Hotels explore new strategies to enhance guest acquisition amidst increasing competition
After analyzing over 50 million room nights across more than 2,000 international hotels that are currently using one or multiple Allora products and services, SHR’s Hotel Industry Trends Report 2024 reveals a turning point for the hotel industry. This insightful report exposes for the first time the way the recent influx of marketing spend from OTAs is impacting hotels’ share of direct bookings, and discusses the marketing strategies needed to respond.
Some key insights in the report:
Understand recent shifts in the dynamics of direct bookings
Impact of Cost-Per-Click inflation on hotelier’s digital marketing strategies
Trends in the evolution of booking channel mix
How AI-powered technology solutions can help hoteliers maintain competitiveness.
Welcome to the forefront of hospitality innovation. SHR is proud to present our latest whitepaper, The Importance of a Deep, Native Integration Between Your CRS & CRM. This ground breaking resource delves into the transformative potential of deep, native integration for hotels worldwide.
Why Deep, Native Integration Matters:
Enhanced Efficiency: Discover how seamless data flow between your CRS and CRM streamlines operations, saving time and resources for your hotel.
Improved Data Accuracy: Say goodbye to discrepancies and errors with a cohesive system that ensures accuracy across all your platforms.
Seamless Guest Experience: Elevate guest satisfaction with personalized interactions made possible by a fully integrated CRS and CRM.
What You’ll Learn:
Understanding Deep, Native Integration: Explore the concept in depth and learn why it’s crucial for modern hotel management.
Comparative Analysis: See how deep, native integration stacks up against typical API-based connections and why it’s the superior choice for your hotel.
Real-world Success Stories: Hear from hotels around the globe that have embraced deep, native integration and experienced tangible benefits.
Ready to Elevate Your Hotel’s Performance?
Don’t miss out on this opportunity to revolutionize your hotel’s operations and guest experience. Download our whitepaper now and discover the power of seamless integration with SHR.
In the past, SHR Group placed the Central Reservation System (CRS) at the core of the distribution process. However, our vision has evolved, and we now position the guest at the heart of the system.
Empowering independent hotels and regional brands, our comprehensive product suite, featuring the Internet Booking Engine (IBE) and Customer Relationship Management (CRM), is strategically designed to boost revenue and cultivate lasting guest relationships throughout the entire guest journey.
Crucially, our Central Reservation System (CRS) acts as the linchpin, seamlessly connecting hotels or brands to all their booking channels. This global reach spans both direct and indirect channels, ensuring visibility where potential guests make their purchasing decisions. By being present and bookable in diverse channels, languages, and preferred platforms, the CRS not only broadens its reach but also capitalizes on revenue-generating opportunities.
Furthermore, all pricing and selling strategies are conveniently managed within the CRS, streamlining operations and providing a unified approach. Our mission remains steadfast—to establish enduring connections between hotels or brands and their guests, prioritizing meaningful relationships over short-term gains, while strategically positioning them to reach a global audience and meet guests where they are.
Our pioneering approach, centered on deeply integrated, cloud-based software, built with an API-first approach, delivers scalable, brand-centric guest experiences tailored and customized to support each hotel’s unique context and strategy and our CRS tool is designed to connect the hotel to their guests in a more intuitive way, alongside our IBE, CRM and RMS.
Beyond the Realm of Open Pricing – The Importance of Using a CRS
Relying solely on a channel manager raises critical considerations, primarily concerning the relationship between the channel manager and OTAs. OTAs, by their inherent nature, predominantly focus on the open-priced leisure market, utilizing a date/rate/occupancy model for essential data. This approach can provide a limited perspective on the complete distribution and booking landscape, neglecting segments like business and group/event travelers.
In this constrained scenario, you might find yourself disregarding tactics related to loyalty or length-of-stay pricing, as opposed to simple open pricing. Remember the intricate distribution strategies mentioned earlier? They encompass various methods, such as blended rates, derivation, double derivation, sell limits, loyalty rates, and more, all aimed at reaching your guests and increasing online and offline bookings.
Modern CRS systems go beyond the linear model of solely connecting to OTAs, enabling the creation of finely tuned strategies and booking concepts. Guest-centric strategies demand control from the hotelier, which can be achieved by connecting to the myriad choices and strategies offered by today’s guest-focused CRS model, rather than solely relying on the standard channel manager model.
Channel Manager vs. Central Reservation System (CRS): Understanding the Differences
In the world of hotel management and distribution technology, two critical tools play a central role: the Channel Manager and the Central Reservation System (CRS). While both serve to streamline the process of distributing hotel rooms across various channels, they have distinct functionalities and purposes. Let’s delve into the differences between a Channel Manager and a CRS to understand how each contributes to an effective hotel distribution strategy.
