By Paul Wood, CRME, CHBA, Vice President of Revenue Management, Greenwood Hospitality Group, and member of HSMAI's Revenue Management Advisory Board

Every business professional understands the value of creating a unique experience or a product which stands out from the rest of the herd. In a changing environment, how do you strive to create the singular experience in a crowd where everyone else is trying to stand out and be different? Take the opportunity to think out of the box in order to:

* Articulate what your hotel is to the customer.

* Understand the customer's needs and habits.

* Create a holistic vision.

Understand What Your Hotel is to the Customer

Determining initial conditions of your property's marketing efforts and revenue management processes is a must. When doing so the efforts of the team create significantly varied possibilities and the baseline of a strategic thought process. These variables shape and determine the overall conditions which influence the desired outcome. Your hotel's value statement and defined goals are created from this process and thereby help to define an out of the box revenue management and marketing strategy. These strategies will impact each and every guest. Initial condition sensitivity can easily be defined by the fact that perceptions are reality. The perception of every guest is different, because of their past experience in your hotel, or for that matter, any hotel they have experienced in the past. While the traveler's perception of the conditions at your hotel may be different, the generalized expectation remains the same within the constant state in which the initial conditions are deployed and met.

Understand the Customer's Habits

Understanding your initial conditions allows for the property team to measure its strategic and tactical efforts toward everything it produces and sets in place. For example, if your rates are not in parity across all channels the effect will change the habit of the consumer to not trust the rate channel and begin to shop on a less profitable channel for the Hotel. Another example would be if you are a national restaurant chain, the consumer already anticipates what to expect, both from a menu and service standpoint. Often, many travelers do not look at the menu when they go to their favorite restaurant. Repeat clientele are programmed to order familiar menu items. Given these factors, how could you think out of the box to create a unique experience? There are several ways to stand out, both positive and negative. These include; excellent service, customer acknowledgment, or offering regional based product and features. These nuances can alter the customer's perceived experience and their future expectations. Notwithstanding, a poor experience can not only affect the specific restaurant, but negatively impact the consumer's perception of the entire brand.

Further understanding of customer habits leads to better marketing through the use of segmentation. As such, the more information we possess and use ultimately leads to better management of revenues, capture and revenue potential for our individual hotels. The information gained specific to consumer habits also allows the revenue team to create tactical plans, manage rates more effectively and better control booking lead times. Additionally, measurement and tracking of consumer habits enhances the hotel team's marketing efforts. In turn, consumer needs are better met and the property team gains more control in terms of developing defined strategies and processes. As an example, revenue management can deploy the absolute best strategies, great packages and offerings, but if the hotel does not understand consumer habits and does not market to them correctly no one will know about the offering.

Important to thinking out of the box, the concept of replicable processes should be deployed through every level of the hotel and company. Replicable success or ergodicity is a state of positive recurrent variables which define the nature of the system when it is allowed to play out for an extended period. As an example, in hiring a new front office agent, the agent will be trained in line with the habitual parameters of the trainer. Thereby, the initial habits of the trainer will be replicated by the trainee. Statistically speaking, the system evolves for a long time and eventually forgets the original state and initial influences of the trainer. Though the system has evolved, the evolution of the system has positive and negative effects which must be controlled. The allowance of non-controlled processes will end up hurting the established culture. Metaphorically, the blind would be leading the blind and the person with one eye is king.

To remain out of the box, each individual must be responsible for controlling and improving each part of the process in a positive way. In part, having a creative, empowered team allows for the system to grow and improve over time, creating a more unique experience for the consumer.

Understand the Importance of a Holistic Approach

Essential to thinking out of the box and creating the unique experience revolves around a holistic approach. Your function in the system whether, it is revenue management, sales & marketing, food & beverage or operations needs to have the same overlying vision from top to bottom. In principal, taking a holistic approach to thinking out of the box relates to the recognition of the entire team which functions as separate parts, then working parts into one finely tuned machine creating an all-inclusive vision from top to bottom.

