A hotel revenue manager and wider revenue teams drive successful business operations for hoteliers, irrespective of whether they work on-property, as part of a centralised team or remotely within an outsourced revenue management company. They are most frequently found working within large hotel brands and though they are found in independent hotels too, there are still many properties that believe the cost of acquiring such specialist expertise to be prohibitive.
In this article, we explain the role of a hotel revenue manager, the value that they can add to your hotel, inn or serviced apartments, how you can reduce the costs involved and more!
What Is A Hotel Revenue Manager?
A hotel revenue manager is primarily responsible for implementing day-to-day revenue management processes and strategies, for the purpose of maximising revenue for one or more hotels and they typically report directly to a general manager (GM), senior management and/or ownership.
This role is crucial for hotels and accommodation providers, because without dedicated revenue management expertise, they may struggle to achieve their desired revenues.
The Responsibilities Of A Hotel Revenue Manager
A hotel revenue manager is ultimately responsible for devising and subsequently delivering a revenue strategy that will enable a property to realise its true revenue potential.
Role-specific tasks include:
- Identifying booking patterns; competitors; costs; customer behaviour; demand; market trends and new revenue-generating opportunities
- Creating forecasts, special offers and tactics
- Managing channels, inventory, online travel agencies (such as Booking.com & Expedia), prices, profitability, rate parity and restrictions
- Configuring and leveraging technology to improve performance, utilising automation that can support all the above activities
- Providing regular property-level business reporting that includes key performance metrics and recommendations to the GM, senior management and/or ownership
- Selecting distribution partners
They must also be a proficient collaborator, communicator, leader and influencer who can interact with colleagues at multiple levels in all departments – the latter of which is very much a common requirement for any role within the hospitality industry!
What Are The Benefits Of A Revenue Manager?
Having a revenue manager on-property or from an outsourced third party is one way of ensuring that your property remains focused on achieving its revenue goals.
The key benefits of a hotel revenue manager include:
- Ability to leverage their networks and long-term partnerships, access new markets, ensure enhanced visibility across all distribution channels and optimise your inventory
- Acquire passion, perspective and valuable support to all departments from an individual who can serve by building stronger relationships between departments through fostered collaboration
- Boost sales by creating and implementing competitive, innovative pricing strategies which help to build brand awareness, improve profit margins, maximise revenues and reduce costs for properties
- Enable GM’s, senior management and owners to focus on providing memorable experiences for their customers and a platform from which hotels can look to establish their competitive advantage
- Establish opportunities to automate repetitive, time-consuming tasks with integrated technological solutions for greater efficiency
- Increase understanding of what customers expect, need and want, leading to improved customer satisfaction and consequently their loyalty
- Proactive analysis of key performance indicators
What Makes A Great Hotel Revenue Manager?
Revenue managers perform a business-critical, multifunctional role which consequently requires a diverse skill set, industry experience and strategic thinking. When appointing or hiring a hotel revenue manager here are the key traits to look for:
A great revenue manager is accessible to colleagues, adaptable, authoritative, highly numerate and a progressive, big-picture thinker who will challenge conventional wisdom with a commercial mindset. They will also be competitive, spend time cultivating relationships and monitoring industry trends, are detail oriented, determined and a great listener who, as a team player, will proactively solicit input from internal stakeholders.
Furthermore, in addition to the experience that they will already have accrued in revenue management, revenue management systems and related technologies, they will also likely have served as a member of an operations team in the past. The latter will assist in successfully communicating their decisions in regard to, for example, pricing and length-of-stay recommendations to GM’s, senior managers and/or owners in such a way that they are willingly adopted.
The ability to anticipate what the property is going to require to realise its true revenue potential and navigate accordingly, to analyse and subsequently understand data, to articulate, implement and organise ideas and strategies, to convince, observe, negotiate with, network with and persuade others, to manage people, prioritise time and a capability to work well under pressure are all valuable skills of any great revenue manager.
The On-Property Hotel Revenue Manager Role
An on-property hotel revenue manager works within the hotel on a daily basis, their place within the management structure varies from property-to-property and whilst they have, historically, reported to sales and/or marketing, today, they tend to operate at the same level, reporting directly to the GM, senior management team and/or ownership and typically receive a salary in the region of £30k – £70k – primarily dependent on experience and/or location.
The Advantage Of The On-Property Revenue Manager
The advantage of having an on-property revenue manager is the inevitability that they should consistently interact, on a face-to-face basis, with both other departments and the operational team within the property, which should serve to build trust. It should also ensure that revenue management remains at the forefront of your business and facilitate a continued focus on any unique requirements that your property has.
The Challenges Of The On-Property Revenue Manager
A key challenge for hotel owners and GM’s is attracting and hiring an experienced revenue manager with the requisite skills to maximise revenue. Should you be successful in that respect, you then must ensure you retain them, which, for a single property, can prove difficult when most often harbour ambitions of managing multiple properties.
For those hoteliers that have both multiple properties and revenue managers, with varied experience and skills, it can be challenging to implement a consistent revenue strategy and ensure that all of your revenue managers have ongoing access to education, support, training and tools.
However, the greatest challenge is often the human resources (HR) budget and the cost associated with employing a full-time revenue manager, despite the return on investment that they can generate, with it not necessarily considered commercially viable for every property.
The Outsourced (Third-Party) Revenue Manager Role
An outsourced (third-party) revenue manager largely operates remotely but does visit the property on a pre-determined schedule. They typically report directly to the GM, senior managers and/or ownership, providing a fee-based outsourced revenue management service which allows the property to obtain specialist expertise at a fraction of the cost of employing an on-property revenue manager.
The Advantage Of The Outsourced (Third-Party) Hotel Revenue Manager
The advantage of an outsourced (third-party) revenue manager is that due to the reduced cost, it enables a property that may not have any on-property revenue management expertise with an opportunity to acquire a revenue manager who can implement processes and strategies to maximise revenue, without incurring the expense of hiring a full-time revenue manager. You can also benefit from the input of a dedicated expert who is focused exclusively on revenue strategy and look to acquire the best talent, irrespective of their geographical location. Furthermore, staff turnover becomes the responsibility of the third-party company, who may have several experts they can potentially assign.
The Challenges Of The Outsourced (Third-Party) Hotel Revenue Manager
An outsourced revenue management service can sometimes be met with a lack of trust or scepticism. For example, not all properties will want to share their revenue manager with other properties. Some may also fear that their revenue strategies may be shared with competitors and GM’s, senior management and owners may worry that they are ceding control of their revenue management strategy to a third-party. It can also prove difficult for an outsourced revenue manager to build trust with the operations team and other departments within the property, so when searching for an outsourced revenue manager, finding the right character and somebody who can provide a friendly extension of your on-property team is essential.
Find A Great Hotel Revenue Manager
At MavREV, we are set up to provide a complete, outsourced revenue management service and serve as a friendly, proactive addition to your on-property team. So, whether you wish to maximise your occupancy, achieve a more profitable Average Daily Rate (ADR), or reduce the time you spend managing your distribution channels – we can help! Get in touch with us today to book your free revenue management audit.