Participation of Rate Tiger at the Associação Portuguesa de Hotelaria Seminar "Hotel Distribution"

1. “Making the most of IDS as part of your Revenue
Management strategy”
Seminário Associação da Hotelaria de Portugal
30 Junho 2010 | IPAM LISBOA
Pilar Sánchez Aita, RateTiger

2. Brief History of e-Commerce
< 1990 1990-1997 1998-2002 2003-2006 2007-2008
WWW, NEXUS,
Web Internet More browsers
Mozilla
Archie, Gopher, Yahoo search,
Google, Baidu
Search Engines Lycos, Altavista, MSN Search,
more
Inktomi, Ask Jeeves Info.com, more
MORE PRODUCT
Travelweb (PEGS), Expedia,,
WorldRes, Bookings,
Online Travel Explosion of websites
Travelocity, many more
Hotelbook (PEGS)
Holidaycheck, Explosion
Web 2.0 - Reviews Tripadvisor
trivago and more (including OTA)
Kayak, Sidestep, Explosion -
Meta-Search Engines TOGOL, Mobissimo specialized
and more (e.g. trivago)
Web 2.0 - Social
Facebook, MySpace,
Communities Explosion
YouTube, WAYN
Web-sharing
FASTEN
www.ratetiger.com

3. The evolution of the Internet has enormous
impact on Revenue Management Strategy
What do we know?
 We know the internet is becoming more and more powerful and more of a
necessity, rather than a luxury in our everyday lives.
 We know that hoteliers are learning to use more Revenue Management
(Yield Management) strategies.
What is Revenue Management
“ … Revenue Management is the process of understanding, anticipating and
reacting to consumer behavior in order to maximize revenue or profits… “
(Wikipedia, April 2008)
Not simply the art of being the cheapest!
www.ratetiger.com

4. “How Internet Distribution Systems impact the way
hotels need to view revenue management”
What influences consumer behaviour ?
 Product In hoteliers’ control
 Location A set parameter
 Price In hoteliers’ control
 Availability Driven by the market and the hotelier
 Convenience In hoteliers’ control
 Impression In hoteliers’ control
Conclusion: 5 out of 6 can be influenced by the hotel
www.ratetiger.com

5. “How Internet Distribution Systems impact the way
hotels need to view Revenue Management”
www.ratetiger.com

6. What the Revenue Manager must consider :
 Segmentation of client mix (corporate / leisure /
weekday / weekend / etc.)
 Balance between current occupancy and rates
 Competitiveness of rates and ranking
 Consider consumer benchmarking abilities
 Market conditions (trade shows, events)
 Forecast of future occupancy
 Consumer trends & behaviour
 Competition
www.ratetiger.com

7. Why work with IDSs?
 Greater exposure
 Segregation of inventory
 Lower cost per acquisition compared traditional
 You want their loyal customers
www.ratetiger.com

8. Return on your investment...
 If your Average Room Rate is 100 euros per night..……
 If you decided to update 10 websites ……….
 If through greater exposure, you received just ONE extra room
night per month from each site you work with……..
 100 x 10 x 12 = 12,000 euros per year would be generated.
It’s an easy decision to make !
www.ratetiger.com

9. “To position or not to position…” - Parity versus
maximizing opportunities at producing IDS
Hotels have the choice now...
1. Different rates at different sites
2. Keep your rate parity at all sites
www.ratetiger.com

10. “To position or not to position…” - Parity versus
maximizing opportunities at producing IDS
Parity No Parity
Uniformity at all websites Different rates @ Different sites
No confused clients Clients could be confused
Can optimise rates; different
Can’t optimise rates channels sell differently
- Different countries/incomes
- Different selling power of
channels
No conflicts with travel websites Hotels have more control over
Revenue Management / Strategy
METASEARCH: doesn’t matter for METASEARCH: Transparency to
hotels using rate parity consumers
www.ratetiger.com

