Frequently asked questions: Mastering hotel pricing strategies to boost your revenue

Setting the “right” prices for your hotel rooms to attract the right guests and maximise revenue can feel like a quest we could title: “Fantastic Beasts and Where to Find Them. ”

The work involved in finding the “right prices” brings a lot of headaches to many hoteliers, especially if you’re juggling a few different jobs at the same time: managing the hotel, customer service, housekeeping, and now also revenue management.

The simplest advice might be: get a revenue management system – it will find the right price for you. While that’s true, we’re here to equip you with revenue knowledge, because the more you understand, the more confident and in control you’ll feel over your pricing and revenue strategies.

That’s why in the webinar ‘Increase revenue with the right pricing strategies: Q&A with experts,’ our friends from revenue management guru RoomPriceGenie answered some of your most common questions to help you find the right prices for your hotel rooms.

In the hospitality industry, setting objectives as a hotel owner involves an analysis of several key metrics: revenue, occupancy, and average daily rate (ADR).

First, assess how much money your property is making and its current occupancy levels. Compare these figures with those from the previous year to identify areas for improvement. Key metrics to focus on include Revenue per Available Room (RevPAR), which combines occupancy and ADR to give a comprehensive view of performance. RevPAR is crucial as it reflects how well you are using your available inventory.

Set specific targets for total revenue, ADR, and RevPAR based on past performance and future goals. This helps ensure you’re not underselling rooms too far in advance or overpricing them at the last minute, which could lead to last-minute price drops to fill rooms. Regularly track these metrics to stay on course and adjust strategies as needed to optimise revenue and occupancy.

When setting your rates, there are numerous factors to consider, given the vast amount of data available today.

Hendrik Niehues, Sales & Revenue Manager at RoomPriceGenie, shared during the webinar:

“We’re living in a world where data is endless, and we can take more and more and more data into account. So it all depends on how much time we have. How many tools we use, and it’s not just coming down to a revenue management system, but everything around it.”

  1. First, consider the size and location of your property. Larger properties with more resources might delve deeper into data analysis, while smaller properties might start with basic comparisons.
  2. Assess your competitors and understand their pricing strategies, amenities offered, and their reputation scores on platforms like Booking.com and Google.
  3. Next, evaluate your offerings. For instance, if you offer breakfast but not dinner, you should not compare your rates directly with resorts that provide full meal services and spa facilities. Each amenity adds value and can influence your pricing strategy.
  4. Finally, set realistic goals based on your property’s unique characteristics and objectives.

Whether you aim to maximise revenue to the last percentage point or take a more straightforward approach, understanding these variables will help you set competitive and profitable rates.

Read ‘Keep Your Eyes on the Prize: Setting Objectives in Hotel Revenue Management’ to learn more about setting revenue management objectives for your property.

To know if you’re on the right track with your pricing, you need to monitor both your property data and market data. Start by ensuring you have a clear budget and objectives. If your occupancy rates are consistently around 85-90% during high-demand periods, and your lead times are reasonable, you’re likely maximising revenue effectively. However, if you’re reaching high occupancy too far in advance, it suggests you may have priced too low, missing potential higher revenue.

“If for example, let’s say for August, which is three months from now, you are already at 80% occupancy, then even if you are in a destination with a larger booking window, you most likely have sold too cheap, because you still have a long time to get to that month, and you are already almost at full occupancy.

The owner might be happy because he sold everything and sometimes owners are happy with that, but he could have made more considering what the market was willing to pay for his property”– explains Sales and Revenue Manager in Spain, Jose Miranda.

Additionally, review your value-for-money scores on OTAs or review sites. High scores suggest you could charge more, while low scores might mean you’re overcharging for what you offer.

“This helps you determine how your customers perceive your value for money. You don’t want to be way too high, but you don’t want to be too low either. So you want to sit at the right level, especially compared to hotels around you.

If your value-for-money score is really high, could this indicate that you have some potential to charge a little bit more?

And if your value for money score is really low, then that’s also something I would look at and ask myself: could it be that you’re charging a little bit more than what you have to offer?” – adds Sales & Revenue Manager for APAC, Giulia Orlando.

