Revenue Management
Then and Now
The introduction of revenue management into the hospitality industry is a relative new comer to the game but its role has grown in importance exponentially over the last 15 years. Not only has the status of Revenue Manager grown the role has evolved into one almost entirely different than its inception.
Wikipedia defines “Revenue Management as the application of disciplined analytics that predict consumer behavior at the micro-market level and optimize product availability and price to maximize revenue growth. The primary aim of Revenue Management is selling the right product to the right customer at the right time for the right price and with the right pack”
The idea of revenue managers being solely an almost personality free number crunchers sitting behind a closed door has drastically evolved. The days of reporting to the sales team with analytics has gone While roles within the industry differ depending on the property ownership and overall scope It is often times no only a numbers game driven by simple baseline analysis of market trends the DORM (Director of Revenue Management) is now on a tier on par with GMs and often times surpassing the executive team. Ownership has placed a large emphasis on the role and with this DORM’s are now expected to be experts in Marketing, SEO, at the forefront of technology and are often the first person both Ownership and management turn to for explanations solutions. With this there is a strong need for the next generation of Directors of Revenue to have a level of sophistication, communication and resilience to enhance the strong analytical skills to persevere.
Individuals striving to succeed in revenue management need keen analytical minds, exceptionally high emotional intelligence and a slew of other qualities such as critical thinking, the persuasiveness of a politician and the ability to be think strategically and accurately in high stress situations.
Todays Revenue manager is now expected to optimize all levels of the hotels success from top line revenue to EBITA, from SEO and Marketing to managing monthly P&L meetings. It is evident that over the 30 years its been in existence the discipline has made huge leaps and will continue to mature and evolve. The opportunities for talented analytical individuals that posses a thick skin and a realistic sense of self and emotional intelligence are endless in this young discipline.