For example, every associate should know about a VIP meeting planner coming to your property. During a site tour of a guest room, the housekeeper is able to say hello Ms. Smith, welcome to our hotel, my name is Suzy and I will be personally cleaning this room when your group arrives. Is your entire staff able to talk to Ms. Smith? Or are you terrified of what will happen? If comfortable with the communication, you have a holistic approach to your hotel. Another example of a holistic approach from a revenue management point of view is in your deployment of rate structures. Have your rates been deployed in a touch one/affect many system (given the limitations of the system) or do you have the hotel rates all static? If based on the touch one/affect many concepts you have a closer relationship to the holistic approach to rate deployment. Most hotels have daily business meetings where they communicate the previous day's results. How often are the meetings attended by hourly associates? Or during departmental meetings, how often are outside departments invited to attend, and participate in, the meeting? A holistic approach enhances and benefits from the entire team acting as one. Information is shared and not fragmented and as a result, consistency in messaging and process improvement is realized. As you can see, even when championing outside of the box thinking we can realize heightened communication and efficiencies.

Thinking out of the box can be summarized into a few truths:

1. Understand what your Hotel is and be true to the expectations.

2. Setting up your system with minimum complexity and maximum redundancy allows for greater communication and profit.

3. Defining and creating a vision for the entire property is essential to the holistic approach to thinking out of the box.

Differentiating oneself from your competition is not about your location, a fancy new feature, renovated guest rooms, great marketing deployment, and the flag you fly, or even selling the right price to the right consumer. Thinking out of the box is a culture and a thought process. Being unique is human nature, as we are the sum of our own experiences. However, commonality exists within all experiences, understanding the needs of the consumer leads to fulfilling your guest's desires. Thereby, creating a unique experience and bringing order to chaos.

About the Author

Paul Wood is Vice President of Revenue Management for Greenwood Hospitality Group where he has the responsibility of growing profits for Greenwood's portfolio of hotels via planning and implementing revenue and profit optimization. Prior to his current role, he served as Senior Account Director for Sceptre Hospitality and Corporate Director of Revenue Management for Richfield Hospitality where he expanded the Sceptre and Richfield Revenue Management platform to include hospitality investments and acquisitions. During his career, Paul has overseen a number of major initiatives including development of mixed-use profit optimization programs, e-commerce, GDS, business intelligence, CRM and revenue management. He is a Certified Revenue Management Executive and currently serves on HSMAI's Revenue Management Advisory Board.

About the HSMAI Revenue Management Advisory Board

The Revenue Management Advisory Board leverages insights, emerging trends, and industry innovations to guide the development of products and programs that optimize revenue for hotels. www.revmanagement.org

Members include:

* Chris K. Anderson, Ph.D., Professor, Cornell University

* Bonnie Buckhiester, Principal, Buckhiester Management USA

* Shelia Cosgrove, Director, Revenue Management Ops & Planning, Intercontinental Hotels Group

* Kathleen Cullen, CRME, Corporate Director of Revenue Strategies, Heritage Hotels and Resorts

* Sloan Dean, CRME, Vice President of Sales & Marketing, Interstate Hotels & Resorts

* Kent Duncan, CRME, Vice President, Sales and Revenue Strategy, Marcus Hotels & Resorts

* Jon Eliot, CRME, CHA and co-chair of the HSMAI Revenue Management Advisory Board

* Tammy Farley, Principal, The Rainmaker Group

* Neal Fegan, Executive Director of Revenue Management, Fairmont Raffles Hotels International

* Rhett Hirko, CRME, Director of Revenue Analytics, Hyatt Hotels & Resorts International Operations

* Jay Hubbs, Director Hotel Supplier Relations, Expedia Partner Services Group / Hotwire

* Burl Hutchison, CRME, Director of Revenue Optimization, Sabre Hospitality Solutions

* Klaus Kohlmayr, Senior Director, Consulting, IDeaS Revenue Optimization

* John LeCoz, CRME, Regional Director of Revenue Management, Loews Hotels

* Mark Molinari, CRME, Corporate Vice President of Revenue Management and Distribution, Las Vegas Sands

* Orly Ripmaster, CRME, Senior Analyst, STR Analytics

* Scott Roby, CRME, Vice President, Revenue Management, Evolution Hospitality

* Chinmai Sharma, CRME, Vice President, Revenue Management, Wyndham Hotel Group

* Susan Spencer, Market Director - N. America, ChannelRUSH

* Trevor Stuart-Hill, CRME, President, Revenue Matters

* Paul Wood, CRME, CHBA, Vice President of Revenue Management, Greenwood Hospitality Group

Want to Learn More?