11. Recent booking trends and the impact on revenue
management
Booking trend Impact on RM
Growth of online bookings Focus on travel websites
Growing number of travel websites Greater choice of distribution /
product placement
Greater choice of distribution / product More decisions to be made / more
placement updates to be processed
More decisions to be made / more updates More time consuming and more
to be processed confusing
www.ratetiger.com

12. Summary: Right time, right place, right price. Revenue
Management in a world wide web.
Right Time – Consider:
 Market conditions (trade shows, events)
 Level of occupancy
 Consumer trends & behaviour
 Competition
www.ratetiger.com

13. Summary: Right time, right place, right price. Revenue
Management in a world wide web.
Right Place – Research:
 Global vs. national vs. regional extranet?
 Offline vs. online?
 Question: which extranets produce at the Right Time?
www.ratetiger.com

14. Summary: Right time, right place, right price. Revenue
Management in a world wide web.
Right Price – Manage:
 Segmentation of client mix (corporate / leisure /
weekday / weekend / etc.)
 Balance between occupancy and rates
 Competitiveness of rates
 Consider consumer benchmarking abilities
www.ratetiger.com

15. … Ask yourself…
Online
 Where is my business coming from?
 Who are my competitors and how do I compare?
 Which channels do I need to work with?
 What should be my pricing strategy? RT Strategy
 How or how often should I update my distribution
channels?
 How do I monitor results?
www.ratetiger.com

16. Market – Online Distribution Market Overview
Demand Channels
Airline CRS (GDS) Switch Hotel CRS Hotels
Segments of Distribution
TRADITIONAL
Travel Website Sabre Pegasus Chain CRS Chain Franchises
Representation Independent
WorldSpan
Company Properties
Travel Agents
CORPORATE
TRAVEL
Amadeus
Who will help to manage this chaos ?
RT Integration
Galileo
GROUP
CONVENTION
Event Management Hotel/Motel
Companies Groups
RT Integration
Independent
LEISURE
Call Centers I-CRS Hotels
TRAVEL
INTERNET BASED
Resorts
Travel Websites
Inns, B&B’s
www.ratetiger.com

17. eRevMax Inc. / Rate Tiger - Key Facts
WHO ARE WE ?
 RATE TIGER – We build software for hotels (since 2001) that
 Simplifies competitor analysis
 Centrally manages rates and availability
 Automates revenue management
 Products for Hotels, Hotel-Groups / Chains, Hostels and Distribution Channels
www.ratetiger.com

18. RateTiger Product Suite
Helping hoteliers to better manage online revenue and distribution ...
RT Strategy
www.ratetiger.com

19. Products
RT Strategy
 Benchmarking for Hotels / Groups / Travel sites
 Competitor rate information on travel and hotel sites
 Weekly report or online real time (both accessible at any time)
 300 websites connected / 3,000 hotel sites configured
 Several packages available
www.ratetiger.com

20. Products
RT Strategy
 Rate & Inventory Allocation
 Manage multiple travel websites in one
screen
 Optional status quo (Pro version)
 Currently over 250 sites
 Several packages available
www.ratetiger.com

21. Products
RT Strategy
RT Strategy
 Low cost revenue management system
 Based on how hotels determine rates
 Three strategies
 Lowest rate guarantee available for all strategies
 Additional features
www.ratetiger.com

22. … OR very simple …
Without RateTiger With RateTiger
Time consuming process? With RateTiger you will
You can’t add more sites? Confused? Manage More by Managing Less
www.ratetiger.com

23. Top 8 Tips for Effective Revenue Maximization
1. Drop Rates Carefully
2. Do not ignore historical data
3. Invest in technology Expedia
Orbitz
Benchmarking
Channel Partner hrs
Rates &
Inventory
City.com
4. Treat IDSs as your partners
5. Use effective channel partners Country.com
6. Automate allocation process
7. Experiment with different IDSs
8. Always focus on a mutual win, and this in turn will build trust and
loyalty
www.ratetiger.com

24. Obrigado
Thank You
Pilar Sánchez Aita
Tel : +34 91 127 1779
Fax: +34 91 547 7187
E-mail: pilara@ratetiger.com
Web: www.ratetiger.com
www.ratetiger.com