As hotel owners and managers, we’re always looking for ways to improve our revenue and stay competitive. With the rise of cloud-based and AI-powered Revenue Management Systems (RMS), it’s tempting to think that technology can handle everything. But does having an advanced RMS mean you no longer need a human revenue manager? In this blog, we explain why combining the right technology with a skilled human revenue manager will help you make the most out of your investment.
1. The Growing Importance of Revenue Management in Hotels
Revenue management has become a key part of hotel operations today. With the goal of increasing your hotel’s income in a competitive market, many hotels are turning to advanced cloud-based and AI-powered Revenue Management Systems (RMS). But here's the big question: Is it enough to just implement an RMS, or is there still a need for a human revenue manager to make sure you get the most out of your investment?
In this blog, we’ll explain why having both an RMS and a skilled revenue manager is the best approach for boosting your hotel’s profits.
2. What is a Revenue Management System (RMS)?
An RMS helps you manage your hotel’s room rates and availability in a way that maximizes revenue. The goal is to sell the right room to the right guest at the right time, at the right price. Here's what an RMS can do:
By using these features, RMS can help you increase revenue per available room (RevPAR) and improve overall profitability.
3. The Power of Cloud-Based and AI-Powered RMS
Traditional, on-premise RMS systems are outdated. The cloud-based and AI-powered RMS systems of today are faster, more accurate, and more efficient.
Benefits of an AI-Powered RMS:
- Real-Time Price Adjustments: AI constantly adjusts room prices based on the latest market demand and competitor prices.
- Automated Distribution: It automatically updates room availability across all channels like OTAs, Global Distribution Systems (GDS) and your website.
- Revenue Optimization: AI considers all revenue sources, not just room sales, giving a complete view of your property’s financial health.
While these systems are powerful, they still require human input to get the best results. Let’s take a closer look at this.
4. Can Revenue Management Be Completely Automated?
While technology can make revenue management easier, it cannot replace human expertise in certain areas. Here’s why:
1. Decision-Making Based on Real-World Conditions
- Technology Can’t Always Predict the Unexpected: RMS systems are great at analyzing data, but they can't account for things like local events, sudden changes in demand, or unexpected competitor actions.
- Human Experience: A skilled revenue manager can take these real-world changes into account and adjust prices accordingly.
2. Understanding What Guests Really Want
- Beyond the Numbers: While an RMS suggests room prices based on data, it can’t always predict guest behavior—such as why a guest might choose a longer stay or what kind of promotions might interest them.
- Tailored Pricing Strategy: A revenue manager can use this kind of insight to adjust pricing, offer discounts, and create loyalty programs that appeal directly to guests.
3. Planning for the Long-Term
- AI vs. Experience: AI can adjust pricing in real-time, but it doesn’t offer the same foresight as an experienced revenue manager. Long-term planning—such as adjusting for peak seasons, planning promotions, or adapting to changing guest behavior—requires human judgment.
- Revenue Manager Expertise: With years of experience, a revenue manager can predict trends, plan pricing strategies, and adjust to changes in the market before they become an issue.
5. Key Tasks That Only a Revenue Manager Can Do
While an RMS helps with daily operations, there are still many tasks that require human expertise. Here are some of the things only a skilled revenue manager can do:
Revenue management requires a mix of data analysis and human decision-making, which is why a skilled revenue manager is still essential.
6. Why Both RMS and a Human Manager Work Best Together
The most effective revenue management strategy combines the power of an AI-driven RMS with the insight of a human revenue manager. Here’s how:
- Maximizing Technology: While an RMS provides valuable data, a revenue manager knows how to use that data effectively and adjust pricing based on experience.
- Handling Unique Situations: AI might make recommendations, but a revenue manager can handle exceptions, such as dealing with VIP guests, loyalty programs, or unexpected market changes.
- Maximizing Profitability: The combination of both ensures that pricing and distribution are always optimized, leading to higher profits.
7. AxisRooms: Bringing Technology and Human Expertise Together
For just ₹4999 per month, AxisRooms gives you the best of both worlds—technology and human expertise working together to maximize your hotel’s revenue.
Conclusion: The Need for Both Technology and Human Expertise
In today’s competitive hotel market, the right tools are essential, but it’s the combination of AI-powered RMS and the expertise of a human revenue manager that leads to success. While technology helps with data analysis, pricing adjustments, and forecasting, human oversight is still critical for interpreting the data and making the best decisions for your hotel.
AxisRooms makes it easier for hotels to integrate both by offering an affordable, scalable solution that combines the power of RMS technology with the expertise of a skilled revenue manager. Don’t let technology work in isolation—use both to ensure your hotel thrives.
Key Takeaways:
- AI-Powered RMS helps automate pricing and distribution, but it needs revenue managers to provide strategic oversight.
- Human revenue managers are still crucial for long-term planning, adapting to changes in the market, and understanding guest behavior.
- AxisRooms offers a cost-effective solution that combines RMS technology and human expertise, helping you maximize your revenue potential.
Investing in both technology and expertise will ensure that your hotel is positioned for success in today’s competitive market.
FAQs
Q1-What is the difference between a traditional RMS and an AI-powered RMS?
A-A traditional RMS processes data based on set rules and historical data, but it lacks the flexibility to adjust quickly to real-time market changes. An AI-powered RMS uses machine learning and real-time data to adjust pricing dynamically, taking into account more variables and providing more accurate predictions.
Q2-Do I need a human revenue manager if I already have an RMS in place?
A-Yes. While an RMS automates many aspects of pricing and distribution, a human revenue manager is still needed to interpret the data, plan long-term strategies, and adapt to unexpected market changes. They can make strategic decisions that technology alone cannot.
Q3-How can AxisRooms help my hotel with revenue management?
A-AxisRooms offers an affordable solution by combining the power of AI-driven RMS technology with a dedicated revenue manager. For just ₹4999 per month, you get both technology and expert human oversight, helping you optimize pricing, distribution, and maximize revenue.