Functionality & Scope of Control:
Channel Manager: A Channel Manager primarily focuses on managing and updating room rates and availability across multiple external online channels, such as OTAs (Online Travel Agencies), global distribution systems (GDS), as well as the hotel’s own website. It ensures that room inventory is synchronized in real-time, preventing overbookings or double bookings and hotels can efficiently manage their presence on multiple third-party websites.
CRS: A Central Reservation System encompasses all the functions of a Channel Manager and more as it serves as the core system for a broad range of functions including managing a hotel’s room inventory, reservations, direct bookings on the hotel’s website and guest data. It often includes features like a booking engine (IBE), reservation management, and guest profiles. The CRS serves as the centralized master hub for all aspects of reservations deploying the hotel’s selling strategy, supporting direct bookings through the hotel’s website and call center, in addition to handling third-party distribution.
Data Management:
Channel Manager: Channel Managers handle rate and availability data, ensuring consistency and accuracy across various online platforms. They typically do not manage guest data or handle guest profiles.
CRS: A Central Reservation System is responsible for all transactional communications to do with managing guest profiles, preferences, and reservation data. When integrated with a CRM all this valuable guest contact and purchase information can be used for personalized marketing strategies.
Direct vs. Indirect Bookings:
Channel Manager: Channel Managers are primarily geared towards managing indirect bookings through third-party channels and OTAs.
CRS: A CRS has a higher level of direct connectivity as it encompasses both direct and indirect bookings, managing reservations made through the hotel’s website and external channels, such as GDS systems.
In summary, a Channel Manager and a Central Reservation System serve distinct but complementary roles in a hotel’s distribution strategy. While a Channel Manager excels at managing rates and availability across external channels, a CRS acts as the central hub for managing all aspects of hotel reservations, including both direct and indirect bookings, guest data, and the hotel’s own website bookings. To maximize efficiency and revenue, many hotels use both systems in tandem to achieve a balanced and effective distribution strategy.
The strength of SHR Group’s Central Reservation System (CRS) lies in its ability to efficiently deploy strategic pricing to the various segments of the market, meeting guests where they are and on their preferred booking channel. It streamlines the reservation process and optimizes the hotel’s operations and revenue management strategies, all while enhancing guest experiences and catering to the specific needs of each client. This tailored system ensures that every step of the reservation journey is smooth and efficient, from the moment a guest makes a booking to their departure.
The CRS takes care of all the necessary tasks, from availability checks to sending confirmation emails. Hoteliers can easily manage and organize reservations, view real-time availability, and make updates with just a few clicks, thereby increasing operational efficiency. Moreover, the system boosts global reach through integration with the Global Distribution System (GDS), major Online Travel Agencies (OTAs), and multiple channel managers, leading to increased visibility and more bookings. This automation not only saves time but also reduces the risk of errors, allowing hotel staff to focus on providing exceptional guest service.
However, the strength of SHR Group’s CRS goes beyond operational efficiency. This user-centric reservation management system offers more than basic hotel CRS functionality. It empowers hoteliers to reach every one of their guests and is designed to work with all the other SHR tools such as CRM and RMS to personalize guest preferences, track guest history, and gather valuable insights to deliver truly personalized guest experiences. This level of personalization not only enhances guest satisfaction but also fosters guest loyalty and repeat business, making it a valuable asset for hoteliers looking to excel in the competitive hospitality industry.
Successful hotel distribution strategies today require a holistic approach that encompasses each facet of the booking journey. In the coming months, hoteliers will be laser focused on optimizing their channel mix for profitability, personalizing the booking experience to increase conversion, and leaning on Artificial Intelligence to drive efficiencies.
To operate a successful hotel, there are a lot of things that have to go right. Owners need the right building in the right market tailored for the right demand generators, and operators need to build a top-notch management team equipped to offer great service. Perhaps most importantly, though, is a well-thought out strategy to attract guests. Even the perfect hotel will not stay open long with no guests. Gone are the days when hotels could simply open their doors next to a tourist destination and expect to fill up. As more and more hotels pop up in a market, hotels are constantly pressed to find ways to differentiate. Simultaneously, the ways travelers are searching and booking accommodations has evolved drastically, and hotels are constantly updating their strategies to ensure their offerings are in front of as many potential guests as possible. Hotel distribution today involves a holistic approach to inventory management, digital marketing and pricing, with all teams across the commercial department acting in synchrony to ensure room availability and rates are appearing in the right places. To stay ahead of an increasingly complex landscape, hoteliers are turning to modern and innovative technology as an essential component of their distribution strategies.
