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H323 HOSP. REVENUE MANAGEMENT - Coggle Diagram
H323 HOSP.
REVENUE MANAGEMENT
1. REVENUE MANAGEMENT
Common Characteristics
High Fixed Cost
Market can be segmented
Relatively Fixed Capacity
Perishable product
Variable Demand
Evolution of
Revenue Management
Descriptive
Predictive
Prescriptive
Using data driven forecasts to predict demand and booking patterns, and then optimise, pricing and availability of inventory within each market segment to match that demand
2. Key Performance Indicators
KPIs in revenue management evaluate how effectively a company uses its resources (capacity and inventory) to produce income in the service and hospitality sectors.
The main indicator of revenue management efficacy is how different revenue management activities, like pricing strategies, process enhancements, and inventory/capacity management, affect a company's overall success.
KPIs in the hosp. industry
Raw Data Fields
Supply
Demand
Revenue
Hotel Rooms
RevPAR
Restaurants
RevPASH
Event Space
RevPASF
Golf Course
RevPATT
Fair Market Share
Market Penetration Index (MPI)
Average Revenue Index (ARI
Revenue Generation Index (RGI)
3. The Competitive Landscape
Identifying the
market segments
Characteristics
Preference
Behavioural
Competition
(understanding the market)
Criteria
Proximity (location)
Price (Business Tier)
Product (Business Services)
Market (customer segments)
4. Revenue Management Process
4 Main Activities:
Forecasting
Optimisation
Control
Data Collection
Data Compilation
Booking Activity
Demand Forecast & Optimisation
Types of Data
Historical Business Data (internal)
Current Business Data (internal)
Market Data (External)
Booking Pace
Pace Comparison Metrics
Lagging Months
Ahead Months
5. Demand Forecast
Types of Forecast
Demand Forecast
Strategic Forecast
Revenue Forecast
Operational Forecast
considerations
for forecasting
What to Forecast
Level of aggregation
Unconstrained method
Number of periods to include in forecast
Outliners/ exception
Demand Forecast
Increases
Increase pricing
Restrict Discounts
Force premium products
Shift group/ bulk purchase to other dates
Demand Forecast
Decrease
Decrease pricing
Relax Restrictions
Add Sales Deployment
Increase marketing spend
6. Market Segmentation
Classify and target customers based upon their characteristics, behaviour, and preferences
Products and services are not homogeneous
Pricing by Segmentation
Criteria
Membership
Size of Group
Geographical Location
Fencing Segments
Physical
Controlled Availability
Transactional Characteristics
Product Line
Factors influencing buying decision
Environmental
Personal
Interpersonal
Organisational