Over the years, airlines, most cruise ship and train operators together with many hotel brands have understood and in the main applied the concept of ‘revenue control’ very effectively.
It’s almost a given that when you board a plane, even when you are in the same designated seating class, that passengers have paid different levels of fares, for in many cases an identical level of service.
Hotels too, especially with 100 rooms or more, constantly battle with the dilemma of using more creating marketing ways to attract a higher percentage of direct rack rate paying guests or entrust tour operators to fill contracted allocations of rooms at heavily discounted prices.
Other options include online-websites like Expedia among the several others, but again these also attract a lower net rate.
A very simple equation is to fill 100 rooms at US$100 would bring you $70,000 through direct bookings, while the same number would probably realise only $49,000 per week through a wholesaler or tour operator.
The question then to ask is, by spending a proportion of the differential, could you drive more higher direct revenue income?
In many cases I believe the answer would be yes! Continue reading