In essence, it’s crucial to constantly monitor booking pace, competitive pricing, and customer value perception. The least time-consuming way is to utilise a system to track pricing fluctuations and your market position. Revenue management systems, like RoomPriceGenie, can significantly ease this process, providing insights that manual tracking might miss.

Knowledge truly is power, and data provides you with the insights needed to make smarter, faster, and more effective decisions. Here’s how to use data to improve your pricing strategies:

In revenue management, leveraging data is crucial to crafting effective pricing strategies. Knowledge derived from data empowers us to make smarter decisions faster and improve overall performance. Here’s how to effectively use data to enhance your pricing strategies:

1. Learn from the past

Use reports from your property management system (PMS) to analyse historical data. This can help you understand past performance and make informed decisions for the future. For
instance, if your booking report reveals a high volume of deeply discounted rates through an OTA channel well in advance, it may indicate that you’re allocating too much inventory to that channel. Adjusting this can help you maximise revenue closer to the booking date.

2. Booking window insights

Pay close attention to your booking window. If you notice that deeply discounted rooms are being booked far in advance (e.g. 90 days out) while your typical booking window is only 14 days, it suggests you might be offering discounts prematurely. This insight allows you to pull back and offer discounts more strategically, ensuring you maximise revenue.

3. Put your detective hat on

Think of analysing data as detective work. You need to sleuth out the best price at the right time. This involves understanding whether your customers are corporate or leisure, their booking behaviors, and their price sensitivities. For instance, if you’re struggling to fill rooms closer to the date, you might need to adjust prices or offer discounts.

4. Key reports

Use key reports and indicators from your PMS to track crucial metrics. In Seekom’s system, these might include the revenue report, occupancy and revenue report, occupancy rates report, average daily rates report and revenue per available room (RevPAR) report. Accurate reports can help you pivot your strategies quickly. For example, if you see high occupancy but low RevPAR, it might be time to increase rates or adjust your marketing strategies.

5. Ensure you collect the right data

“Make sure that your data is accurate because many times when working directly in the hotel operations, we had to check the reports and fix them because we were collecting wrong data.

So train the whole staff to make sure they are properly filling in all of the fields in the PMS so you can get good data to trust,”- says Sales and Revenue Manager for North America, Leslie Hoy.

6. Compare your property’s performance with market data.

This helps you understand if you’re on the right track. For example, if your value-for-money scores on OTA sites are significantly higher than your competitors, it might indicate you have room to increase prices. Conversely, if your scores are lower, you may need to enhance your offerings or adjust prices.

Should you check it all the time or maybe once a week?

Determining the frequency of pricing performance reviews is crucial and varies depending on several factors, such as the size and type of property and the tools available for managing prices. For large properties, like a 400-room hotel near an airport, frequent price checks are essential due to the high volume of bookings and the competitive nature of the market. In contrast, smaller, family-run hotels with fewer rooms might find that less frequent reviews suffice.

For properties equipped with a revenue management system, even smaller establishments with 10 to 30 rooms can efficiently manage pricing by conducting strategic reviews a few times a month. In regions like APAC, it is recommended to review pricing strategies at the beginning and end of each month to ensure alignment with market conditions and to identify any necessary adjustments. Ultimately, the goal is to strike a balance that suits the property’s specific needs, enabling you to optimise your pricing strategy while dedicating more time to improving guest experiences and overall operational efficiency.

When you are new to dynamic pricing, transitioning from manual methods to a more flexible pricing model can seem scary. The initial fear is understandable, given the abundance of information and various tools available. However, at its core, dynamic pricing revolves around the basic economic principles of supply and demand. Embracing this approach with an open mind can lead to significant benefits.

“I would say don’t be afraid to push your limits a little bit in terms of increasing or decreasing your rates.

Testing those limits can really help you understand and learn where you can really drive rates and capitalise during your high demand periods or when you might want to draw pricing and take more occupancy based pricing.”Hannah Lee, Sales & Country Manager North America at RoomPriceGenie.

Approach dynamic pricing with flexibility and a willingness to adapt, as these qualities will be crucial in leveraging this strategy effectively for your property.

As for your guests, most travelers are already used to the price changes – either from big hotel chains or airlines. In fact, the study that we did with ZHAW School of Management and Law on the effect of dynamic pricing in hotels showed no significant change in overall guest satisfaction, perceived price fairness and intention to recommend the hotel.

