Online bookings have grown beyond the traditional distribution channels like OTAs & GDSs with a consistently increasing influence of social media, e-commerce sites and private sales channels. Breaking the monopoly of OTAs, these platforms have emerged as a profitable option helping hotels maximize revenue. While there is a level of uncertainty amongst hoteliers to use these sites for tactical inventory disposal, it is also true that a lot of these arguments stem from a lack of foresight hampering business to flourish all year long. Amidst this scenario, the role of a revenue manager is constantly evolving. A sharp analyst will start exploring new areas/channels and establish closer relationships with strategic partners. It is important to bear in mind that no economic situation is permanent so a revenue manager should review and install strategies that will hold good in the long term. A short sighted outlook will only help you in the current scenario but less likely to prove helpful in a changing scenario. The way your hotel is positioned now, will greatly affect how your hotel comes through a period from cautious to optimistic market outlook. A well thought out strategy is not about constantly changing direction; it is about setting your hotel up for the future with a range of longer term objectives. Be it guest satisfaction, your own standards or prices, the best wholesome strategy is to make your hotel the leader in revenue optimization. Close relationships with a hotels distribution partners should be an aim of revenue managers at any time, these closer relationships can go a long way to driving volume, if revenue managers approach this opportunity cautiously. Focus should be on establishing a Win-Win situation that protects your inventory and pricing integrity. Poor pricing has a lot of dangerous consequences but the biggest of them all is bloodbath in the market. This helps no one apart from a discount seeking customer and ironically, in many cases, the same customer would have happily paid more instead of availing of an existing discounted rate since it's available. Reacting to market pressure by slashing prices may provide some short term benefits, but it could pull down the entire market to lower ADR levels which take significant time to even come up to the previous price points. This is where responsible discounting comes in and a partnership with a private site helps you in building base business in your tertiary booking window without impacting your transient or negotiated segments. However when working with Private sites the hotelier must be careful about the following:
For OTAs: The option of offering Opaque pricing can come closest to competing on the same turf. It is important to speak to your valuable partners to make sure that the Mystery hotel or Hotel Roulette (As some opaque products are termed) deals are different from private sites in the content and value offering. It doesn't have to mean better or flashy but just try to make it sound different to serve its purpose.
There is no denying the fact that these new sites definitely have emerged as an interesting option in online distribution. However, in order to combat a few uncertainties that have prevented hotels from expanding their revenue and client base, hoteliers must choose the right private site while conducting a thorough analysis of their demographics in order to ensure brand integrity.
In addition, a certain level of foresight is expected from hoteliers wherein they target or not, a new segment which is unable to afford the product today. Nevertheless, hoteliers should adapt their pricing and distribution strategy that certainly incorporates a thorough feasibility evaluation around these sites besides the traditional OTAs and GDSs.
Here is the list of some of the major popular private/flash sales sites:
For a comprehensive list of popular ones, click here.
RateGain Travel Technologies Limited is a global provider of AI-powered SaaS solutions for travel and hospitality that works with 3,200+ customers and 700+ partners in 100+ countries helping them accelerate revenue generation through acquisition, retention, and wallet share expansion. RateGain today is one of the world's largest processors of electronic transactions, price points, and travel intent data helping revenue management, distribution and marketing teams across hotels, airlines, meta-search companies, package providers, car rentals, travel management companies, cruises and ferries drive better outcomes for their business. Founded in 2004 and headquartered in India, today RateGain works with 26 of the Top 30 Hotel Chains, 25 of the Top 30 Online Travel Agents, 3 of the Top 4 Airlines, and all the top car rentals, including 16 Global Fortune 500 companies in unlocking new revenue every day. For more information, please visit www.rategain.com.
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