A hotel channel manager assists in generating more revenue in a number of ways by maximizing room distribution, optimizing operations, and facilitating more dynamic pricing.
- Maximizes Room Occupancy
By making sure that available rooms are being shown correctly in real time on all the channels of distribution, an underbooking and an overbooking are avoided. This guarantees that optimum occupancy levels are achieved, with the hotel selling as many rooms as can be sold at a time. The higher the occupancy, the higher the revenue.
- Dynamic Pricing and Rate Management
Most channel managers provide hotels with dynamic pricing rules to set the room rate, allowing the rate to be dynamically modified according to demand, special occasion, time of year, season, or competitors' rates. Demand-based pricing enables hotels to raise rates in high-demand situations (e.g., weekends, holidays, or local festivals) and lower them for low-demand situations to promote bookings. It maximizes maximum possible occupancy and revenue per available room (RevPAR).
- Greater Exposure on Many OTAs
Through a channel manager, hotels can spread their rooms across many Online Travel Agents (OTAs), including Booking.com, Expedia, or Airbnb. The greater the distribution, the greater the susceptibility of the hotel to revealed travelers and the greater the chances of booking. Increased exposure across many platforms gets revenue from revealed higher traffic.
- Avoids Rate Discrepancies (Rate Parity)
A channel manager provides rate parity in each booking channel. Therefore, the hotel is able to have the same price on various OTAs and the hotel website without a price change that may cause confusion or dissatisfaction of guests. Rate parity gives guests confidence and assures the hotel receives maximum revenue without undercutting the price on any platform.
- Reduces the Risk of Overbookings
Overbookings can result in financial loss through refunds, compensations, or negative word-of-mouth. With a channel manager, all bookings across various OTAs are synchronized automatically. Once a room is reserved on one channel, it is instantly synchronized on other channels, reducing the incidence of double-bookings and ensuring that the hotel is not financially affected through booking errors.
- Enhanced Time Efficiency and Lowered Operation Costs
By automating the room availability, rate, and booking update process, hotel staff have less time on their hands to manually work on these activities. This means increased efficiency and minimized operational expenses, freeing the hotel to use it towards revenue-driven activity, including upselling or better guest service.
- Access to Real-Time Analytics
Other hotel channel managers also include reporting facilities, which give the performance overview based on various booking channels. Hotels may use data on booking patterns, room occupancy, and revenue streams to decide about channel allocation, marketing, and pricing. If hotels know the most profitable OTAs and channels, then they can optimize their strategy to get the maximum from the most profitable channels.
- Avoids Lost Revenue from Cancellations
A channel manager helps hotels quickly reconfigure their cancellation policies and manage availability. If a guest has to cancel, the channel manager can instantly resell the room to other potential guests to stay, thus not losing revenue. It can even be set up to dynamically lower rates, depending on the current availability of the hotel to appeal to more reservations.
- Provides the Freedom to Experiment with Promotions
Channel managers can usually provide the hotels with rights to set promotions (like last-minute deals, early bird promotions, or promotional seasons) across numerous platforms. Targeted offers on multiple OTAs allow the hotels to attract more guests, boost bookings, and earn higher revenue during slack seasons.
- Improved Customer Experience and Return Business
By avoiding overbookings and streamlining operations, a channel manager can help create a more customer-friendly experience. Happy guests will return, review, and recommend the hotel to others. Repeat business is an important source of revenue, and a channel manager offers the seamless, glitch-free experience that encourages guest loyalty.