Dynamic Pricing Friend Foe or the Future Presented
- Slides: 22
Dynamic Pricing Friend, Foe or the Future? Presented by Sean Mc. Curdy Global Director of Worldwide Sales Interstate Hotels & Resorts
Agenda l Hotel Trivia l Dynamic Pricing l What is it? l How to evaluate it? l Is it right for you? l Amenities Travelers Prefer l What is Negotiable?
Hotel Trivia 1930 l The standard travel agent commission was? A. 5% l B. $1 l l C. 10% Average Room Rate? l A. $1. 34 l B. $5. 60 l C. $15. 80 l
Hotel Trivia 1950 JW Marriott opens his first hotel in? l A. Arlington VA B. Atlanta GA l C. New York NY l 1951 First hotel company to install televisions in all the guest rooms? l A. Wingate l B. La Quinta l C. Hilton
Hotel Trivia 1950 l Kemmons Wilson opens his first Holiday Inn, where? l A. Atlanta l B. Memphis l C. Irvine l He named his hotel after? l A. His first Vacation l B. A National Holiday l C. A Bing Crosby movie
Economic Factors Driving Dynamic Pricing l Inflation l Demand grew 4. 5% vs. Supply of 1. 3% l Consolidation of ownership-greater control on pricing l Dramatic increase in control over rate integrity and inventory l Aftermath of Hurricanes
Industry Factors Driving Dynamic Pricing Allied Members l Desire to simplify the RFP Process l Negotiate Rates based upon Demand l Major Brand Support Direct Members l Increase Hotel Compliance l Opportunity to expand preferred partnership in secondary cities l Eliminate 3 rd Party Costs
What is Dynamic Pricing? l l Fixed % off a floating benchmark rate. n Consortia n Corporate n Best Available Benchmark rate will float up or down based upon market conditions.
What should you consider? l How often do your travelers receive the negotiated rate at your preferred hotels? l Will the discount apply to other room types? Will it cover all properties (chain-wide) or selected properties? Will the % discounts vary by city & volume? Or will one fixed % that applies to all properties? Will you be able to negotiate value added amenities? What is your benchmark? Will the rate fluctuate by night for a multiple stay? l l
Key Areas of Consideration l Financial n n l Can your suppliers provide a data-driven model that quantifies the economic benefits. Are all of your suppliers providing a similar pricing model, how will this affect non-dynamic preferred agreements. How do your current negotiated rates compare to other benchmark rates? Dynamic Pricing may additional hotels that could not offer you a negotiated rate, resulting in incremental savings. Measure the effectiveness on an on-going basis.
Key Areas of Consideration l Traveler Experience n How will you communicate the new model to your travelers? Will they understand the value of the discount? n How will travelers forecast or budget their hotel costs? n If your travelers are performing client-billable services, how will the changes be communicated to their clients? n Are you travelers required to use per diem or city caps?
Key Areas of Consideration l Change Management n n n How will the forecast and budgeting process be changed? How will you manage cities where you have a hybrid situation? How will online booking tools and travel agencies manage and sell rates? How will the discounts be validated and audited? How will pre-trip approval and post-trip expense audits need to be changed? Will you be able to quantify the value of the new program to management?
Dynamic Pricing l Is it right for you?
What is negotiable?
Hotel Trivia 1960 l 1962 Curt Carslon buys shares of this Minneapolis hotel? l Typical hotel had? 120 rooms, 39 rooms, or 78 rooms. l Average occupancy? 45%, 67% or 85%. l First cable movie station offered in hotel rooms? HBO & Cinemax or Showtime & The Movie Channel.
Questions & Answers
Available Resources NBTA Hotel Committee: Rate loading white paper-glossary of industry terms. 2006 NBTA Modular Hotel RFP: includes copies of the Modules, Specifications, Instructions, Templates, Vendors, French, German and Spanish Translations - Best Practices: Hotel RFP Package - Best Practices: Company Overview Sample - Best Practices: Rate Accept Sample - Best Practices: Rate Reject Sample - Best Practices: Cover Letter Samples - How to Develop a Hotel Program - Recommendations on Hotel Reverse Auctions - Reverse Auction Resource List - RFP Vendor Resource List
Historical Perspective of Occupancy and ADR
- Hello my friend hello song
- Hello my future
- Friend or foe? (game show)
- Friend or foe chapter 2
- Friend or foe station lab answers
- Future continuous and future perfect
- Future perfect e future perfect continuous esercizi
- A friend in needs a friend indeed
- I've found a friend oh such a friend
- To have a friend you must be a friend
- Foaf a matic
- Golden crops foe
- Foe joe
- Calcolatore foe
- Fyp mmu
- Foe by jm coetzee summary
- Birth of shaka
- Fee fie foe firm
- Pothos statua
- Golden crops foe
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- As cannons overcharged with double cracks
- Dynamic pricing in railways