This topic will be addressed as part of the 10-part Revenue Management Webinar Series produced by the HSMAI University in partnership with HotelNewsNow and STR. Beginning February 21, 2012, and going through December, each month a webinar will cover various aspects of cutting edge revenue management in today's economy in conjunction with articles written by members of the HSMAI Revenue Management Advisory Board. If you're not able to attend a live program, archives are available. Also, these and other timely revenue management topics will be the focus of the HSMAI Revenue Optimization Conference, co-located with HITEC, June 25 in Baltimore, Maryland.

Hoteliers who have not made the jump into the mobile space are missing out as more customers are looking-and booking-through mobile websites and mobile applications on their smartphones and tablet devices.

Dr. Bill Carroll, senior lecturer at Cornell University, hosted a webinar panel discussion explaining why hoteliers should be active on mobile platforms, how it can best be used for customer service and marketing, and how hotels can make money through its mobile initiatives. Panelists included Paolo Torchio, vice president of E-marketing & Revenue Consulting for Sabre Hospitality Solutions; Loren Gray, director of E-Commerce for Ocean Properties, Ltd.; and Max Starkov, president & CEO of HeBS Digital.

Website vs. App?

Deciding between launching a mobile website or a mobile app is a common conundrum. Torchio said that decision must be made on a case-by-case basis but the mobile web is a cheaper, more versatile option. He said it is important to consider the value from a consumer's standpoint: "Do you have a compelling reason for them to download an app?" If not, then the focus should be on developing a mobile website that works across all device platforms, has easy-to-navigate information and strong customer service. Optimizing the booking experience-the ability to check rates, make and change reservations-is the first, most important step. But it can't stop there.

"The minute the reservation is completed, you need to look beyond the confirmation to see how you can engage with them in the mobile space. Whether it's offering discounts while they are on property, sending confirmation via text or creating a mobile concierge, the key is how much engagement you can have with the customer in the pre-arrival window."

Mobile marketing

Mobile web vs. app won't matter much if your property hasn't taken ownership of its space. Gray said location is everything in the mobile world and it is important that you claim your location and make sure you are representing your property's message.

"This is an ever-growing section of marketing. It is not something to be ignored," he said.

To get the most out of your marketing efforts, Gray said hoteliers must focus on maintaining a strong presence in the following areas: mobile SERPs (search engine results pages); mobile ad networks; social ad networks; text-based offerings; and location-based services.

Creating brand awareness, using these channels to attract people to your ancillary services (restaurant, spa, etc.) and offering mobile-specific promotions all can be achieved with a solid marketing presence.

"You're in the mobile space whether you know it or not-so it is important to control that presence and make it your own," he said.

Starkov said it is essential that hoteliers make mobile search engine optimization and marketing a priority. He agreed with Gray that controlling the message is essential and that the official message be aligned as closely as possible with user-generated content.

Controlling the content is one part of the puzzle. The other is controlling the presentation of the information. He stressed that mobile websites must be organized differently than desktop websites, with unique and engaging content to provide a better user experience.

And above all else, he cautioned hoteliers not to discount on the mobile platform: "Mobile is by default a last-minute distribution channel. Most bookings via mobile are same night or following night reservations. Rate parity in the mobile channel is a must."

To purchase a recording of this webinar or any previous HSMAI University webinar, please go to http://eo2.commpartners.com/users/hsmai/index.php.

Go to www.hsmaiuniversity.org for a calendar of upcoming Webinars.

By Jon Eliot, CRME and Burl Hutchison, CRME, members of HSMAI's Revenue Management Advisory Board

Forecasting is an essential part of effective revenue management. Not only is a forecast a prediction of potential outcomes, but a valuable tool which can be used to set strategies and tactics to improve the expected results. Although forecast accuracy is an important goal, it is more important to take actions that will impact results based on the valuable information your forecast provides.

It would be safe to say that most hoteliers are completing some type of short and long term forecasts. These are often a combination of operational, financial, and demand forecasts. Many revenue managers have become quite proficient at producing accurate forecasts based on historical data, business trends, and market conditions. As more and better data is available and technology continues to improve, revenue managers are better equipped than ever to forecast accurately. The question becomes, is forecast accuracy enough? If the overarching purpose of revenue managers is to optimize revenue, shouldn't they strive to make their forecasts somewhat inaccurate by improving results?

Revenue management leaders need to collaborate with other departments to find ways to proactively improve on the results originally forecasted. There are obvious strategies and tactics we can take to optimize revenue on peak days (increased rates, rate restrictions, length of stay restrictions) and low demand days (promotions, discounts). To separate from the pack and truly maximize potential, the hotel's revenue team should constantly be looking for ways to improve results. Following are some strategies and tactics to consider in your efforts to positively impact results once the forecast is completed.

