Large hotels often benefit from dedicated revenue managers who’s job it is to scour the market, looking for opportunities to maximise room rates for profitability and occupancy.
If you’re running a small hotel, we’re going to take a wild guess that you probably haven’t got a revenue manager.
It’s you, isn’t it?
Only, you’re the gardener, too. And occasional chef. Oh, and because Michael’s decided to take the week off and head to Corfu, you’ve got to run reception, as well.
Every hotelier (ok, most) are busy - particularly at this time of year - but that shouldn’t make it impossible to work on pricing strategies that ensure the hotel remains full for the rest of the year and beyond.
Here’s five ingenious pricing strategies for small hotels:
1. Go for a super-low rate
The proverbial ‘dropping of one’s trousers’ when it comes to room pricing might feel somewhat demeaning, but there’s absolutely nothing wrong with occasionally offering a super-low rate.
Make it clear that this is an incredibly rare occurrence and that you’ve implemented it to give as many people as possible the chance to check out how awesome your hotel is, and you’ll inevitably raise occupancy levels.
Just make sure you hike the prices back up sharpish and work hard to retain your new customers’ business in future (at standard rates!).
2. Justify a price hike
If the thought of super-low rates has made you feel faint, there’s another option.
Jack them up!
Feels better, eh?
If you can raise the price of your rooms above that of the competition, you have the perfect opportunity to explain why yours are worth the extra spend.
Throw in a few extras, by all means, but be bold enough to point out that your hotel is worth more than the lowly-priced competition.
3. Capture the middle ground
If you align the prices of your basic rooms with the cheapest market pricing and set the rates for your other rooms closer to your competitors’ base level pricing, you should put your hotel squarely in front the middle market.
Oh, and you’ll still be capturing the lower and higher markets, too - thus killing three birds with one stone, as it were.
4. Take a leaf out of the retailer’s book
When you buy something in a supermarket, it’s rarely a rounded price. Rather than £10, it’ll be £9.99.
You can do the same with your room rates. And, yes, this may feel a bit ‘cheap’ and ‘retail-y’, but that’s the point; we know consumers react well to such pricing strategies, so why not take advantage of them in the hospitality industry?
5. Price match
If all else fails - go for the jugular and price match your competitors.
This is what revenue managers spend a great deal of their time doing, because it remains an effective pricing strategy for most hotels.
If you’re forever cursing the hotel down the road that seems to be overflowing with guests, there’s a reason they’re doing so well, and it may be because you’re either too cheap or expensive by comparison.
Equally, if they’re that busy, there are clearly a great number of new guests to be had, therefore you’ll stand a far better chance of competing if you do so on a level playing field.
You’ve got time to work on the above, we promise. And, if you don’t think you have - make time, because if you don’t, the competition will gain a significant lead.