How to Maximize Hotel Revenue During an Occupancy Drought

In hospitality, when it rains it pours. There might be days when your overbooking strategy has gotten way out of hand and you end up having to redirect so many guest prospects that you end up asking yourself, whether you should finally expand and add a second location. On the other hand, there are also those days, when it seems like the rain will never come.

Low season is the unfortunate side of hospitality, with occupancy dropping so low that room rates drop from anywhere to 20 or 30%. And sadly there isn’t much that can be done to generate spontaneous interest in your property, so in order for you to be able to make a profit in the off-season, you will need to plan for it well in advance.

Starting with:

Guest Loyalty
Loyalty programs are one of the most useful practices employed by hoteliers. A loyalty program for frequent visitors allows hoteliers to profit off certain guest demographics such as business travellers, and explorers, but in order to incentivize them to travel for the purpose of staying at your hotel, you need to find an angle that would appeal to your most loyal demographic. Consider their reasons for travel in the first place:
  • Meetings with potential clients
  • Summits
  • Conferences
  • Seminars
  • Retreats
In order for you to utilize their loyalty in the off-season, you need to consider expanding your services to those of an event organizer. Essentially, if the guests have no particular reason to visit, you are going to provide them with one. Most of the above-mentioned events would require contacting various corporate clients and offering your premises for event purposes at a discount.
If you manage to do this in advance you might be able to secure at least three or four such events, which will definitely help our revenue-wise. Some hoteliers might feel reluctant to approach guests with such offers, mostly out of fear of losing out on some last-minute wedding or family reunion booking. But even if that is the case, the odd event would not make up for the lack of business the rest of the time.
Unlike the more profitable parts of the year, when you can never be certain what to expect and prepare for, the low season is fairly easy to spot, and it takes the same intermittent time of the year when casual visitors are few and far between and loyal guests have less business for you. Avoiding to prepare for it will do no one any good.
Take on Strategic Partnerships
While you can never be certain whether your approach to guest loyalty will pay off during the offseason, you might find a more reliable source of revenue generated from a lucrative partnership. Just because your hotel may not generate interest during this time of year, does not mean it’s the same for other businesses.
Research well in advance upcoming local events and approach the organizers with an offer for reduced room rates if the participants in the events decide to book with you. Making an offer several months in advance would allow you to showcase the true value of your rooms and juxtapose it to the rate they will be receiving.
If your hotel is not within the range of the event being organized, but it is also not in a completely unrelated part of the city, then you can work in a transfer to your establishment. The more accomodating the conditions of your partnership the more likely that it will be a profitable one.
Room Rate Management
Lowering room rates can be tricky, go too low and you lose out on much-needed revenue, stay just under your usual rates and you risk guests passing you over for the competition. Comparative data analytics is a necessary part of room rate management, and for that, you will need the right tools.
Your property management system should be able to provide you with automated revenue management, a machine-learning solution which actively analyzes your hotel’s data, both historical and the one actively being added to its systems.
By analyzing both old and new room rate data your automated revenue management system will always be able to generate the best possible room rate for a specific period of time. This same data can be managed through your PMS’s direct channel manager and updated simultaneously across all distribution channels. By always knowing how to properly price your rooms you are unlikely to lose out on business and revenue due to mispricing your services.
A Guest Persona for the Off-Season
Guest personas are intended to generate an image of the ideal guest segment for your hotel, with loyalty being the objective. But if you reshape the objective to meet the demands of the low season, then you get a new kind of guest, who would be invested in your property during its lowest point. It is key to note here that a guest persona for the off-season is not meant to generate loyalty, but rather spontaneous interest.
By using the data in your hotel PMS you can establish a certain pattern in guest spending and booking habits. Once you have narrowed down the specifics of such a group you can prepare a marketing strategy, suited with the right guest package deals to attract your lucrative temporary guest base.
Paid Social Media Advertisement
Investing in marketing for the low season is one of the few effective ways for you to guarantee higher occupancy. While most advertisements tend to appeal to the idea of generating occupancy at higher room rates, you are now trying to do the opposite, generate interest at the appropriate for the season rates.
Remember, that every day you run an operation without booking out you are effectively lowering your profit margin for the year. Investing in your lowest season might be just what your hotel needs in order to improve occupancy and generate higher revenue.
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About Clock Software

Clock Software is a global provider of cloud-based property management systems (PMS), integrated online distribution, online & kiosk hotel self check-in solutions and mobile & in-room guest engagement systems with customers in more than 65 countries.