Yield Management Adjustments

Most customers use the Yield Management module to establish rate plan cutoffs well into the future. For example, they may establish seasonal rates and cutoffs for the summer during a meeting in January. However, these future settings are usually only a “best guess” of what rates to offer on each summer day.

To maximize the benefit of RDP’s Yield Management module, rates and cutoffs must be reviewed frequently. For example, your property may have always sold out on the July 4th weekend, and as a result the only available rate is “RACK”, and it is set very high. However, as the 4th of July approaches it is critical to monitor actual bookings and make adjustments to available rates based on actual bookings.

RDP offers a wide variety of reports to show projected occupancy, including comparisons to the projected occupancy at the same point in time the previous year. (see “enhanced forecasting”). Using these reports the rates and cutoffs can be adjusted to maximize occupancy.

One RDP customer has a large airport hotel. On a given day they may have projected only 50% occupancy and therefore have many discount plans available on the yield management screen. However, fog moves into the area and flights are starting to be canceled. The yield manager at the hotel eliminates all discount rates for that day. Several hours later the fog lifts and the airport is fully operational, so the yield manager re-opens the discount plans.

This particular customer specializes in purchasing properties with a low occupancy and ADR. With careful study of the property’s history and RDP’s yield management, both occupancy and ADR are increased and the property is sold at a significant profit in a few years!

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