To maximize higher demand periods:

* First and most obvious, review rates. Pay close attention to competitors and the overall market. Know your value proposition, your competitors' strengths and weaknesses and use all of this to sell your value at a competitive market price. If you have established your value proposition well, don't be afraid to lead a rate increase in the market.

* Know where the demand is by segment and what channels are driving the bookings. If you have enough demand, determine if you can restrict some segments and limit certain channels to decrease booking costs or margins from a higher cost channel.

* Evaluate ways to limit liabilities. Who are your customers on that day or during that time period? If it's a group, know the risks of early departure, and what their history is. Ensure group blocks are netted appropriately and cut off dates are monitored. For all other business, look for ways to avoid cancellations, early check outs, and no shows by using special guarantee/cancel policies or stay restrictions.

* Have clear expectations of where you should, or would like to be at different time intervals leading up to the arrival date and set strategies accordingly. Monitor booking pace as well as denial and turn down information. Ensure restrictions are having the desired effect.

* Focus on demand, not simply rooms on the books. Too often we make decisions based on how many rooms are sold rather than how many we expect to sell. Turning away business is not a bad thing if you have the demand for more favorable business, be it due to rate or stay pattern.

* Manage your product inventory. Ensure you are selling your suites and premium room categories. High demand days typically lead to upgrading guests to a higher room category. If you know demand will be high, limit overselling of standard room types so you can get the appropriate premium for your best room types.

For lower demand periods:

* Again, start by evaluating your rates and value proposition. Do you know your competitors' weaknesses and how to move business from them? Do you have a clear value proposition that justifies your rate offering against your competition? What business is in the market, how is it booking and what rate do you need to capture the business? Don't use discounting as the first response.

* Use a rate structure that allows you to quickly change and manage your rates. Rate management should be quick and as painless as possible. Where possible, don't use extranets as they can inhibit the rate maintenance process. Work with the OTAs that give you the greatest reach without creating more work. The easier it is to manage, the more likely it will be maintained.

* Run targeted promotions. Your demand forecast will tell you when you need the business. Tailor your promotional activities to these specific periods. Utilize fences to ensure you are not trading down and target guests who are likely to stay during these time frames. Low demand periods are your best opportunity to try new offers and new ways of connecting with guests.

* Share the demand forecast with the sales department. A graphic representation of demand will provide the sales team with a quick view of when rooms are expected to be available. This can help to suggest alternative dates to groups inquiring about high demand dates.

* When it's absolutely necessary to discount, look at running short term sales such as a 24 or 48 hour sale. These will often generate a good deal of business in a very short window. Once the promotion is run you may find that you have increased your base business to a level that allows you to increase rates.

* Flash sales are very popular. They can generate a lot of business over a short period of time, but the negative long term effect of such a sale may far outweigh the short term benefits. When considering such a sale, look first at the potential of packaging. Understand that flash sales typically do not lead to repeat business.

* Creatively bundle products and services. Rather than simply decreasing rate, find ways to bundle low cost items into a package offering. It needs to be simple and appealing. Doing so will help to disguise any discount that you gave off the rate and limit the loss in room revenue.

* Institute or reinforce front desk upsell programs. By upselling to higher category rooms, you can increase ADR on lower demand days. To enable this, offer incentives to front desk staff and/or offer special rates for day-of upgrades - if a club room is typically a $50 premium, offer it for $25. Ensure you are still covering the costs of any additional amenities and services included with the premium room categories.

When you start to use your forecast as a benchmark for improvement rather than a prediction of outcome, it also becomes necessary to increase communication with your property team. Everyone must be aware of the forecast and what you are doing to change it. Set clear expectations and collaborate on the methods used to exceed expectations. Constant communication and forecast revision will ensure that everyone knows the strategy and how to achieve it.

The forecast can become an even more powerful tool once the hotel team can use it to get better results. This is not to say revenue managers should sandbag the forecast. Expected outcomes of current strategies should be included in the forecast, but we should always be opportunistic and adjust strategies based on forecasted demand.

