Yield Management or Performance Management

Until a few years ago, hotel establishments, especially those focused on vacation tourism, have been working with a few tour operators or distribution channels. Each season the rates and availability of the next season were negotiated with the intermediaries, and for many years the hotels had guaranteed full capacity, which did not require great efforts to market the places or Insights of sales.

This panorama has changed in recent years, and now, in a scenario where contracts with guarantees with intermediaries have been gradually reduced, hotel establishments have launched on the Internet to attract the final customer and also to sell through online agency portals, thus diversifying the distribution of your product in multiple and new sales channels. The squares of many hotels get to be published in dozens of portals, which generates an important need for management and control of sales by these establishments.

Faced with this new challenge, new key questions arise management for hoteliers: How do I know and control How are the places of my establishment sold in multiple sales portals? And even more difficult: How can I know what new rate and availability scheme should I apply in each channel to optimize income and ensure profitability?

Yield Management (YM) is supposed to be the answer to these questions. YM (also called Revenue Management) is an activity (or activities) of management aimed at optimizing income. Find the best price, for the best customer at the best time. To do this, it calculates the optimal rates and availability according to demand. In general, the YM is especially suitable for optimizing sales of products that perish over time (airplane seat, hotel room), and under conditions of variable demand.

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This activity is not new in all sectors, airlines have been doing this practice of management for a long time, and also large reservation systems or hotel chains that have sufficient resources. However, it is the small establishments who, as a result of this new reality on the Internet, and somewhat helpless, are feeling in their own flesh the need to carry out this activity of Insights for control all its sales channels. So important is it turning out and so serious are some taking it, that in many hotels in the Balearic Islands new jobs are appearing specifically focused on control the establishment's sales on multiple Internet portals.

Regarding the tools available in the market to support YM-related activities, there are some outstanding sales channel managers: such as the product suite RateTiger; the suite Ideas; ChannelManager from TravelClick and XMLGCV from Homotec.

Published by: Esteve Lladó. Source: Logbook (17.07.06)

I am a dreamer and in my dreams I believe that a better world is possible, that no one knows more than anyone, we all learn from everyone. I love gastronomy, numbers, teaching and sharing all the little I know, because by sharing I also learn. "Let's all go together from foundation to success"
yield Management
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