First, hotels must remain focused on optimizing their channel mix, which means analyzing which channels are the most profitable for them and driving as much business through these channels as possible. Ancillary channels can and should be used to fill in need periods or to reach travelers the hotel otherwise might not reach through its own channels.
Next, it’s increasingly imperative for hoteliers to personalize a traveler’s booking experience, which can mean anything from using a first name in an email to presenting only offers that are relevant to that guest, based on previously identified preferences.
To enable these and other modern distribution strategies at scale, hoteliers are increasingly relying on Artificial Intelligence. While the industry has long relied on machines for their ability to aggregate and normalize large sets of guest and transactional data, we are at the beginning stages of AI actually putting this data into action. Today, AI is helping reduce manual work across hotel distribution, from generating rate packages and descriptions to knowledgable chatbots equipped to handle any guest inquiry.
Allora.ai creates a personalized booking experience for every guest, which drives engagement and unparalleled guest conversion and is supported by digital marketing with outstanding website design.
2022 Cancellation Rate Trends: How can you maintain guest retention
Without a doubt, one of the most challenging things about running a hotel is the tendency for guests to make a reservation but then frustratingly cancel at the last minute.
Given the current climate we are all facing, there are multiple reasons why travellers and guests are cancelling their bookings and deciding to drop-out of their plans at the last minute. As rates rise year on year, forecasting and pricing decisions for hoteliers will continue to be undermined which magnifies inefficiencies, increases costs, and damages margins.
In 2019, we found that the share of direct booking revenue lost due to cancellations had jumped to 15%. Now in 2022, our latest research reveals this figure has skyrocketed with 20% of bookings cancelling – a 33% increase over 2019 for the same period.
So what can hoteliers do? Below, we delve into the state of cancellations in 2022, the patterns that hoteliers need to be aware of, and the tools that can help businesses deliver a proactive booking retention game plan.
Learn how vital hotel systems can be interlinked to improve operations, better connect with guests, and provide real loyalty rewards that move the needle on maximizing revenue.
The hotel industry may be welcoming more guests now than pre-pandemic times, but resource limitations and the uncertainty about the trends that will impact the industry going forward remain top of mind. Fortunately, advancements in automation and guest recognition technology have made it easier than ever for hoteliers with less staff to manage operations while exceeding guest expectations.
Hotels are challenged with finding the right technology solution that will help them to improve the guest experience. Hoteliers must consider the capabilities of the technology they are investing in and their partners’ capacity to provide support as well as find new ways to improve their platform over time. Understanding how this technology fits into the working system and the ways in which it can continue to improve process, is really important in alleviating the ‘technology burden’ and allowing hoteliers to focus on what’s important to them; their guests.
In this report, you’ll learn :
How automation is helping hoteliers to save time and increase efficiently
What questions to ask to properly automate your hotel’s operations
How hotel recognize guests in ways that reward loyalty
The ways hotel loyalty programs have evolved
Why traditional loyalty programs are no longer a necessity today
Learn how to improve guest satisfaction at each touchpoint – from booking to on-property to post-stay follow-up – while maximizing revenue every step of the way.
As the hotel industry emerges from the COVID pandemic, it’s clear that the desire for travel has not diminished these past two years; in fact, it appears to be as strong as ever. But while demand may be back, your guests’ wants, needs and demands have changed, and so should your offerings. Guest expectations have never been greater, and the owners and operators who evolve their offerings to meet and exceed them will stand out amongst the crowd.
Hospitality commercial teams have expanded their strategies to examine and improve all aspects of the guest journey, from the dreaming and research phases, through the booking phase and on-property experience, all the way through post-stay follow-up. At each touchpoint you have with the guest along their journey, there are opportunities to “wow” the guest as well as drive more revenue through upsell programs and personalized offers. With the right digital tools in place, hotel commercial teams can maximize revenue per guest – not by constantly pushing offers the guest is not interested in, but by anticipating their needs and providing a memorable experience that ensures the guest will return.
In this report, you’ll learn:
• How to adapt to changing guest travel and booking behaviors
• Why you need to tailor the booking experience
• Key ways to drive direct bookings in today’s changing world
• How to create a well-rounded distribution strategy
• Why the employee experience directly affects the guest experience
• How to personalize the guest experience at all stages of the journey
• Why automation is key to the employee and guest experience
• Why guest loyalty is changing and how you can adapt
The essentials of managing casino customer demand to optimize profit.
