Business Intelligence (BI) is the process of utilising software and services to transform data into actionable intelligence. This intelligence, in turn, forms the basis of an organisation’s strategic and tactical business decisions. In layman terms, BI helps decision makers to examine data to understand trends and derive insights. Also known as market intelligence, BI plays a very important role in the hospitality industry.
The hospitality industry is in a process of constant change and the management has to be keep itself updated about the developments and market trends. BI helps the decision makers to be proactive rather than reactive to fluctuations in demand and supply. Data is collated from various sources like PMS, OTAs, GDS, etc. This data is then analysed and shared with the decision makers in the form of reports to aid decision making.
The key areas that BI can help hotels in are: Marketing, Price Optimization & Forecasting, Business Operations and Guest Satisfaction. Business intelligence, if consumed in the right manner can help hotels increase profits and online visits, gain customers and turn customers into loyal patrons. The data gathered can help improve the online marketing strategies for the hotel. In this blog post, we are going to focus on the importance of using BI for pricing strategies.
Price Optimization: Hotel room pricing is in a state of constant change and flux. Revenue managers have to monitor the changes in demand patterns and trends in conjunction with historical data and occupancy patterns to determine the daily room rates. Real-time data, a key component of hotel price intelligence, not only includes key insights on competition rates, but also on the inventory available and various promotional activities being run by other hotels and OTAs. Information about the competitor promotional activities (any discounts, schemes, room offers, special packages, etc.) is utmost important, as it gives hoteliers a three sixty degrees view of the market, thereby highlighting opportunities and misses if any.
To conclude, accurate forecasting and pricing decisions have a major impact on optimum occupancy and revenue generation for hotels. BI aids in making those decisions as perfect as possible. At Revnomix Solutions, we have helped our clients (existing hotels as well as newly launched hotels) generate over 30% top line revenue year on year using business intelligence.