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2012 Apartment Revenue Management Conference

2012 Apartment Revenue Management Conference. Parallels between Hotels and Apartment Revenue Management. Understanding market trends; supply and demand Guest satisfaction Price elasticity The importance of forecasting unconstrained demand Distribution channels and social media.

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2012 Apartment Revenue Management Conference

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  1. 2012 Apartment Revenue Management Conference

  2. Parallels between Hotels and Apartment Revenue Management • Understanding market trends; supply and demand • Guest satisfaction • Price elasticity • The importance of forecasting unconstrained demand • Distribution channels and social media

  3. Hotel Industry Supply, Demand & Rates

  4. Revenue Management Evolution

  5. Evolution of Hotel Revenue Management • From call arounds to competitors to determine rates to nightly reports generated • From opening or closing a rate to full pattern length of stay pricing • From negotiating one annual rate to corporate clients to understanding account penetration and value • From knowing the demand for our hotel to knowing the demand in the market • From forecasting based on stale data to understanding pace and unconstrained demand by market segment • From pricing groups based on historical performance to forward looking metrics • From TA’s and call centers to online travel agents (Expedia, Kayak, Priceline) • From Reservation Managers to SVP’s and Chief Revenue Officers

  6. Pricing Knowing your competition

  7. Automated Rate Shopping Important to understand our pricing by arrival and length of stay in relation to our competitors

  8. Goal is to increase rates as the arrival date approaches As the date of arrival approaches and available inventory is reduced are we garnering higher nightly rates?

  9. Measuring Conversion Denial is recorded when the hotel cannot or will not accept the request for a room Regret is recorded when the caller does not book when a rate is quoted Conversion = Rooms sold/(Rooms sold + Denials + Regrets)

  10. Full Pattern Length of Stay Pricing The rate offered varies depending on multiple factors including patterns

  11. Pricing Annual Corporate Negotiations

  12. Corporate Negotiated Rates

  13. Account Evaluation Tool When determining annual corporate rates we take into consideration the total account value including their rate, room night commitment, length of stay and booking lead time

  14. Forecasting Market Intelligence and Pace

  15. Seasonality Understanding seasonal demand assists in determining mix and rates

  16. Booking Curve We also monitor individual stay dates booking curves. In this example we are comparing tomorrow to the same time last year and to last Wednesday

  17. Forecasting Demand We are charged with selling over 18,000 rooms each and every night. Ensuring we are accepting multiple night requests is key

  18. Pace It is important to understand the mix of business compared to last year and pick up

  19. Brands sharing future committed occupancies As technology progresses we have information available to us that we simply did not have 3 years ago

  20. Evaluating Strategies Constrained demand Unconstrained demand Lead time

  21. Internet Search Engine Optimization PPC Campaigns

  22. Anatomy of Search Results Paid Ads Hotel Finder Organic Google Places Search Results Pages are evolving – depending on the query or even whether or not you are signed in to a Google Account can impact the search results you see.

  23. Why Search Engine Optimization? • No Media Spend • More transactions are taking place online so it is important to have a presence and be found in every step of the marketing funnel • Drives leads to your most important distribution channel

  24. Why Paid Search? • Capture highly qualified leads • Set up keyword campaigns for each stage of the marketing funnel • Awareness • Consideration • Research • Purchase • Measurable Results

  25. We want to be where our guests are • Facebook 39,000 Likes • Twitter 20,000 Followers • Engagement versus promotional • Top of mind

  26. Measuring Results Smith Travel Research

  27. STAR determines market share and relative performance of hotel properties in various markets Performance measures based on occupancy, rate and RevPAR Index is your hotels performance relative to your competitive set

  28. Applying the RevPAR concept • Revenue per available unit • Complex has 300 units • 125 are 1 bedroom • 175 are 2 bedrooms • Average 12 month lease is $1,000 and $1,800 • 80% of the 1 bedrooms and 90% of the 2 bedrooms run occupied

  29. Calculating RevPAU

  30. Thank you

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