When I was growing up, color TV was an essentially a commodity. We even started to have something called a VCR. TV’s whilst in color were clunky, VCRs were just another clunky box underneath – however, it provided the first glimpse of freedom at that time as you were able to schedule programs you wanted to record (clunky, but it did the job).
Here is the amazing thing – Friday night was something the family looked forward to. As we would receive the magazine on Thursday, we would have discussions around “what movie to watch”. We had to decide as a family as we could only watch one movie at one channel. Back then there was six channels that were typically wrestling for the top spot – and the winner would get us “brickwalled” for about 90 mins.
Crazy to think that a TV program could make you be at a place in a certain time. How was that possible? Well, you could argue that back in the day the most important job at Television was deciding what program to show at what time as it would capture the consumer and how to “present” a small extract to get you hooked. For us – it was a “date” with the TV, a Friday night thing, a time that was planned.
Wondering about the parallel to Revenue Management? Here is what happens in most hotels:
Daily – RM comes in, runs pick up report, prepares morning meeting numbers, prepares “the story to tell”, comes back to do an hour of pricing. If unlucky, GM is already in asking you “what happened?” a question that at that point in time you are not able to answer.
Weekly – Revenue meeting – dedicated time to bring everyone together to talk revenue
The above is not uncommon and gives the RM the same “power” as to what “movie to watch”. The RM follows the “program” – come in, do pick up report, tell people about it – a morning ritual, a copy and paste exercise that rivals the holy grail. Information shared is solely at the mercy of the revenue manager.
Weekly revenue meetings are nothing else than the Friday night movie night – however in this case, the RM decides the movie and dictates what to “watch when”. There is only one program, one channel. The numbers are set in the same format every week and the importance of a “revenue meeting agenda” is highlighted in every training you go to – even if you have weekly variations of focus areas, more often that not you are running the same movie repeatedly.
And then there is Netflix.
My family and I went to Bali for a weekend trip. Arriving at the hotel the kids were tired after the trip – if you have a five and a three-year-old you know that tired, hungry kids coupled with unfamiliar environment is a highly explosive emotional environment to be in. We decided to switch on the TV as a reward for being amazing little travelers. However, try and explain to a five-year-old the concept of TV channels / programs in a world of on demand on device Netflix streaming that they are used to from home.
We decided to give a phone to Rafa (5) and the iPad to Hayden (3) …oh boy – my Netflix subscription did not cover enough devices which left Rafa empty handed (Hayden was just a bit faster on the Peppa Pig). Remember: Tired, Hungry, don’t get what I want = tantrum.
This situation taught me two important things:
- The way we deal with information has changed: it is now at the time we want it, at the device we want it, on demand – fast-forward, start again, continue where you left off: as often as you like.
- Paying $2 a month more for simultaneous device usage is 100% worth it. Ability to upgrade the plan within seconds and making use of it – priceless. In pricing, we would call that “Versioning”.
“Netflix” your Revenue Management Culture
The biggest barrier for the creation of a revenue culture is: Rigorous tasks and static meetings.
If you are currently living in a revenue world where you are dominated by rigorous tasks and unproductive meetings – great agenda, loads of talk, little action (most people know that I never showed up to my own revenue meetings, and I was supposed to run them) – then it is time to change now.
Imagine an environment where the full-on meeting is split into
Two tips to get you started:
- On demand revenue meeting challenge: Get off your backside, grab any staff member and try and run a revenue meeting RIGHT NOW! Few possible outcomes: A) you can do it, B) you feel lost, C) you are not able to do it, D) staff member think you went “coocoo”
- Price in the moment: Spending two hours each morning to do your pricing is not going to help you. It slows you down. It is wasted time to do everything at once. Instead of tackling all at once – break it down into little chunks across the day (chances are your insights will skyrocket). Imagine it like a box set series. Whilst there are times where you binge-watch, more often than not you take each episode as it comes (and if you mix it up and watch multiple shows at same time – Good, continue!)
Truth is we are lacking agility and speed of decision making. Whilst tasks and structure are important if you are in your infancy of revenue management – a true culture can only be bread across the organization if you bring it into the 21st century – mobile, mobility, on demand!
VP, Asia Pacific
Phone: +60 12 2706 897
LodgIQ™ provides advanced travel industry revenue optimization technologies. Its breakthrough next-generation revenue optimization platforms, LodgIQ RM and LodgIQ ONE, were developed by seasoned revenue management executives and Silicon Valley technologists. LodgIQ”s products combine sophisticated machine learning with an intuitive and powerful user interface delivering advanced recommendations and actionable analytics. LodgIQ RM is for full-service hotels while LodgIQ ONE is geared to boutique, independent and focused service hotels. LodgIQ is headquartered in New York City, and maintains offices in Silicon Valley, Singapore, London, and Bangalore.