The unpredictability of the hospitality market requires regular price and market monitoring to stay competitive. Dynamic pricing, which adjusts rates based on demand, is increasingly being adopted to cope with these fluctuations. However, without automated tools, the process of manually checking prices can become overwhelming and still fall short. Implementing a reliable pricing tool can significantly reduce the manual workload, automating daily price adjustments and allowing you to focus on strategic tasks such as enhancing guest services and training staff.

Watch the webinar “Increase revenue with the right pricing strategies” on demand

All of the above is just a small portion of what we have discussed during the webinar ‘Q&A with experts: increase revenue with the right pricing strategies’. You can watch the full webinar to get answers to questions like:

  • What are the core responsibilities of a Revenue Manager
  • Does the RMS make sense for smaller properties
  • What things should you consider when evaluating RMS solutions
  • What are the differences in theory and execution between pricing for traditional hotel rooms versus a standalone Airbnb
  • New hotel versus established property: should pricing strategies differ for the new hotel versus the established one?

Now is the time to embrace revenue management!

Revenue Automation is changing the accommodation business. It’s helping hoteliers make smarter decisions and freeing them up to take better care of guests and support their team. This is especially crucial for small properties with limited resources. Today, hotels that use automated pricing software are at a distinct advantage over hotels that don’t. They have more time, less stress, and more revenue. However, the adoption of these tools is happening so fast that it won’t be long before they become mainstream and properties without pricing software will be at a serious disadvantage.

Now is the time to implement automated pricing. Not only will you make more revenue while you sleep, but you will also sleep more peacefully.

Ask your Seekom contact for more information about how to start with RoomPriceGenie for free.

Boost Your Accommodation Business with Google My Business: A Step-by-Step Guide

In today's digital age, having a strong online presence is essential for accommodation providers such as motels, hotels, short-term rentals, and campgrounds. One of the most effective tools to enhance visibility and attract guests is Google My Business (GMB). This article explores how leveraging GMB can benefit your business and provides a clear guide to get started.

Seekom google my business

Why Google My Business Matters:

  1. Enhanced Visibility: A well-optimised GMB profile ensures your accommodation appears prominently in local Google searches. This visibility is key to capturing the attention of travellers and locals searching for places to stay in your area.
  2. Improved Customer Engagement: GMB allows direct interaction with potential guests through reviews, questions, updates, and more. Engaging with customers on GMB builds trust and credibility, encouraging more bookings.
  3. Enhanced Local SEO: By optimising your GMB profile with accurate information, appealing photos, and regular updates, you can improve your local SEO rankings. This means more organic traffic and potential bookings for your accommodation business.

1. Sign Up for Google My Business:

You can now set up and schedule emails to be sent to guests during select time periods. This will be useful for those who want to send messages to guests at key times, perhaps to inform them of visitor rules during event weekends or remind them to keep noise down after midnight on New Year’s Eve.

Sign Up for Google My Business
Seekom google sign in

2. Enter Your Business Details:

  • Provide your business name, address, phone number, and website URL.
  • Select the appropriate business category (e.g., motel, hotel, campground).

3. Verify Your Business:

  • Choose the verification method (usually by phone or mail to your business address).
  • Follow Google's instructions to complete the verification process.

4. Optimise Your GMB Profile:

  • Upload high-quality photos of your accommodations, amenities, and local attractions.
  • Craft a compelling business description using relevant keywords to attract potential guests.
  • Ensure accurate business hours, including any special hours during holidays or events.

5. Utilise GMB Features:

  • Regularly post updates, promotions, events, and special offers to keep your profile active and engaging.
  • Respond promptly to customer reviews and messages to demonstrate excellent customer service and foster positive relationships.
uploaded images to Google bussiness account
how to create GMB

6. Monitor Performance and Insights:

  • Use GMB's insights to track how customers find your business and which actions they take (e.g., website visits, calls).
  • Adjust your strategy based on these insights to continually optimise your GMB presence.

In conjunction with Google My Business profile you can integrate Google Hotel Booking links with your profile. This will help you get bookings directly from the Google Search page. For more information, please visit our fully managed plan option.

If you are confused about what products or services suit your needs better, get in touch with our support team and we will guide you through.

