How Pricing Manager helps Independent Hotels effortlessly set the right price
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Imagine this: you're the owner of a charming boutique hotel nestled in a bustling city. Every day you're juggling a multitude of tasks - managing staff, ensuring your guests are satisfied, overseeing operations, and so much more. Running an independent hotel comes with its own unique set of challenges.
One of the biggest? Pricing.
Navigating fluctuating market demand, competitors and your own occupancy can make finding the optimal price feel like a never-ending challenge. Not having the time to implement a pricing strategy adds another layer of frustration, as another missed revenue opportunity slips through your fingers.
Price your rooms too high, and you scare off potential guests. Price them too low, and you leave money on the table. And when you notice the hotel across the road - similar to yours - has bumped their rates again that day, you might even find yourself wondering what information they have that you're missing?
That's where Pricing Manager comes in.
Created with the unique needs of independent hotels in mind, Pricing Manager is a pricing recommendation tool that easily automates the right rates for your hotel, freeing up busy hoteliers, like you, to focus on providing excellent service to your guests.
The pricing challenge for Independent Hotels
It’s no secret that competition within the hospitality industry has become much more fierce in recent years, and while there is no one-size-fits-all approach to room pricing, maintaining a flexible pricing strategy is key to being agile and moving fast with rate changes.
However, being nimble also requires dedicated time and effort, personnel, knowledge of the local market, including booking patterns, guest preferences, the competitive landscape, your own pricing, both historic and forward-looking, and how you are pacing - there’s a lot that goes into making a pricing decision - and it all needs to be fueled by a steady stream of high-quality data, and supported by a constant cycle of analysis and monitoring to make any difference to your business.
Although this might seem daunting for an independent hotel, without teams dedicated to revenue management, technology can now make implementing the right prices effortless.
So how does Pricing Manager deliver accurate pricing recommendations tailored to your property? How does it help you navigate the complexities of setting the right price for your hotel?
In this blog, we’ll explore some of the mechanisms that go into setting the right price for your property.
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Data quality: The foundation of Pricing Manager
Data is the foundation of any pricing recommendation tool, and when it comes to data quality, the old adage of ‘garbage in, garbage out’ still rings true.
Simply put: If we put bad information into our models and forecasts, we will get bad information out of them. Superior data quality has an unequivocal competitive advantage, which is why Pricing Manager is fed by the industry’s most diverse data set (2 billion+ rates shopped daily to guide your prices) - a data set trusted by over 65 000 hotels worldwide.
While data is the backbone of Pricing Manager, at Lighthouse we firmly believe that transparency around how we arrive at our prices is almost equally as important. Our commitment to transparency means we show you the factors influencing our price recommendations while giving you the freedom and flexibility to stay in complete control of your pricing recommendations.
The price recommendation process begins by diving deep into your hotel's unique pricing patterns. We start by asking critical questions:
How have your rates fluctuated over the past year?
Which months or seasons see the highest demand?
Are there specific events or holidays that significantly impact your bookings?
This thorough analysis helps us establish a robust baseline for your hotel's pricing strategy.
Once we have this baseline, we incorporate several key elements to provide you with precise and actionable price recommendations.
Right compset selection: A tailored approach to competitive pricing
Your pricing strategy is influenced by the competitive landscape, which is why we integrate your compset – the hotels you compete with – into our pricing model.
Fortunately, when you begin your Pricing Manager setup, a list of competitors will be recommended to you, which you can effortlessly adjust if needs be.
This involves identifying hotels that are similar to yours in terms of location, star rating, and amenities resulting in a recommendation that is more tailored to the qualities of your property, rather than a recommendation based on the overall market behavior.
By doing so, Pricing Manager allows you to strategically align your pricing with the most relevant competitors and monitors each competitor’s room pricing and adjustments over time, whether they are raising rates for peak days or lowering prices for promotions.
This real-time tracking ensures your pricing remains competitive.
Not all competitors affect your business equally - you should be comparing apples to apples. You can also assign importance to each competitor, ensuring your recommendations prioritize those with the greatest impact on your business.
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Utilizing historical and forward-looking data for setting the right price
By harnessing the power of both historical and forward-looking data, Pricing Manager is able to capture new and emerging trends up to 365 days ahead, while factoring in past pricing performance to ensure you are always positioned effectively with an offer that reflects demand.
Forward-looking data enables quick adaptation to new trends and events, giving you the flexibility to adapt as trends emerge. Historical data, meanwhile, captures seasonalities and long-term trends.
Consider the upcoming annual city festival that draws thousands of visitors to your city, for example. Pricing Manager will analyze booking trends from previous years and current booking patterns to suggest optimal rates for the festival period.
This dual approach ensures that your pricing is both reactive and proactive, maximizing your revenue potential and helping you to capture your fair share of the market.
Monitoring occupancy and booking pace with Pricing Manager
Are you picking up new bookings? At what pace? Is your current occupancy for a particular stay date higher or lower than what you would normally expect at a similar point in time? Pricing Assistant analyzes your typical booking pattern to understand how your rooms are being booked.
For instance, if your hotel usually sees a surge in bookings two weeks before a major conference, Pricing Manager will take this into account.
If this year’s bookings are slower than usual, it might recommend lowering prices slightly to attract more guests, or running a promotion to stimulate demand and booking momentum.
By integrating your PMS with Pricing Manager, you can supercharge your price recommendations so that crucial metrics, such as your pickup, your pace and your on-the-books occupancy, are factored into any pricing recommendations.
Rate configuration and customization catering to your hotel's unique needs
One of the joys of independent hotels is their individuality - each property with its own distinct charm and character. This uniqueness extends to pricing as well.
Your base rate may vary significantly from the hotel next door, considering factors like rate type (Best Flex or Lowest), room type, length of stay, and meal inclusions. Pricing Manager allows you to tailor these settings to perfectly match your hotel's specific needs.
Unlike other systems that focus exclusively on the Best Available Rate (BAR), Pricing Manager evaluates the best rate configuration for your property, including options like Lowest Rate, Best Flex, Length of Stay, and guest count. This bespoke approach ensures that your pricing strategy is finely tuned to your unique circumstances.
The hospitality market is ever-changing, and staying ahead requires access to the freshest data. Pricing Manager updates your data almost live, ensuring that your price recommendations are always based on the latest information.
With an hourly OTB refresh (based on your PMS capabilities) and a daily refresh of market and competitor data, Pricing Manager lets you stay on top of last-minute changes, by providing you with the most current insights for decision-making.
Summary: The benefits of automated pricing for Independent Hotels
Running an independent hotel is no small feat - you're a manager, marketer, strategist, operations supervisor, guest relations champion, and occasionally even a handyman. With Pricing Manager, you don't have to be a revenue management expert as well.
Fortunately, advances in technology have made this attainable, even for smaller properties that don’t have the luxury of dedicated revenue staff.
Pricing Manager helps you capture your fair share of the market at the right price. From choosing the right compset to comparing rate configurations, Pricing Manager takes the guesswork out of pricing, ensuring your strategy is always optimal while giving you complete control and transparency.
By using a mix of historical and forward-looking data, Pricing Manager provides reliable and flexible pricing recommendations.
This way, you'll always stay one step ahead of your competitors and can focus on what you do best – providing an exceptional experience for your guests.
For more information on how Pricing Manager can transform your pricing strategy, contact us today or start your free trial. Don’t see your PMS listed?
We have multiple options to ensure you begin automating pricing recommendations at your property as soon as possible.
Ready to take control of your pricing strategy?
Get started with a free trial of Pricing Manager today.