Question for Our Revenue Management Expert Panel:

Amid changing travel guidelines and restrictions, flexibility has become essential for travellers. How are you addressing this? How has your revenue management strategy adapted to meet those needs?

Industry Expert Panel

Our Industry Expert Panel exists out of professionals within the hospitality & travel Industry. They have comprehensive and detailed knowledge, experience in practice or management and are forward-thinking. They are answering questions about the state of the industry. They share their insights on topics like revenue management, marketing, operations, technology and discuss the latest trends.

Pablo Torres
Pablo TorresHotel Consultant, TSA Solutions

“When it comes to reservations, full flexibility has become the new norm. Trying to maintain any restrictions (prepaid, non-refundable) would turn into a disadvantage, as the comp set will offer easier terms. With so much uncertainty around travel restrictions, the current scenario will extend over time. Customers and guests will get used to these flexible terms, making it challenging to resume stricter cancellation conditions in the mid-term.

This also creates a challenge when it comes to forecasting, especially when the client base is predominantly domestic or can reach the destination by car. However, for destinations further afield (e.g., Maldives, Seychelles) or those relying on foreign demand (e.g., Cancun), the impact of the current flexible terms is not as high. In these cases, customers tend to book well in advance and with a lower chance of last-minute cancellations.”

Dian Tristyanti
Dian TristyantiRevenue Management Professional

“One of the main adaptations has been to offer more flexibility in the cancellation policy, while also looking closely at competitor reactions to the situation. However, it’s important to be mindful when changing strategy like this, i.e., avoid moving a hotel into a position that’s difficult to return from in future ideal-pricing situations.

It’s also important to ensure a seamless guest booking journey and a simple check-in process. Discussing these matters closely with the operational team is essential for proper planning before implementation. During implementation, observation and evaluation will help you to spot areas for improvement and maintain the all-important positive guest feedback.

Clearly conveying any changes to guests is key, keeping them well-informed for their decision-making process.”

Edyta Walczak
Edyta WalczakCluster Revenue Manager, Arora Hotels

“As we are finally emerging from hibernation after a year, it’s important to recognize that the behaviors and priorities of our customers have changed concerning travel. Traditional revenue techniques and tactics no longer apply now. Many of us have had to adjust travel plans, holidays, and business trips, and it’s clear that flexibility has become a key factor when choosing a hotel. This has meant that cancellation policies, flexible check-in and check-out times, and flexible paying options have had to be adapted. We can see this trend when we analyze booking lead-time data and the most popular products purchased by guests.

One of the approaches we’ve taken is to remove advance, non-cancellable rates. Instead, we opt for semi-flexible, slightly discounted products that can be cancelled and refunded. The new trend of flexible check-in and check-out has seen more and more hotels offering those options and customers have responded positively. Apart from transient segments, we also need to (individually) look at offering more flexible terms to committed segments such as groups and MICE. These often depend on international travel restrictions and guidelines.” 

Thibault Catala
Thibault CatalaFounder, Catala Consulting

“Due to the new market conditions, our strategy has become increasingly centered around flexibility. At the moment, this is vital for a great guest experience. We have reduced the number of products being offered so that we can keep our flexible options as competitive as possible. Traditionally, these flexible options have always been kept at a premium rate within the industry. This has been to ensure guests shift towards non-refundable options, but also to make sure there is enough margin to use tactical discounts. We have shifted away from that and are focused on a compression strategy. Essentially, this involves cutting out the most restrictive rates (which are always the cheapest) and seeking to make our flexible options as competitive as possible.

Another tactic we’ve recently been exploring is the introduction of a Flexible Advance Purchase rate (fully prepaid). This gives the possibility to cancel/postpone/get a refund if the guests are unable to travel. One of the drivers behind this new practice was recognizing a strong price sensitivity in the market, a need of securing cash in advance for hotels (with an increase in confidence in future months) ultimately, an increasing demand for flexible conditions.”

Patrick Wimble
Patrick WimbleManaging Director, Lightbulb Consulting

“While I don’t currently revenue manage any properties, my suggestion for clients is to be as flexible as possible while you can and while demand levels allow. We know this can lead to challenges concerning forecasting, staffing, etc., but if viewed through a customer lens, flexibility is paramount for anyone travelling at this time.

Yes, it depends on the segments you have in-house, but for the most part, being seen as flexible and guest-focused will build guest loyalty. It will also potentially help with guests being more understanding if / when you decide to begin removing some of this flexibility when normal business patterns return.”

Jutta Moore
Jutta MooreDirector, Moore Hotel Consulting

“We currently don’t offer any non-cancellable products but have applied varying, flexible cancellation policies according to location (i.e., city centre or resort). Although this brings higher risk & uncertainty, it is what’s needed for travellers to confidently book hotels. It is key to increase demand and create trust to show that we are easy to do business with.

The aim is to gain more commitment from guests by driving restaurant & spa bookings. In addition, we offer ‘check-in or out any time you like’ options to create additional value.”

Celine Quek
Celine QuekSenior Lecturer, School of Hospitality at Republic Polytechnic

“I believe companies should be more creative in targeting their segments by understanding the intention to travel and then tailor their product accordingly. Flexibility is a key requirement for most travelers and the hospitality and travel industry should be more creative in its product offerings.

The price differential could be based on the duration of stay rather than the cancellation policies. That is, for guests who check-out based on their check-in time, they will pay more than the guests who check-out at the standard check-out time.”

Tanya Hadwick
Tanya HadwickGroup Revenue & Yield Leader, SunSwept Resorts

“Typically, we have reduced our cancellation period to within 7 days free, accommodating those who’ve failed their mandatory PCR tests, or have been impacted by last-minute travel restrictions. For re-booking, we have allowed guests to amend within 12 months at the same rates, or opt for a travel credit towards any future dates if desired. The goalposts keep changing, so we are adapting as per requirements, in some instances offering much more.

As a resort with a high percentage of repeat clientele, it’s a balance between maintaining the booking and ensuring that potential demand is not displaced. I think flexibility has become almost client-based as well, i.e., loyalty has a high impact on the strategy. The strategy also has to adapt, as people are now less willing to book further out, so the pace of the past cannot be considered for the future. Like many others, we have also begun to offer vouchers for future planning and have adapted our deposit policies.”