Room rate parity: A 2010 study of U.S. booking channels

Hotel guests are facing a variety of different hotel rates when booking online. The transparency of the Internet is driving hotel prices towards rate parity. This study investigates room rate parity, room and hotel availability, price consistency, and rate guarantee. The study examines 240 property-date combinations, focusing on ten metropolitan areas, using a sample of 120 hotels for two booking dates, and analyzing three hotels per four hotel segments. The results suggest that Orbitz, an indirect distribution channel, is the best choice when booking rooms in budget and midscale market segments. Furthermore, Expedia offers the best room prices for luxury properties. Room availability is still an issue for third-party distribution channels, while a phone call is still the best channel to ensure room availability

CHR Reports Compendium 2003

A compilation of summaries from CHR Reports, articles from Cornell Hotel and Restaurant Administration Quarterly and working papers published in 2002 from the School of Hotel Administration

The future impact of changes in rate parity agreements on hotel chains: the long-term implications of the removal of rate parity agreements between hotels and online travel agents using closed consumer group booking models

The Office of Fair Trading, a not-for-profit and non-ministerial government department of the United Kingdom (from April 2014 incorporated within the Competition and Markets Authority), investigated the legality of rate parity from 2012, particularly rate parity agreements made between Intercontinental Hotel Group, Booking.com, and Expedia. Consequently, these major hotel brands and agents have committed to remove rate parity for closed consumer groups. This article identifies confusion over such groups and longer term implications. Smaller agents will enter the market, leading to increased fragmentation and competition. Branded hotels will face tough challenges in protecting prices and value from aggressive agents suddenly facing a more competitive market and independent hoteliers able to establish effective relationships with the new, smaller agents. Keywords : Rate parity, pricing, closed consumer groups, hotels

Pricing and Revenue Management

The focus of this chapter is on the strategic role of price in revenue management (RM). In order to successfully use price as a strategic weapon, firms must address two questions: what prices to charge and how’ to determine which customers or market segments should be offered those prices. In addition, companies must study and understand both customer and competitive reaction to their use of RM pricing. In this chapter, I address these questions through a review of the relevant literature and of current practice

Information Technology Applications in Hospitality and Tourism: A Review of Publications from 2005 to 2007

The tourism and hospitality industries have widely adopted information technology (IT) to reduce costs, enhance operational efficiency, and most importantly to improve service quality and customer experience. This article offers a comprehensive review of articles that were published in 57 tourism and hospitality research journals from 2005 to 2007. Grouping the findings into the categories of consumers, technologies, and suppliers, the article sheds light on the evolution of IT applications in the tourism and hospitality industries. The article demonstrates that IT is increasingly becoming critical for the competitive operations of the tourism and hospitality organizations as well as for managing the distribution and marketing of organizations on a global scale

Tourism supply chain management : a new research agenda

2008-2009 > Academic research: refereed > Publication in refereed journalAccepted ManuscriptPublishe

Demand Management: Beyond Revenue Management

[Excerpt] Think of yield or revenue management (RM) as the base of a funnel where the demand for services pours into the top is managed using price, terms and conditions, layovers, and length of stay controls to optimise revenue. That process can be carried out with a sophisticated RM system or in a more limited way with an intelligently developed and applied set of pricing and organisational practices. Demand management can be envisioned as both RM and keeping the funnel continuously and cost-effectively full of potential business. Formally, demand management has been defined by Larry Hall, President and CEO of Hotel Booking Solutions as, ‘the art and science of dynamically managing demand to optimise distribution and maximise customer relationships’. More generally, think of demand management as extending the tactical tools of RM to a more strategic level of not just managing demand but creating and directing demand. Used effectively, demand management has the opportunity to create value and avoid the increasing commoditisation of services

Identifying the Optimal Combination of Hotel Room Distribution Channels: A DEA Analysis with a Balanced Scorecard Approach