By Sue Murphy CRME, ComOps
Introduction
Casino hotels comprise only a tiny fraction of hundreds of thousands of hotels across the world. Perhaps due to this limited scope, the industry lacks universal performance metrics, and casino customers might find frustratingly varied booking experiences across different brands. The ongoing legalization of gambling-related activities, however, has fueled growth in the commercial and tribal casino industry over the past few decades. With casinos now in almost every state in the US, knowledge about gambling operations, loyalty programs, and marketing tactics is increasingly prevalent. Gaming operators have long expanded into other hospitality industries and, recently, online. Resort casino properties often host a vast array of offerings, including gourmet restaurants, spas, golf courses, and of course, hotels. About 30 percent of almost one thousand casinos across the US have a hotel on site. In most cases, the hotel is viewed as an amenity to the casino and not the other way around.
How do ownership groups and leadership teams ensure they get the most out of each room and measure success accordingly? What does casino segmentation look like compared to customary market segments, and how can casino hoteliers ensure they provide the best experiences to their most valuable customers? This paper aims to address some of these questions, explicitly targeted at the revenue management of casino hotel properties.
Since its inception in the airline industry more than 50 years ago, revenue management has been applied across various industries and sectors. Already widely implemented to optimize airplane seat and hotel guest room revenue, revenue management has expanded into other profit centers, including cruises, convention space, restaurants, spas, golf courses, entertainment venues, and car rentals. The discipline has also extended outside travel and leisure to short-term housing rentals, storage units, and even hospital beds, to name some. Businesses of all leanings benefit from maximizing revenue and profit from perishable inventory. For many hotels and resorts, ancillary non-room spend can be well over 50 percent of total revenues. This is probably most true for casino hotels, where the vast majority of property income is generated on the gaming floor.
It should come as no surprise to learn that casino hotel management companies were especially keen to adopt and implement the practice of revenue management and apply it to their casino guests. Yet while the ability to yield gaming revenue from casino segments is among the more crucial components of maximizing hotel worth in a casino environment, it is perhaps the least well-understood. Successful revenue management in a casino hotel requires in-depth knowledge of the gaming customer and an ability to measure projected guest worth. Revenue optimization also requires that all hotel demand is yielded. This means casino guest reservations are booked based on customer worth without preset offers or ‘guaranteed’ rates. The combination of understanding guest worth and yielding all demand allows for optimal revenue and profit.
Casino customer valuation and segmentation
Segmentation
Segmentation is a critical component of any successful hotel revenue optimization strategy. In casino hotels, the worth breakout for gaming guests is essential, but it is also necessary to understand the non-casino business mix. Increasingly, casino hotel properties analyze their hotel business on two levels—one for traditional market segments and the other for specific casino segments. The main difference between the conventional market segments in casino vs. non is the need to include ‘casino’ as a source of business. For financial purposes, hotel leadership must ensure the casino source is further broken down into “cash” room nights and “free” or “comp” room nights, as demonstrated in the example provided.
Valuation
The casino segments, as defined above, work for financial reporting and budgeting but are insufficient for yielding purposes; hotel leadership has to collaborate with marketing to build out additional breakdowns based on projected customer worth. The guest’s worth segment dictates whether they will receive a discounted cash rate, a comp offer, or a combination of both.
Casino customer valuation requires a data warehouse with detailed revenue tracking at the individual guest level. Fortunately, a player database is the foundation of most casino loyalty and marketing programs. Casino customers are heavily incented to use a loyalty club or a “players card” to reap rewards such as free slot play, complimentary dining, and room nights. For chains or multi-property entities, a universal database is a best practice, encouraging loyalty to the brand and enhancing the customer relationship. The loyalty database will include various levels or tiers ranging from brand new customers to the most loyal ‘VIP’ guest. A customer’s tier level is based on their cumulative worth, derived from slot and table play, but increasingly RM teams are incorporating non-gaming ancillary spend (cash spend for hotels, F&B, etc.), and casino management companies are starting to integrate sports betting and online gaming with the recent advent of both in several markets.
While cumulative worth or loyalty can be a factor in the hotel valuation, from a hotel revenue standpoint, it is necessary to understand a customer’s projected worth for each night of their stay. The customer valuation is usually an in-depth formula incorporating trip and play history to devise an average nightly estimate of a guest’s potential future worth. This estimated worth (or profit) value, along with the forecasted demand, dictates the price quoted to that
guest. More precisely, the value determines the customer’s segment and dictates pricing at the segment level. A hotel gaming enterprise can decide which segment breaks are best suited to their business, just as they will want to customize the customer valuation for their needs. A smaller property, for example, may have fewer segments but more breaks at the higher worth end of the database. Certain hotels in high frequency markets may ignore non-hotel trips in the valuation as it would be less predictive of their play behavior during their stay. More info in: “The Revenue Director & Casino Customer Valuation” by Matt Flemming, https://www.comops.com/our-insights.
