IN-DEPTH: With so many channels to track on a daily basis, hotel companies can’t afford to slip up. On the positive side, technology has evolved considerably to keep distribution and revenue management executives up-to-date in this multichannel environment. EyeforTravel’s Ritesh Gupta finds out more

Hotel companies continue to pursue a connectivity strategy that provides the broadest reach possible at the lowest unit cost while being as accurate as possible. In today’s multi-channel environment, hoteliers need quick access to hotel-rate data and inventory positions on various sales channels. With online sales bringing increased revenue, it’s vital that hotels proactively manage their online presence and ensure room rates and availability accurately reflect their current status on all sales channels.

The process of doing this manually is now a thing of the past and even having separate pieces of software to manage different aspects of online sales is almost outdated “Over the last couple of years we have seen increased focus on integrated applications, wherein hotels can do most of these complex tasks through a single system,” says Michael McCartan, chief executive officer, eRevMax International.

According to McCartan, having one system saves time, reduces costs, and enables revenue managers to focus on the data to hand to make better judgments based on the information in front of them. Consolidating this data into a single integrated system also prevents simple errors and applies restrictions to protect the hotel.

Responding to market needs

From a hotel company’s perspective, Sudhir Ghildiyal, revenue manager - corporate (electronic distribution), The Lalit Suri Hospitality Group, says in the last 12 months, OTAs have taken up rate parity aggressively, thereby putting pressure on the hotels to maintain same rate across all channels. 

This is where the role of channel management technology comes in. “Channel-management solutions have really helped hoteliers to cope up with that pressure (to maintain the same rate). With online revenue registering high growth year-on-year, it becomes crucial to follow rate parity to ensure higher rankings on the OTAs. Moreover, it really helps in keeping a total control of your inventory across all channels,” says Ghildiyal.

On the same issue, Kumar Subramanian, head of sales and revenue management, Royal Orchid Hotels, says revenue managers should abstain from becoming mere “extranet managers”, and should instead focus on revenue management.

“Revenue managers have more important things to tackle than learning how to enter the same data over and over into several websites. Using technology called RTChannelmanager, has created more time for hotel professionals to implement real revenue management ideas and execute them,” says Subramanian.

McCartan says hotels have moved from a strategy of selling on as many channels as possible, to being focused on the best-producing sites for long-term financial gain and inventory management. “Today, the reservation data and channel margin is providing the insight required for selecting the most profitable channels and to avoid being distracted from the hundreds of new channels promising gold,” he says.

Hotels have also had to control rate parity and provide inventory to all partners to avoid breaching contractual obligations, and therefore the advancement of technology in this space is solving these problems, according to McCartan.

Getting the right technology?

Hotel companies have to diligently assess the technology available for automating their distribution and reservations systems.

Some of the major considerations are:

·        Technology has to be more price sensitive considering the cost of online distribution.

·        It should be sufficiently robust to interface with any PMS/ CRS/CRM irrespective of the service provider.

·        Mobile and tablet tools are evolving and technology should support such systems not just technically, but with a strategic viewpoint to business.

A channel manager for hotel companies is a key component in distribution and revenue management, and so it’s imperative that the solution chosen is user friendly, reliable and saves time. Until a couple of years ago, updating sites was a time-consuming and tedious task. It was a full-time job to get the rates and inventory loaded and then to double check and ensure parity. But all this has changed considerably.

Quick response

Today there are solutions that are capable of consolidating live market information so revenue managers can stay at the top of their game without losing position or revenue.

The live status of room rates alongside web ranking reports provides the state of play. Availability figures based on inventory supply help to show which channels are bringing bookings, while booking-data delivery ensures all reservations reach the hotel as and when they happen.

“Real-time XML connectivity with channels and optional integration with revenue management and property management systems allows hotels to respond to market conditions and process rate and inventory updates faster than ever before,” says McCartan.

Products are also becoming more user friendly, as a wider cross-section of hotel staff use these tools – from front of house, general manager and revenue management specialists. Therefore navigation needs to be simple for all, making quick updates easy and providing comprehensive settings between rate shopping and channel management for more sophisticated sales strategies. The inclusion of historical reports, reservation data and administration functions will provide even greater control to the OTA sales channels.

“The automated nature of the next generation of tools mean hotels need greater protection from over selling, therefore in-built safeguards provide alerts and notifications of channel performance and manual overrides when certain conditions are achieved,” says McCartan. “A focus on XML integration providing two-way data transfer is giving greater access to OTAs especially to deliver automated channel solutions.”

With the latest channel-management tools, hoteliers are now able to maintain various channels with all necessary data at their fingertips. This allows them to keep things much simpler in a world where hotels have much greater exposure, and get business from many more markets.

Looking ahead

The technology available to help hotels automate their distribution and reservation systems is still evolving, but significant progress has been made in this direction.

“Compare the time when reservations were made over the phone three to six months ahead of the stay to today, when a guest can make a reservation online or through mobile even on the day of the stay,” says McCartan. This is all thanks to automation that hotels can make availability updates in real-time and guests can make reservations on the move. “We still have a long way to go, but we are beginning to see more parties taking part in developing this rather than fighting one another.”

As demands on data get bigger and more intelligent, so the need for more two-way connectivity increases. The sooner technology companies work together, the quicker automation will become.