So, you are thinking of moving to a different and more effective revenue management system (RMS) for your hotel or hospitality organization.

But you have doubts.

Maybe you are catching yourself thinking:

  • It is too expensive to install a new RMS for my hotel or hospitality organization.
  • It takes up my staff’s precious bandwidth (and they’re already minimized).
  • It will take too long for my new revenue management system to learn how to price effectively.
  • It’s easier to stick to the RMS that I know of. It is “good enough”.

If you find yourself worrying and wondering about the concerns listed above, it is comprensible.

But here’s the reality: Those concerns, however well-founded, are based on common myths.

Don’t let these myths cause you to miss your chance to move to a more productive and useful hospitality revenue management solution.

To help you upgrade to a better RMS hotel, we’ll go over the four most common RMS switching myths so you know what to look for.

Let’s begin.

Four myths about moving to a new RMS for your hotel or hospitality organization: Source: IDeaS
Four myths about moving to a new RMS for your hotel or hospitality organization: Source: IDeaS

Myth No. 1: It is financially too expensive to install a new revenue management system

While there are costs involved in adopting a new RMS, there are also costs to maintain the status quo.

If your current revenue management system causes you to lose market share gains because it cannot produce accurate room-level pricing, then this could cost your business more than if you switched to a better RMS.

If your current RMS struggles to accurately manage and evaluate the group’s assets in a way that fully optimizes revenue, you could also lose money in the long run.

Here’s a fact: Hotels with an RMS that they rate by room type (such as IDeaS G3 RMS) experience a 5% increase in revenue compared to other tools that cannot rate by room type.

Four myths about moving to a new RMS for your hotel or hospitality organization: Source: IDeaS
Four myths about moving to a new RMS for your hotel or hospitality organization: Source: IDeaS

Myth No. 2: learning a new system will take up too much bandwidth for my strained team

Many teams experience a slight drop in overall efficiency when switching to a new software solution.

However, this decline is typically short-lived.

Here’s the truth:

Even with limited staff, onboarding a new RMS has never been like this faster or easier on the side of the hotel.

Self-paced learning allows employees to conduct onboarding when it makes sense for them and their programs.

Meanwhile, analytics and automation handle the heavy lifting of system setup and configuration.

And once your advanced RMS is up and running, efficiency and productivity accelerate.

When comparing productivity while using an automated RMS to productivity when using a rule-based pricing tool (or spreadsheet), you are likely to experience a huge increase in productivity from a automated system.

Four myths about moving to a new RMS for your hotel or hospitality organization: Source: IDeaS
Four myths about moving to a new RMS for your hotel or hospitality organization: Source: IDeaS

Myth No. 3: It will take too many months for a new RMS to provide accurate predictions and prices

When you hire a new employee, it takes some time for them to learn their role and how your company works.

But when you implement a hotel revenue management system like G3 RMS, which has been rolled out across thousands of properties, you get a ready-to-use system that’s ready to make a difference right away.

The artificial intelligence in G3 RMS allows it to adapt as needed and to continuously know the new property in which it is installed.

Without supervision or programming, G3 RMS adjusts and applies pricing models that maximize the full potential of each revenue stream in a given location.

Having learned from thousands of hotels and resorts, a revenue management system like G3 RMS is constantly improving its algorithms as it progresses.

This ongoing fine-tuning ensures that RMS’s predictive forecasting approach best matches your property’s demand patterns so that forecasts and prices are aligned with changing market conditions.

Source: IDeaSSource: IDeaS
Source: IDeaS

Myth No. 4: it’s easier to stick to what I know (and easier not to change)

Imagine if everyone kept using the horse and the stroller or the typewriter instead of switching to a car and a personal computer. Giving up on this technology would have meant giving up living a more productive life.

So, yes, it’s easy to stick with your current RMS. This requires no extra work. But it might not lead to extra profits or growth either.

And in the long run, sticking to an RMS that requires near-constant rules programming and reprogramming could cost you more time than if you had switched to an automated system previously.

Think about this: Are you really saving time by constantly reprogramming the rules?

Or would you benefit more from a system that operates independently of rules and supervision?

The bottom line is this: If you can switch to a technology that produces insights without asking for confirmation and make the necessary price changes without you checking it, you will save time in the long run.

This is where the industry is moving in the same way society has moved on from horse-drawn carriages and typewriters.

Source: IDeaSSource: IDeaS
Source: IDeaS

Four features of a hospitality RMS you should be looking for

Now that you know what myths to look out for, you can now focus on identifying the right features of a revenue management system for your hotel organization.

There are four basic characteristics an RMS should have for your hotel or hospitality organization to effectively manage revenue. These features include:

  1. Versatile pricing: The best way to maximize revenue is to make sure your organization captures business from the most profitable groups and individuals by offering them the ideal price. Automated RMS for hotels should help hotel organizations confidently adjust prices and remain competitive under all circumstances.
  2. Proactive forecastingPredictive analytics in an automated hotel RMS should pull data from multiple sources and historical records to understand price and demand patterns, length of stay, and booking behaviors.
  3. Manage by exception: The Ideal Hotel RMS automates basic manual tasks associated with revenue management (such as browsing old spreadsheets to find ideal prices). This feature gives hoteliers more time to create revenue strategies and more insights to make decisions that drive long-term revenue growth.
  4. Maximize groups: The right RMS for the hotel allows sales managers to quickly and efficiently decide whether a group event will earn the hotel more money than if the hotel held the same rooms for transitional activities. Once a hospitality sales representative has entered the details of a request for proposal (RFP) into the ideal RMS, the system analyzes the expected wash, demand patterns, incidental expenses, and expected profit from both the group and the from the relocated business as a way to set the ideal price point that maximizes profits.

So, now you know the four hotel RMS myths to watch out for and the four crucial characteristics of a revenue management system for hospitality organizations.

This means you are well on your way to helping your organization save more time and earn more profits.

But if there’s still more you want to learn about how to create a case for switching to a different RMS, check out our step-by-step guide to introducing a revenue management system to your peers.

This guide will give you the tools you need to take an airtight step and convince stakeholders in your organization that it’s time to make the switch.

Source: IDeaSSource: IDeaS
Source: IDeaS

Here is the bottom line

As legendary ice hockey player Wayne Gretzky once said about his unique approach, “Skate where the puck is going, not where it has been.”

When applied to the hospitality industry, the same principle applies.

You can’t risk staying true to the status quo by doing what you’ve always done.

Your guests and competitors are evolving the way they operate. Your organization will also benefit from the evolution.

Here, staying ahead means partnering with established leaders who continually deliver first-to-market capabilities.

Innovating with the guest experience and RMS technology will put you in a spot where the metaphorical puck is going so you can score the winning goal.

Are you thinking of making the switch? We can help

Whether you are looking for more benefits for a revenue management system or want a way to engage your colleagues in the transition, we can help.

Download our The ultimate buyer’s guide to rethinking revenue management in today’s hospitality industry to find out more benefits of using an automated revenue management system for your hotel or hospitality organization.

Four myths about moving to a new RMS for your hotel or hospitality organization: Source: IDeaS
Four myths about moving to a new RMS for your hotel or hospitality organization: Source: IDeaS

About IDeaS

IDeaS, a SAS company, is the world’s leading provider of revenue management software and services. With over 30 years of experience, IDeaS provides revenue science to over 18,000 customers in 145 countries. By combining industry knowledge with innovative data analytics technology, IDeaS creates sophisticated yet simple ways to provide revenue leaders with accurate and automated decisions they can trust. Results delivered. Revenue transformed. Discover greater profitability on ideas.com.

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