tailieunhanh - Lecture Hotel management and operations (5th Edition): Chapter 7.4 - Michael J. O'Fallon, Denney G. Rutherford

The first step in a yield management program is to determine who is the best customer. The best customers are: The ones who can spend the most money at your property purchasing profitable items, the ones who receive the greatest benefit from your services. | Hotel Pricing Marta Sinclair and Carl R. Sinclair Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Traditional Approach The single most important criterion of any business, such as a hotel, is profit. Historically, price has been determined by a triangular relationship between: Cost Demand Competition Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Traditional Approach Cont. Quantitative methods: “Rule-of-Thumb” “Hubbart Formula” Qualitative methods: “Percentage Increase” “Pied Piper” “Follow the Leader” “Gouge Em” Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Traditional Approach Cont. The fundamental question remains, what should be the driving force for formulating a sound pricing strategy? Demand orientation Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Current Pricing Criteria When the chain is setting its pricing, it starts with a comprehensive market research. Based on the data, the correct price for each marketplace is determined. If there is a major shift in a market, then the prices will adjust for that. However, if there is a major shift in a demand curve, then a shift of price may have no effect. Generally, however, lowering rates across the board is not the preferred pricing strategy. Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Pricing: Who is in Charge? While independently owned properties make their own pricing decisions, in case of a chain it is usually corporate headquarters (HQ) that set pricing guidelines. Often individual properties are still responsible for the actual pricing. However, successful pricing strategies arise from an ongoing interaction between both sides. Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Pricing: Science, Art, and Intuition Pricing distribution and revenue management techniques are a mix of science and art. 2/3 of managers use a combination of analysis and intuition when making strategic decisions. Yield management | Hotel Pricing Marta Sinclair and Carl R. Sinclair Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Traditional Approach The single most important criterion of any business, such as a hotel, is profit. Historically, price has been determined by a triangular relationship between: Cost Demand Competition Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Traditional Approach Cont. Quantitative methods: “Rule-of-Thumb” “Hubbart Formula” Qualitative methods: “Percentage Increase” “Pied Piper” “Follow the Leader” “Gouge Em” Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Traditional Approach Cont. The fundamental question remains, what should be the driving force for formulating a sound pricing strategy? Demand orientation Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Current Pricing Criteria When the chain is setting its pricing, it starts with a comprehensive market research. Based on the data, the correct price for each .

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• Hotel management
• Hotel operations
• Hotel management and operations
• Hotel management system
• Hospitality industry
• Hotel pricing
• Hotel performance
• Hotel organization structure
• Hotel general manager’s job
• Hotel lobby
• Hotel engineering function
• Contemporary hotel catering
• Hotel Sales Organization
• Final year hotel management students
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• Human capital requirement
• Multinational hotel companies
• Hotel management institutes
• Yield management
• Revenue management
• Beverage management
• Resort spas
• On line pricing
• Lodging industry
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• Organizational design
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