic and brings
some light to the fact that we must look for a more holistic approach to technology development. Let us explore
a few ways that you can start building a revenue culture through technology developments in your hotel(s).
1. Distribution: The ideal distribution system would look a lot like the below graphic, perhaps with some
variations, however, the key here is obviously to have all of your distribution channels managed in one
place.This will ensure that your rates and availability is always up to date and your PMS is sitting with
the freshest data possible. If your current ecosystem is not close to the one displayed below, consider
making some investment to ensure that all systems are integrated.This will free up some time for the
distribution tasks and allow for more time on strategy and analytics.
2. Revenue Management: As this goes hand in hand with the Distribution, it is important to also have
your RM tool integrated with your technology ecosystem system. Effective revenue management is
dependent on aggregated information from various sources to ensure revenue managers can quickly
react to market changes. Consequently, it´s important to consolidate data from various systems and
sources to make smart decisions.A revenue management suite or an all in one solution is a good first
step that can help you make quick, intelligent decisions and have a speed to market approach in your
sales strategy.
3. Data and Analytics: As the first two parts of the technology
ecosystem listed above are more operational tools, having advanced analytics and meaningful data
is equally important to ensure a successful sales strategy.The first
step in this is data integrity. Having correct data to make these
important decisions is mandatory. If your hotel is correctly equipped from a seamless technology
perspective, then having correct data should follow. Access to
data is the next step. If your distribution system is seamless,
then most likely you will be able to retrieve quality reservation
level datfrom your PMS. In order to effectively analyze your data,

please check out my previous blog post (Blog Series Title: Managing seasonal market changes to ensure
you stay on top Part 1).This can provide you with some useful insights on deep diving into data and
correctly setting up a strategy around it.
4. A reliable ORM tool - Another critical technology system to have in place is a reliable ORM.This tool
consolidates the wide range of data regarding online guest sentiment in one easy platform so that you
can constantly improve your guest´s experience. Having technology that aggregates all of the data out
there in a single platform can easily identify pain points of your hotel.Without such a powerful tool,
both positive and negative sentiments are often overlooked.This can often help to improve operational
breakdowns in the hotel and lead to higher guest satisfaction.
5. Mobile - Friendly Website: If you have not optimized your hotel website to be mobile-friendly, do it
now, you are way behind the game. Google made changes to their algorithm in 2015 and updated that in
2016. Mobile friendly sites saw improved search rankings while un-friendly sites suffered the
consequences.When we discuss Mobile-Friendly we do not stop with the hotel website.A study
by Software Advice found that 60% of consumers are likely to choose smartphone-enabled hotels.

Nowadays it´s common to see hotels adopting such technologies
as mobile check-in, and keyless room entry via your mobile phone.
Mobile apps can be created in order to push more interaction
with yourguests, send them pre-arrival welcome notes and help
them arrange various activities inside and outside of the hotel.
Send them room service or spa menus to encourage them to
spend more on ancillary revenue. On a night with lower demand,
consider sending guests a note via the mobile app to extend
their stay or enjoy a late check out which can drive additional
revenue.The possibilities are endless, so in order to keep up
with the expectations of guests and the industry in general,
consider adopting some of the above technologies.

Hotels must comprehensively embrace technology in order to have solid analytics, drive business improvements,
enhance guest´s experiences and deliver results. It is the job of the hotelier to keep up with rapid technology
changes and assume the latest in technology.The success of these adoptions will differentiate successful hotels
moving forward.
Implementing all the above learnings will expand your mindset of creating a Revenue Culture and take you one-
step closer to becoming a better run and more profitable hotel.We can all learn from each other.
We would love you to share some of your similar experiences with us at marketing@rateGain.com.
Karen Pawlikowski has spent over 15 years working with
global hospitality brands such as Starwood Hotels and
Resorts,The Ritz-Carlton Hotel Company and Xotels in key
Revenue Management roles.
With her vast domain experience, Karen is currently working
with RateGain in leading hotels through revenue and distribu-
tion optimization strategies to achieve more profitable business.
Karen also acts as a liaison between RateGain customer needs
and the product development team to ensure that RateGain
continues to exceed client expectations and remains leaders in
hospitality technology.
About
Ms. Karen
Pawlikowski
X X
About the Author
This guide is a collaborative work of RateGain Research Team and
Ms. Karen Pawlikowski

More about RateGain
Founded in 2004, RateGain is a leading provider of cloud-based products and services around the
function of hotel Rate Intelligence, Price Optimization, Seamless Electronic Distribution and Brand
Engagement to the world’s leading Hotels and Online Travel Agents.
With continued innovation and excellence in customer focus, we are proud to serve over 12,000
clients and numerous industry partners.
Our customers are global and so are we, with offices in 10 countries across all major continents,
supported by over 500 passionate professionals and seasoned industry experts.
Through world-class solutions, RateGain helps its industry leading customers beat their competition
and make more revenue every day.
Single Technology
Platform to Manage
Revenue, Reputation
& Distribution
Competitor Rate
Shopper
1
Online
Reputation
Manager
Revenue
Optimizer
Distribution
Channel
Manager
Guest
Feedback
Survey
Integrated
Analytics
2
3
45
6
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