Conclusion: Google My Business is a powerful tool for NZ and AU accommodation businesses aiming to increase their online visibility and attract more guests. By utilising its features effectively—enhancing visibility, engaging customers, and optimising your profile—you can position your business for success in the competitive short term rental market.

Comprehensive Content Template for Motel, Hotel, Campgrounds, B&B Websites

General Best Practices:

  • Focus on Clarity: Ensure your content is clear and straightforward. Use simple language that your audience will understand.
  • Target Keywords: Include relevant keywords naturally in your content to improve SEO.
  • If you are in Nelson (Nelson accommodation is a relevant keyword). Think about what your visitors might use to search for an accommodation option.
  • Engaging Headlines: Use engaging headlines with your target keywords. Headlines should be descriptive and entice the reader to continue reading.
  • Content Structure: Use headings (H1, H2, H3) to structure your content, making it easier for both users and search engines to navigate.
  • Image Optimization: Use alt tags for images, describing the image content. This improves accessibility and SEO.
    Call to Action (CTA): Include clear CTAs to guide users on what action to take next, such as booking a stay or contacting for more details.
  • Make sure each page has at least 800 - 1000 characters of text (google can only read and present text when users search for relevant content). Having text helps Google understand the context.

Page-specific Guidance:

Home Page

  • H1 Tag: Your main headline, include your primary keyword, e.g., "Comfortable & Affordable Motel in [Location]".
  • Introduction: Briefly introduce your motel, focusing on unique selling points.
  • Sections: Use H2 tags for section headings like 'About Us', 'Our Rooms', 'Facilities', etc.
  • Content Flow: Ensure the content flows logically, guiding visitors from an introduction to exploring rooms, facilities, and finally to booking.

Booking Page

  • H1 Tag: Clear and inviting, e.g., "Book Your Stay at [Motel Name]".
  • Instructions: Provide simple, step-by-step instructions for booking.
  • Details: Include information on cancellation policies, payment methods, etc.
  • CTA: "Book Now" buttons, prominently displayed.

Contact Us

  • H1 Tag: "Contact [Motel Name]".
  • Content: Include different ways to contact (phone, email, contact form).
  • Map: Embed a Google Map with your location.
  • CTA: Encourage visitors to get in touch with any questions or to book directly.

Facilities

  • H1 Tag: "Explore Our Facilities".
  • Description: Detailed descriptions of your facilities, including any unique features or amenities.
  • Images: Use high-quality images of your facilities with descriptive alt tags.

Accommodation Options

  • H1 Tag: "Our Accommodation Options".
  • Room Types: Describe each room type, including amenities, prices, and suitable for (e.g., couples, families).
  • CTA: Direct links to book specific room types.

Attractions

  • H1 Tag: "Local Attractions Near [Motel Name]".
  • Content: Provide information on local attractions, distance from the motel, and why they're worth visiting.
  • Images: Include images of attractions with alt tags describing them.
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Note: Something you may not know, is that we also build websites. Many of our customers have Seekom built, fully managed websites which we maintain, including SEO management. If you’re interested in finding out more about this, get in touch.

Example:

Home Page:

  • H1: Welcome to [Motel Name], Your Home Away from Home in [Location]
  • Introduction: Discover the perfect blend of comfort and convenience at [Motel Name]. Nestled in the heart of [Location], our motel offers affordable accommodation with easy access to the city's must-see attractions.
  • Facilities (H2): From our refreshing outdoor pool to free Wi-Fi, we've got everything you need for a relaxing stay.
  • About Us (H2): Learn more about our family-run motel and our commitment to providing exceptional service.
    • Tips:

      • Consistency: Keep your tone and style consistent across all pages.
      • SEO: Use keywords naturally and focus on creating content that adds value to your readers.
      • Updates: Regularly update your content to keep it fresh and relevant.

This template serves as a guideline. Customise the content to match the unique aspects of your motel and local area, making sure to highlight what sets you apart from competitors.

Home Page Example:

H1: Welcome to Sunshine Motel: Your Relaxing Retreat in Miami Beach

Introduction: Step into the warmth and charm of Sunshine Motel, your go-to haven in Miami Beach. Offering cozy rooms, top-notch amenities, and a prime location just steps from the sandy shores, we promise an unforgettable stay at unbeatable value.

