Revenue Management can be difficult, but the benefits of having the owner, market and tooling knowledge discussed in this series centralized in-house is what will make this challenge much more attainable. Data insights into market trends can either prove or disprove owner expectations. Owner pricing demands can be effortlessly and quickly implemented in PMs and Pricing tools. And data and comparison tools can reveal market and listing performance. The synergy of having this knowledge together makes a successful Revenue Manager for tens to hundreds of listings.
Focus Your Time and Energy on What Matters Most
Our industry tends to think that unless a Revenue Manager has a wildly complex min stay schema or uses every customization available on all listings, they are not doing their job. What they should be focused on, however, is the bottom 20% of their listings that are going unbooked.
Focus on the basic metrics that are actionable. Consider, for example, “forward looking occupancy.” It is wonderfully simple. The past is history, and while comparing YTD revenue performance may be important to owners, it doesn’t help you make more revenue. It just quantifies what has already happened. Quickly scan the 30 and 90 day occupancy of each listing on your program to make sure none are at the extremes, and if so take action. But comparing future rates to historical rates does not matter if you are going unbooked, period.
Automate and Simplify
After you’ve simplified the metrics you look at, simplify your workload by offloading it to the software you have in front of you. Not having “time for revenue management” because of repetitive tasks should not be an excuse for not driving your revenue management strategy. Consider the following:
- If you sit down to do rates for next year, use rolling calendars instead.
- If you manually reduce min stays as time gets closer, utilize automatic gap filling.
- If you’re manually searching and replacing rates on “Orphan days,” or you’re constantly changing your last minute discounts by hand, automate these activities.
These are just a few examples of what software and pricing tools can do. You can even set up in bulk so there is even no upfront time cost. Automate the repetitive stuff!
Don’t Work Harder, Work Smarter
While tools will save you time, a busy—and successful—PM will simply never have enough. And that’s OK. Think how you can work smarter and more efficiently. Here are some tips that we’ve seen work:
- Be proactive. Reviewing September performance in October will tell you what mistakes you made (or hopefully didn’t make), but it won’t stop them from happening.
- Small, smart, and targeted pricing changes make a difference when done regularly. At the beginning of the week, log into your data provider, see what listings are underperforming, and use the tools to take quick action to lower their rates 5%. Let the change take effect.
- At the end of the week, log back in and review forward portfolio occupancy and tweak the dates that are passing too fast or too slow accordingly.
If the above steps are done consistently and methodically, it’s really all you’ll have to do to have a stellar year!
Let’s Wrap This Up!
Revenue management may seem daunting, but it’s really not. There’s even a high likelihood that you or a capable member of your team are already doing all or part of revenue management, even if they don’t have a corresponding title.
It’s important to assign clear roles and be deliberate about leveraging that person’s knowledge of owners and markets. There is no one outside of your company that will know about your owners and how to manage and serve them better than you!
Next, take the time to review your software toolkit to see how much time and effort can be saved, as well as prioritizing revenue-generating tasks and not just reporting for reporting’s sake. Revenue management in the vacation rental industry has come a long way to make you your best revenue manager.
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