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Is Your Hotel Distribution Strategy Aligned to be Profitable?

Hotel Distribution Channel is by no means a one-size-fits-all scenario. It is also not a figure-it-out-once and forget about it task.

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Your Hotel Distribution Strategy should evolve with time and consider several elements. These include your target guests, business goals, pricing, and more. In this blog, we revisit key areas you need to consider to inform a distribution strategy that accelerates innovation, makes you resilient and grows revenue.

1) Refining your business objectives

Before you start tweaking your distribution strategy, go back to the drawing board and see if your business objectives are still valid. For instance, you may have previously wanted to attract more international visitors.

Is that still true? Do you need to improve your ability to fill last-minute vacancies as opposed to relying on advanced bookings?

2) Review your audience – target your best guests

Is your target guest the same as pre-covid? For instance, your focus previously may have been tech-savvy, high-spending, young millennials. However, as the travel profile has distinctly evolved, you may now want to focus on the boomer market for its financial stability.

Knowing your target audience, who they are, their travel behavior, interests, location, etc. is important to define your choice of distribution channels. Your channel manager insights and the property management system (PMS) are great sources of this information.

Did you know? STAAH Max Channel Manager comes with powerful reporting and insights for data-driven decision-making. The Reporting tool helps accommodation providers in their pricing strategy, forecasting the demand, targeting the right audience, conversion matrix, etc. Find out here

3) Seasonality

The travel industry is highly seasonal. A seasonal hotel distribution strategy takes advantage of that nature and combines it with online reviews, and an in-depth analysis of your revenue streams. With the right online hotel distribution strategy, you can maximize peak season bookings while simultaneously boosting bookings during the off-season.

4) Maintain competitive rates

In addition to finding the right channel mix, competitive pricing and channel management software for hotels is a critical part of your distribution strategy. Having a real-time understanding of market conditions and the prices offered by a comparable competitive set will help you optimize your rates.

When it comes to rates, it is also important to not just set and forget. Now more than ever before dynamic pricing is important.

By continually adjusting rates and stay restrictions based on local demand and market conditions, you are more likely to sell more rooms at the highest possible rate. Rates, occupancy and competitor activity lie at the heart of an effective dynamic pricing strategy.

5) Track acquisition costs

How much does it cost to acquire a guest through a channel? This is simple to do with the data available from your hotel channel manager software and PMS. Simply divide the amount of money you spend on a platform by the number of guests you acquire to arrive at the acquisition cost.

Don’t forget that your total cost per channel can include multiple metrics, including the cost of ads, maintenance, commissions, development of marketing creative, and your net revenue per available room (Net RevPar or NREVPAR).

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6) Choose your channel mix

Pick booking channels your target audience is most likely to use. A combination of channels is recommended for sustainable growth, with each channel playing a different role in your distribution mix.

OTAs are great for driving visibility and traffic, but direct is generally considered more profitable. GDS is critical to reach the corporate market. Metasearch platforms such as Google Hotels, TripAdvisor, Trivago, and Kayak pull rates from multiple OTAs and uniquely capitalize on their search reach.

The goal with every channel is simple: maximize your reach and visibility while minimizing the cost. This is where visibility offered by a channel manager on every channel becomes crucial.

7) Optimize your listings

It is important to ensure that every platform that a guest can see you on provides all the information they need to make a decision to book your property. This includes high-quality photos, compelling descriptions, and information about your location, amenities, and other features that appeal to your target markets.

Review your listings regularly to ensure information is always accurate and up to date. Online reviews play an important role in decision making, so pay careful attention to these.

8) Use technology to your advantage

The last step in coming up with a successful internet distribution system is to tie together all of the above-mentioned strategies with the right technology choices. From a channel manager to booking engine, revenue management software and a property management system, it is important to seamlessly connect your tools in order to inform a cohesive and responsive distribution strategy.





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