About Us (H2): Family-owned since 1998, Sunshine Motel prides itself on creating a welcoming atmosphere where every guest feels at home. Our dedicated staff goes above and beyond to ensure your stay is comfortable and memorable.

Why This Works: The home page immediately highlights the motel's unique selling points (USPs) - location, value, and personal touch. This not only improves SEO by incorporating relevant keywords but also engages potential guests by addressing their primary needs: comfort, convenience, and experience.

Booking Page Example:

H1: Secure Your Stay at Sunshine Motel

Instructions: Choose your dates, select your room, and complete your booking in just a few clicks. Enjoy flexible cancellation policies and the best rates when you book directly with us.

CTA: Book Now - Start Your Beach Getaway Today

Why This Works: A straightforward booking process reduces friction, making guests more likely to complete their reservations. The clear CTA stands out, encouraging immediate action. Highlighting benefits like flexible cancellation policies and best rates addresses common booking concerns, increasing conversions.

Contact Us Example:

H1: Get in Touch with Sunshine Motel

Content: Have questions? We're here to help! Call us at [Phone Number], email [Email Address], or fill out our online contact form. We look forward to making your Miami Beach visit exceptional.

Map: A Google Map pinpoints the motel's location, showing proximity to major attractions.

Why This Works: Providing multiple contact methods caters to different preferences, ensuring potential guests can easily get in touch. The map boosts local SEO and helps travellers gauge the motel's location, reinforcing the decision to book.

Facilities Example:

H1: Discover Our Amenities at Sunshine Motel

Description: Dive into our crystal-clear outdoor pool, stay connected with free high-speed Wi-Fi, and start your day with complimentary breakfast. At Sunshine Motel, every detail is designed for your comfort.

Why This Works: Detailed descriptions and high-quality images of facilities can sway potential guests' decisions. By focusing on amenities that matter most to travellers (like free Wi-Fi and breakfast), motels can stand out from the competition, improving the likelihood of bookings.

Accommodation Options Example:

H1: Choose Your Perfect Room at Sunshine Motel

Room Types: Whether you're visiting solo, as a couple, or with family, we have the ideal room for you. Our King Suite offers luxury and space, while the Double Queen Room is perfect for families. All rooms feature modern amenities and comfortable bedding.

Why This Works: Clear, descriptive information about room types allows guests to easily find a room that meets their needs, making them more likely to book. Including keywords related to room types and amenities also enhances the page's SEO, attracting more organic search traffic.

Accommodation Options Example:

H1: Choose Your Perfect Room at Sunshine Motel

Room Types: Whether you're visiting solo, as a couple, or with family, we have the ideal room for you. Our King Suite offers luxury and space, while the Double Queen Room is perfect for families. All rooms feature modern amenities and comfortable bedding.

Why This Works: Clear, descriptive information about room types allows guests to easily find a room that meets their needs, making them more likely to book. Including keywords related to room types and amenities also enhances the page's SEO, attracting more organic search traffic.

Attractions Page Example:

H1: Explore Miami Beach Attractions Near Sunshine Motel

Content: From the vibrant art deco district to the tranquil Botanical Gardens, Miami Beach is bursting with attractions. Enjoy easy access from Sunshine Motel to everything this dynamic city has to offer.

Why This Works: Showcasing local attractions not only provides value to potential guests but also improves local SEO by including relevant, location-based keywords. This can attract visitors looking for accommodations near specific attractions, increasing bookings.

Impact on Visitors and Bookings:

  • Enhanced SEO: By incorporating targeted keywords and providing valuable, engaging content, these strategies improve the motel's visibility on search engines, attracting more organic traffic.
  • Improved User Experience: Clear, informative content and easy navigation enhance the user experience, reducing bounce rates and encouraging visitors to explore the site further.
  • Increased Conversions: Direct CTAs and streamlined booking processes reduce barriers to booking, leading to higher conversion rates.
  • Builds Trust: Providing detailed information about the motel, from accommodations to local attractions, builds trust with potential guests, making them more likely to book.

Implementing these content strategies not only attracts more visitors through better search engine rankings but also converts more of those visitors into bookings by addressing their needs and making it easy for them to take the next step.