As a hotelier in today's competitive hospitality industry, it's essential to overcome multiple challenges to sell rooms at optimal rates to the right guests. It requires selling at better rates than your competitors and increasing occupancy rates at your property. Now, we all know that hotel revenue management plays a crucial role in achieving this goal. However, in this blog, we will explore one of its key components - Hotel Rate Shopper.
What is a hotel rate shopper Tool?
Hotel rate shopper tools, also known as hotel rate shopping tools, are software solutions that enable hoteliers like you to monitor and analyse the room rates of your competitors in real-time. With this, you gain valuable insights into market trends, competitor pricing strategies, and demand patterns. Simply put, you can competitively price your rooms per the local demand so that you don't leave money on the table at the end of the day.
The history of rate shopping for competition monitoring
Many airlines began using rate shopping software to monitor the prices of routes with rival carriers. It helped them adjust their prices to remain competitive and boost their revenue. This approach was successful and has now been adopted by other industries. However, it's worth noting that major hotel chains in the hotel industry have employed their proprietary rate management software to monitor rate parity across various sales channels.
How does a hotel rate shopping tool work?
A hotel rate shopper tool constantly monitors your hotel's rates and those of your competitors across various online distribution channels - OTAs, GDSs, metasearch engines, and their brand websites/booking engines. It employs sophisticated algorithms and data analytics to analyse this information. Now, when you know how your competitors are selling with more or less the same amenities, services, and star category, you can indeed work on your pricing strategy, right? For example - if one of your direct competitors is selling its rooms at Rs 4600 during a sporting extravaganza and your rate is still at Rs 4350, you can increase your rates to take advantage of the opportunity to make money.
The tool analyses your competitors' pricing strategies, such as their room rates, room types, availability, and restrictions. It also tracks the market demand and provides in-depth information on upcoming events, local festivals, and holidays that might affect demand. And, of course, when demand increases in your locality, you will increase your rates like your competitors. But then you can't track those insights manually. Hence, it would help if you had a hotel rate shopper tool to do the job.
Features of a hotel rate shopper tool
With a rate shopper, you can confidently stay ahead of your competition by utilizing precise data to improve your pricing game while getting everything right.
- Real-time rate tracking: It should help you see your competition's live rates in real time. Some advanced tools also offer insights into room types, restrictions, and availability.
- Size of the compset to be tracked: The rate shopping tool should allow tracking of at least ten hotels to maximize benefits.
- Shopping across leading online channels: This is one of the most essential features. Check if the solution can scrape and gather data from all major online platforms, including OTAs, GDSs, and metasearch engines.
- Market demand analysis: The tool tracks the market demand and provides insights on upcoming events, local festivals, and holidays that might affect demand.
- Rate parity monitoring: It should be able to track your compset's rate parity across online sales channels.
- Hotel PMS integration: A good hotel rate shopper tool should integrate with your Hotel PMS, allowing you to compare historical and live data.
- Customizable alerts: The tool should allow users to create alerts for specific market changes, such as competitors' rate fluctuations or shifts in demand.
- Online ranking and review score of your compset: Oh yes, this is also very important for you to track. It's mainly because a hotel's online rankings and reputation directly impact its pricing strategy.
- Reporting: You must pay attention to this aspect. The hotel rate shopper tool should represent all data clearly and comprehensively via an interactive dashboard, enabling you to analyse it efficiently.
- Device agnostic: You or your revenue manager should be able to get all relevant data on devices of your choice - from smartphones to tablets and laptops on the go.
- 24/7 support: We don't have to stress more on it. Choose a solution provider that offers prompt 24/7 support so that you can make the most out of the rate shopper solution.
Benefits of a hotel rate shopper tool
With the advancement of technology in the last decade, many independent properties have started using hotel rate shopping tools to gain the required pricing intelligence.
- Accurate rate intelligence: You get instant and precise rate intelligence on competition pricing. This helps you make informed pricing decisions to sell your rooms at the best rates for improved RevPAR and overall revenue. It also lets you know your competition's online ratings and reputation.
- Competitive advantage: You can stay ahead by selling your rooms at competitive rates at the right time.
- Time-saving: You can save significant time as the solution monitors your compset. Plus, it makes the whole process error-free.
- Improved efficiency: By automating the process of monitoring and analysing the compset's live rates, you can improve your revenue management team's efficiency.
The competitive landscape in the hospitality industry is constantly and rapidly evolving. Technology adoption among hotels has been on the rise. In this context, it becomes challenging for you to beat the competition if you don't have the right intelligence on their pricing strategy. That's why hotel rate shopper software has emerged as one of the operationally-imperative tools to help you work smarter when it comes to selling at the best rate.
