The novel coronavirus has brought the whole travel and hospitality industry to a standstill. However, slowly and steadily, the industry has been noticing some collaborative and collective efforts towards recovery. Although the full-strength recovery is expected in months from now.
When this happens then the new norm of revenue management will be radically different from what we treat as bible today. Now the primary focus of the revenue managers will be to generate revenue from scratch. To give you more clarity and a path to follow, RateGain a travel technology company came out with a two part research to help the hotel and travel industry, they have been closely monitoring the unprecedented developments of the COVID-19 coronavirus pandemic and its impact.
According to the insights given, some of the strategies you can follow are-
Maintaining the Cash Flow: You can never go wrong with Cash Flow, it is the undisputed king. At this point, you will have to think creatively about how you can attract revenue from various channels. This is a tried and tested way of increasing the liquidity, and it will help fund operations until the demand increases. Many hotels should try out this method of raising money. Another example, look at the independent hotels in Thailand. Something that has turned out great for them, they have started selling vouchers for future bookings with extended expiry dates.
Another thing you can do is come up with a new hotel pricing strategy , the point being, never stop exploring your options.
Collaborate with the Government, Industry Bodies, & Your Peers: The leadership need to collaborate with industry associations in order to create and submit proposals to the government - addressing the issues in hand.
For instance, various hotels and OTAs in India are pairing up with the Internet and Mobile Association of India (IAMAI) to submit proposals and recommendations to help ease taxes amongst other things.
Utilizing Learnings from the Past: Although you are aware of the fact that there is no historical precedent of COVID-19, however previous pandemics can help you figure out what to expect and likely consequences.
The hospitality industry has gone through such crises in the past as well and came out stronger than ever. Keeping the current situation in mind, doing an analysis of the historical decline in the number of tourists could be used as a reference point in order to figure out what the future holds for us from a macro-perspective.
Similarly, the gradual uptick can be looked as the reference point of recovery. Besides, humans are immensely adaptive, and the previous recoveries after disasters are the testament to the fact that scars heal quickly. While there would be habitual changes, people will start travelling soon, and revenue managers will have a market to cater to.
Focus on Direct Bookings: Although OTAs are a significant source of revenue in normal circumstances, hotels need to find different ways to increase direct booking for faster revenue recovery.
For instance, maintaining ‘rate parity’ is one of the ways that you can increase direct booking. With RateGain’s PARITY+, a hospitality technology software, you can increase direct bookings by reducing disparities and rate leakage. The platform provides you with the freedom to identify and manage disparities across all the channels over a selection of dates and ensure your rates are displaying correctly to your customer.
These were four revenue strategies that you can abide by, and as COVID-19 continues to take its toll on the global hospitality and travel community, we urge you to maintain a rational focus over your revenue management and business operation. Despite the current uncertainty, the future of the industry is bright and better, and healthier days lie ahead. For more information regarding how to tackle this pandemic, visit RateGain’s portal for a better tomorrow, an initiative taken by the travel technology company to help businesses of all sizes operating in the hospitality industry to survive and come out of this stronger than ever.