Maximize Revenue with Advanced Hotel Forecasting Techniques Leveraging Hotel Software
As the famous American author, John Steinbeck once said, “What good is the warmth of summer, without the cold of winter to give it sweetness?” The metaphor here is that contrast can make things better. Similarly, when it comes to the hotel industry, forecasting is the winter that can give the summer the sweetness it deserves. But how can you optimize hotel forecasting to make your hotel stand out in a sea of competition? Well, the answer lies in the intelligent use of hotel technology such as web-based hotel PMS.
In this article, we’ll explore the various aspects of hotel forecasting and how technology can help you to optimize it to achieve success. But before we dive in, let’s take a quick look at some statistics.
According to a report by ResearchAndMarkets.com, the global hotel and hospitality management software market size was valued at $5.41 billion in 2020, and it is expected to reach $13.99 billion by 2028. Another report by Grand View Research estimates that the web-based hotel PMS market size will reach $1.24 billion by 2028. These numbers clearly indicate the growing importance of technology in the hotel industry.
Now that we know the importance of technology in the hotel industry, let’s dive into the various aspects of hotel forecasting.
The Current State of Hotel Forecasting
In the past, hotel forecasting was mainly done using spreadsheets and guesswork. But with the advancement of technology, forecasting has become more data-driven and accurate. Today, hotels use various forecasting models to predict their occupancy rates, revenue, and profitability.
Popular Hotel Revenue Forecasting Models
There are mainly three types of hotel revenue forecasting models: operational forecasting, financial forecasting, and revenue management forecasting (unconstrained demand forecast). Operational forecasting uses historical data to predict future performance. Financial forecasting focuses on the financial aspects of a hotel, such as revenue and expenses. Revenue management forecasting takes into account market demand, pricing strategies, and other external factors to predict future revenue.
The Unique Advantages That Revenue Management Forecasting Offers
Revenue management forecasting is the most advanced and sophisticated method of forecasting. It takes into account various factors, such as market demand, pricing strategies, and other external factors, to predict future revenue accurately. By using revenue management forecasting, hotels can optimize their pricing strategies, maximize their revenue, and improve their profitability.
Key Focus Areas for Outstanding Revenue Management Forecasting Success
Now that we know the importance of revenue management forecasting let’s look at the key focus areas that can help hotels achieve outstanding revenue management forecasting success.
Past Performance Data
To accurately predict future performance, hotels need to analyze their past performance data. By looking at their past data, hotels can identify trends and patterns and use them to make informed decisions about their future pricing strategies.
On-the-Book (OTB) Data
On-the-Book (OTB) data refers to the number of bookings that a hotel has already received for a particular period. By analyzing their OTB data, hotels can adjust their pricing strategies to maximize their revenue.
Accurate Future Data
To make accurate predictions, hotels need to have access to accurate future data, such as market trends, holidays, and events. By taking into account these factors, hotels can adjust their pricing strategies and optimize their revenue.
Market trends play a significant role in hotel forecasting. By analyzing market trends, hotels can adjust their pricing strategies to maximize their revenue.
Holidays and Events
Holidays and events can have a significant impact on a hotel’s occupancy rates and revenue. By taking into account upcoming holidays and events, hotels can adjust their pricing strategies to optimize their revenue.
Influence of Competitors
Hotels need to keep a close eye on their competitors and their pricing strategies. By analyzing their competitor’s pricing strategies, hotels can adjust their own pricing to stay competitive and maximize their revenue.
Repeats and Rebookings
Repeat customers and rebookings are essential to a hotel’s success. By analyzing their past bookings, hotels can identify repeat customers and offer them special deals or packages to encourage them to book again in the future.
Other trends, such as changes in the economy or shifts in consumer behavior, can also impact a hotel’s forecasting. By staying up-to-date with these trends and adjusting their pricing strategies accordingly, hotels can stay ahead of the curve and maximize their revenue.
How Hotel Software Can Help
Hotel software, such as web-based hotel PMS, can be a game-changer when it comes to hotel forecasting. It can automate many of the manual processes involved in forecasting and provide real-time data and insights to help hotels make informed decisions.
For example, web-based hotel PMS can provide hotels with real-time data on occupancy rates, room rates, and other key performance indicators. This data can be used to adjust pricing strategies on the fly and optimize revenue.
Hotel software can also provide hotels with advanced forecasting tools that use machine learning and artificial intelligence to predict future performance. These tools can analyze past data, market trends, and other factors to make accurate predictions and provide recommendations on pricing strategies.
In addition, hotel software can streamline many of the manual processes involved in forecasting, such as data entry and analysis. This can free up staff to focus on other areas of the hotel’s operations, such as guest experience and marketing.
In conclusion, hotel forecasting is an essential aspect of hotel operations. By using revenue management forecasting and focusing on key areas such as past performance data, accurate future data, market trends, and competitor pricing, hotels can optimize their pricing strategies and maximize their revenue.
With the help of mycloud hotel software, such as web-based hotel PMS, hotels can take their forecasting to the next level and gain a competitive edge in the market. So, if you want your hotel to stand out in a sea of competition, it’s time to start optimizing your hotel forecasting with technology. As John Steinbeck said, “The best-laid plans of mice and men often go awry,” but with the right tools and strategies in place, hotels can overcome these challenges and achieve success.