On Air with RMS: Stories from the Hospitality Cloud Episode Two featured Marvin Speh, Co-Founder of RoomPriceGenie and Matthew Galbraith, Directior of Operations at RMS as they took a deep dive into Revenue Management trends in the park industry.
Revenue management is becoming a game-changer for parks and campgrounds, with more and more owners and operators implementing revenue management tools at their properties.
A revenue management system allows you to carry out important revenue management tasks more efficiently and effectively. It will make use of data from your own property, and from the market at large, in order to help you to make more informed decisions. It is able to use the data and its own algorithms to carry out a real-time analysis based on demand and the market, in order to calculate ideal rates.
A lot of business owners can get overwhelmed at the idea of implementing an entirely new revenue management system but there are some ways that parks can easily improve their pricing structures with revenue management and other pricing tools. In the session Matthew discussed this analogy of "good, better, best" when thinking of different ways to price your nightly rates. Watch the 5 minute clip of him explaining that here.
Then, take a look at the descriptions below and determine which category you fall in and how you can get to the next threshold.
Currently: Variable pricing
A variable pricing strategy is a pricing method in which the price of your sites may vary based on day of the week, holidays or other factors. For example, you might increase your nightly rate on Fourth of July weekend because you know you will sell out. Another example is you decreasing your nightly rate during the weekdays when you are slow to get more traffic.
However, all of these pricing changes are made manually and without any business intelligence software guiding your decisions. This is a good place to start because you are thinking critically about how to maximize on your nightly rates.
How to get to better: Begin using a dynamic pricing feature in your reservation manangemnet system or implement a revenue management system.
Currently: Dynamic Pricing
Dynamic Pricing is your secret weapon to maximize profit and occupancy throughout the year. Instead of sticking with flat rates, dynamic pricing allows you to create pricing rules based on predetermined occupancy levels that automatically adjust rates depending on slow or busy periods. For example, you may want to increase your nightly rate by $15 when you're at 80% occupancy. Or, when you are only at 15% occupancy you may want to decrease your nightly rate by $5.
Without lifting a finger, you can increase revenue during high demand and attract guests with lower rates during the off season.
How to get to best: When using dynamic pricing, you do not know if people are booking more on particular dates, whereas a revenue management will automatically take both your occupancy levels, as well as the occupancy levels of the market around you and adjust pricing dependent on that.
Congrats! You have a fully automated Revenue Management System Implemented!
With a fully automated revenue management system, you are set up for success to reach your property's highest revenue potential. With the industry constantly evolving it is important to ensure you have the best revenue management system that fits your businesses needs. Be sure that your current system allows for you to grow as your business goals and needs change.
About RoomPriceGenie: RoomPriceGenie is an automated revenue management system designed for all types of accommodation providers - for every space where someone can sleep, they will know the right price. With their work on Revenue Management in smaller RV parks and campgrounds, they are opening up a new opportunity to increase revenue in this sector.
Contact Marvin Speh for more information: [email protected]
About RMS North America: RMS offers an innovative cloud-based reservation management system that empowers parks and campgrounds to increase operational efficiencies and achieve their business strategy in any market conditions.
Contact Matthew Galbraith for more information: [email protected]