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How Resorts Manage Revenue in a Digital World

In today’s online world, planning a vacation, booking a hotel room or purchasing an airline ticket is just a few clicks away, and the options for where to buy are seemingly endless. For revenue managers in the hospitality industry, technology plays a key role in ensuring maximum profit, achieving rate parity across all booking channels and managing room inventory.

The latest revenue management systems are helping operators forecast demand, segment guests and optimize pricing, while also remaining consistent across all partner websites, such as Expedia and Travelocity. As an added benefit, these systems can reduce labor-intensive calculations and allow employees to focus on interpreting data and making decisions. HT talks to several major resort firms — Las Vegas Sands, Atlantis Paradise Island Resort, and Kees Vacation Rentals — about the impact that revenue management technology is having at their properties.

The impact of better forecasting
The macro benefit of a revenue management system is to maximize profitability by developing sophisticated forecast and price elasticity models that can go beyond the capabilities of manual calculations. At Las Vegas Sands ( analysts have recouped hours of time through the implementation of the IDeaS ( revenue management system. “Today’s systems can process data and run complex calculations in a matter of minutes,” says Mark Molinari, corporate vice president of revenue optimization at Las Vegas Sands.

Atlantis Paradise Island Resort ( in the Bahamas experienced a three-to-five percent uplift when it moved away from manual spreadsheets. “Basic spreadsheets don’t take into account patterns or the current forecast,” says Ken Gifford, vice president of revenue and distribution management for Atlantis. Today, the resort relies on Rainmaker’s ( GuestREV and GroupRev revenue management technology to manage rooms. “I know I’m managing revenue better than what I did through spreadsheets alone. There is a marked difference.”

Atlantis is also able to forecast demand in the casino at a certain level of play, and then optimize to ensure there are rooms available for the most valuable customer to arrive on any given day. According to Gifford, the resort tracks guest casino play and adds this into the forecast. “On a high level, if I have a $500 a day gamer versus a  $200 a day guest room, I want to take the $500 player.”

The system forecasts based on historical data and current trends, and runs nightly, he explains. Every morning the team is presented with a new forecast, and can see more than 500 days into the future. If the forecast is predicting more demand than capacity on the property, the company can make changes to ensure they attract the highest value customer.

“We would leverage that by increasing rates, the same way the airlines do when they have more demand. We review the recommendations for the system and then will send out pricing changes,” Gifford says.

At Las Vegas Sands, with 10 properties worldwide, IDeaS is supplemented with a custom-built system for managing meeting space, which allows the company to evaluate group bookings for revenue potential. This helps them review how much meeting space a group is requesting and put a value on it.

“Our Las Vegas team developed an automated group pricing and meeting space optimization model that takes into account factors such as the day of the week, seasonality, length of stay, requested room rate, meeting space, food and beverage, rental, etc., to determine the optimal price,” says Molnari. “If a group wants 1,000 rooms, but takes up all our meeting space, then it will preclude us from selling more rooms to other groups. If we have a space-heavy group, we apply an opportunity cost to that additional space, which would have to be offset by a higher room rate or additional room rental.”

Managing third-party inventory
Revenue management systems are helping hotels address a top challenge in room inventory: rate parity with third-party sellers such as Orbitz and Expedia. Not only do operators want to make sure all partner sites offer the same rates and deals, but they also want to be able to make changes quickly and easily.
At Kees Vacations ( based in Newport News, Va., the staff previously logged in to each partner website manually to make rate changes for its 30 resorts and hotel properties. Today, using LeisureLink (, the inventory and rate changes are distributed from the system. Kees Vacations Rentals specializes in non-traditional lodging — timeshares, vacation properties, resorts, condos, villas and the like. According to CEO Jeremy Gregg, prior to using LeisureLink’s Marketspan solution, the firm’s pricing strategy consisted of old-fashioned techniques: “We would go to Expedia, look at competitors’ pricing, look at inventory, and then make decisions based on that data,” Gregg explains in a testimonial. “This resulted in an unnecessary amount of work and rates that were only based off of Expedia’s data.”

Using Marketspan, Kees was able to select its competitive set and determine a floor rate. Kees keeps inventory up to date and Marketspan manages the rest. “Now I just scroll through my iPhone and watch it change the rates for me and my rev managers are adjusting algorithms instead of managing rates.”

This has greatly improved parity with third-party suppliers. “Our goal is no matter where you go to book online you will get the same rate, pictures and content, which is extremely challenging and needs to be monitored daily,” says Gregg. “It’s a lot easier with the technology pushing changes out to all channels.”

In July, Leisure Link added a mobile app version of their full-service distribution, marketing and sales platform. The app automates and implements pricing, promotion and inventory allocation strategies. It also offers some additional features including notifications that alert managers about new bookings and low inventory.

Both Atlantis and Las Vegas Sands rely on Hotel Booking Solutions Inc. (HBSI) ( to automatically push rates to all third party sites, which interfaces with property management and revenue management systems. The Las Vegas Sands also uses a variety of rate shopping tools including TravelClick ( and AnyRate (www.any-
) to supply them with competitive rates, which feeds into the IDeaS revenue management system, along with transaction data from the reservation system.

“We want to ensure rate parity through all the different distribution channels. In the past we would have people manually updating rates, which took a long time. The technology now allows us to distribute availability, rates and inventory to all of our partners in near real time,” says Molinari.               
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