Pricing is critical to a hotel’s success
When making pricing decisions, hotels should consider various factors such as competitive pricing and available supply.
How we price is critical to a hotel’s success. It is also a subject that can generate some passionate discussions. The question becomes: how are we making these important decisions and what factors do we take into account? Whether you use a sophisticated price-optimization system or determine your rates manually, it is necessary to make a critical assessment of the information you are using to make and validate your pricing decisions.
Too often pricing decisions are made simply by following the competition’s lead or increasing rates once a hotel has limited inventory. Competitive pricing and available supply are two factors to be considered, but only skim the surface. I will explore some of the factors influencing price and how they may be used to make more effective pricing decisions. Each individual hotel’s situation is somewhat unique with differing internal and external pressures on how they price, but the overarching factors are universal.