The hotel industry has experienced changes brought on by growth, customer expectations and the proliferation in the use of e-commerce and online distribution channels. Future hotel success depends on how effectively hotel revenue managers are able to manage all of the different booking channels to maximize hotel revenue. This study represents a new approach for hotels, the use of a Data Envelopment Analysis-Balanced Scorecard (DEA-BSC) model to measure efficiency of distribution channel mix as measured by balanced scorecard results. DEA-BSC was chosen for this study because while traditional business models typically focus on one performance measure like profit, DEA-BSC considers multiple metrics simultaneously (Zhu, 2014a). Inputs for this study included the percentage of rooms sold revenue of five distribution channels including C-Res/Voice, GDS, brand.com, OTAs, and property/relationship sales. Output was consolidated BSC average. Hotels (DMUs) for the study included fifty-three select service hotels managed by a hotel management company with hotels located throughout the United States. Findings indicated that the DEA-BSC model were able to use channel mix as inputs and consolidated BSC average as output to identify efficient (benchmark) hotels and inefficient hotels. Findings also provided measurement and direction regarding the gap between the hotels that were efficient vs. those that were not. The model could not provide information on whether one output was more effective than another in contributing to the success of a hotel (DMU), but findings generated by the DEA-BSC model provided each inefficient hotel (DMU) with benchmark comparison information to assist the inefficient hotel (DMU) to become efficient

Hotel internet marketing channels and purchase decision / Amirul Muidz Amrahi and Salleh Mohd Radzi

This paper aims to investigate the relationship between hotel internet marketing channels and customer purchase decision of 5star hotels in Kuala Lumpur. A quantitative approach used in this paper where instrumentation design was based on previous research methodology. Questionnaires were distributed to all 5 star hotels in Kuala Lumpur official Facebook fan page using an online survey provider. From the findings, it was found that there is a significant relationship between hotel internet marketing channels and purchase decision. This paper only focused on 5 star hotels in Kuala Lumpur, and it is suggested that the study could be conducted covering all 5star hotels in Malaysia for a better scenario of the industry

The use of yield management within the kingdom of Saudi Arabia hotels

The airline industry has successfully adopted yield management (YM), particularly after the industry was deregulated in the late 1970s. In this study, YM is applicable to the hotel industry as a strategy to maximise profits. Thus, it involves the allocation of resources among various customers in hotel rooms relative to the existing market characteristics. In doing so, YM’s core concept is the provision of the right service to customers at the right prices. The aim of this study is to examine the practices and perceptions concerning YM as per the understanding and awareness of hotel managers. The study investigates several Saudi hotels of various sizes that use YM, and it identifies revenue management strategies and general practices within the hotel industry. The investigation took place in seven key areas of the hotel industry: location, occupancy, pricing strategy, price-adjustment strategies, HR management, customer satisfaction and third-party websites. The study involved two steps to achieve its purpose. First, YM practices were investigated in comparison to the seven key areas that influence revenue. Moreover, there was an emphasis on determining whether there was an attempt to manage revenue within the hotel industry. The results from the investigation are presented using a descriptive approach. The second step involved establishing the use of YM as a tool for managing revenue in hotel operations. This shows how revenue management through YM should be conducted. These results are presented using a normative approach. In the methodology, qualitative research is applied. Through this approach, 13 revenue managers and seven general managers from various Saudi hotels in Riyadh, the Eastern Province and Mecca were interviewed. Further, documents and direct observations were used to collect vital data to compare room rates through the use of direct and indirect distribution channels. Here, direct distribution channels involve making direct calls to hotels, as well as the use of official hotel websites. Conversely, indirect distribution channels involve the use of Booking.com and Agoda.com. These different options were then compared to observe the option that was more efficient in revenue management. From the comparison, the results showed that the practices and perceptions of YM were reasonable in the cities’ hotels. Of particular interest was the fact that respondents were aware of some key principles of YM. Consequently, many of these principles had been adhered to in room revenue management. For instance, stakeholders understood the significance of segmenting potential and current customers into various groups. This is critical, as these groups have different priorities, income levels and goals. As a rule, attention focuses on criteria such as ability and willingness to pay. The study recommends strategies that can be adopted by Saudi hotels to overcome the misconceptions and perceptions of YM. For instance, the system must be interlinked with location, occupancy, pricing strategy, price-adjustment strategy, HR, customer relations and the Internet. Interlinking the system with these key concepts is essential to maximise profits in the hotel industry. In essence, this paper offers knowledge to further the research on the applicability of the YM concept within the hotel industry in Saudi Arabia