There is a delicate balance between offering your guests value for money accommodation and maintaining a secure bottom line to ensure you make a profit. Proactive room pricing adjustments are essential to remain in line with seasonal trends. Here are some things to consider when navigating hotel pricing and room rate optimisation.
Added value
To achieve as much revenue as possible out of each individual room booking you take, it is necessary to move away from a “set and forget” mentality for your room rates and move towards adjusting your rates according to seasonal trends. One effective way to shift this mind set is to consider the value of each room and how it alters throughout the calendar year, even though the amenities on offer have not changed. You may find guests are willing to pay more than your usual flat rate during the holiday period as a treat for themselves and their family. Additionally, staying in a hotel or bed and breakfast can afford the opportunity to visit out of area family and friends whilst maintaining freedoms and avoiding logistical difficulties staying overnight at relative’s houses can bring.
Value-added pricing
One pricing strategy is to set your room rates higher around the Christmas season, but offer special added extras. For example, if you have experienced additional family bookings at this time of the year, offering exclusive family packages such as your typical weekend rate on a weekday with free breakfast are worth considering.
Luring guests with lower rates
An empty room is a missed money opportunity. If you are not taking bookings as forecast at the prices you set originally, you many need to make further amendments such as offering special deals. For example, if you usually benefit from an increase in corporate guests over the holiday period, you may wish to offer a business package. Once your rooms are full, you have the potential to acquire more revenue via other services you have on offer.
Length of stay
If demand outweighs supply, you can employ a minimum number of nights that the person must stay in order to book. This restriction can improve occupancy ratios on the days where demand may be reduced and can avoid last-minute one-night stays. It may be useful for you to consider that Christmas Day and New Year’s Day fall on a Saturday this year, which may affect which days are more or less popular before people return to work.
Using an “ascending model”
It can be advisable to use an ascending pricing structure, whereby you forecast your demand and set prices to encourage visitors to book early, then increase rates closer to Christmas as demand increases.
Some further pricing considerations
- Will you employ Daily Pricing or Length of Stay pricing? Which option best suits your business and your guests?
- What are your competitors offering and are your rates equal, superior, or inferior in relation to room size, location, services offered etc.?
- When will your local festive events be held? Monitor local events such as Christmas markets and New Year’s parties, and advertise special deals to encourage guests to stay overnight
Of course, keeping up to speed with local competitors, local events and making your guest’s Christmas/New Year experience one they will want to revisit next festive season takes a lot of time and energy. This is where Guestroom Genie can help! Guestroom Genie is an affordable Property Management and Reservation System, designed to simplify administration tasks saving you time and money. Guestroom Genie has easy to use features, including setting and changing your room rates, whilst our Booking Engine cuts the amount of profit you share with third-party mediators. We are so confident in our product, that we offer a FREE, no obligation trial!
Why not give us a try today? Visit guestroomgenie.com and see for yourself! For more information, please contact our friendly team a call on 0114 207 0221. We’re standing by to grant your wishes this Christmas.