About the Authors

Jon Eliot, CRME is a seasoned Revenue Management professional with over twenty years of hospitality industry experience. This experience includes a variety of roles in revenue management, operations and sales at the property, regional, and brand levels. Jon serves as co-chair of the HSMAI Revenue Management Advisory Board. www.linkedin.com/in/joneliot

Burl Hutchison, CRME is the Manager of Revenue and System Optimization for Sabre Hospitality Solutions where he is responsible for consulting with customers in the field of Revenue/CRS/PMS optimization and integration with PMS, CRM and RMS systems. In addition he provides guidance on best practices within the field of revenue management and manages a full service revenue for hire program.

About the HSMAI Revenue Management Advisory Board

The Revenue Management Advisory Board leverages insights, emerging trends, and industry innovations to guide the development of products and programs that optimize revenue for hotels. www.revmanagement.org

Members include:

* Chris K. Anderson, Ph.D., Professor, Cornell University

* Bonnie Buckhiester, Principal, Buckhiester Management USA

* Shelia Cosgrove, Director, Revenue Management Ops & Planning, Intercontinental Hotels Group

* Kathleen Cullen, CRME, Corporate Director of Revenue Strategies, Heritage Hotels and Resorts

* Sloan Dean, CRME, Vice President of Sales & Marketing, Interstate Hotels & Resorts

* Kent Duncan, CRME, Vice President, Sales and Revenue Strategy, Marcus Hotels & Resorts

* Jon Eliot, CRME, CHA and co-chair of the HSMAI Revenue Management Advisory Board

* Tammy Farley, Principal, The Rainmaker Group

* Neal Fegan, Executive Director of Revenue Management, Fairmont Raffles Hotels International

* Rhett Hirko, CRME, Director of Revenue Analytics, Hyatt Hotels & Resorts International Operations

* Jay Hubbs, Director Hotel Supplier Relations, Expedia Partner Services Group / Hotwire

* Burl Hutchison, CRME, Director of Revenue Optimization, Sabre Hospitality Solutions

* Klaus Kohlmayr, Senior Director, Consulting, IDeaS Revenue Optimization

* John LeCoz, CRME, Regional Director of Revenue Management, Loews Hotels

* Mark Molinari, CRME, Corporate Vice President of Revenue Management and Distribution, Las Vegas Sands

* Orly Ripmaster, CRME, Senior Analyst, STR Analytics

* Scott Roby, CRME, Vice President, Revenue Management, Evolution Hospitality

* Chinmai Sharma, CRME, Vice President, Revenue Management, Wyndham Hotel Group

* Susan Spencer, Market Director - N. America, ChannelRUSH

* Trevor Stuart-Hill, CRME, President, Revenue Matters

* Paul Wood, CRME, CHBA, Vice President of Revenue Management, Greenwood Hospitality Group

Want to Learn More?

This topic will be addressed as part of the 10-part Revenue Management Webinar Series produced by the HSMAI University in partnership with HotelNewsNow and STR. Beginning February 21, 2012, and going through December, each month a webinar will cover various aspects of cutting edge revenue management in today's economy in conjunction with articles written by members of theHSMAI Revenue Management Advisory Board. If you're not able to attend a live program, archives are available. Also, these and other timely revenue management topics will be the focus of the HSMAI Revenue Optimization Conference, co-located with HITEC, June 25 in Baltimore, Maryland.

Nominations are open for the HSMAI Americas Revenue Management Professional of the Year Award, co-presented by HSMAI and Rainmaker. The award recognizes and promotes excellence in the field of revenue management in the hospitality industry. Nominations, which close April 13,Âfor the award come from HSMAI chapters and the industry at large, and nominees represent the very best in revenue management. From nominations received, two (2) finalists will be determined and notified.

Janelle Cornett, Corporate Director of Revenue Management, Coastal Hotel Group, received the HSMAI Revenue Management Professional of the Year Award at HSMAI's 2011 Revenue Optimization Conference. Cornett received the award from Scott Roby (left), CRME, Vice President, Revenue Management, Evolution Hospitality, and chair, HSMAI Revenue Management Advisory Board, and Bob Gilbert, HSMAI President & CEO.

The finalists will receive a complimentary registration to the HSMAI Revenue Optimization Conference in Baltimore, Maryland (June 25, 2012) where the winner will be announced.ÂThe HSMAI Revenue Optimization Conference (ROC), co-located with the annual HITEC show, is a one-day interactive program that discusses cutting-edge trends and best practices for companies in regard to revenue management including challenges, solutions and strategies to guide revenue optimization professionals.