As part of our ongoing “Spring Cleaning” blog series, we’ve covered various ways innkeepers can get their bed and breakfast into top shape for the fast-approaching spring and summer busy seasons, including crafting a solid marketing strategy and updating their website. In keeping with our theme, we now want to dive into the importance of rate management and its impact on bed and breakfast performance during the busy season.
Rate management is a critical year-round responsibility, but its importance is elevated during the busy season when guest rooms are in high-demand. As travelers comb through OTAs and hotel websites searching for great deals, innkeepers are tasked with rolling out a rate strategy that ensures their bed and breakfast remains competitive, occupancy stays high and revenue is maximized throughout the travel season. Here are a few tips to help innkeepers make informed, well-planned rate management decisions during this year’s busy season:
Examine historical data
Examining performance from past busy seasons is the first step innkeepers should take in developing their spring/summer rate strategy. Using your bed and breakfast management software to pull metrics, like ADR, RevPAR and occupancy, will provide insight into past booking trends and revenue flow that can be used to set performance benchmarks for the upcoming season.
Study your competitive set
It’s likely that other innkeepers are also preparing their bed and breakfast properties for the upcoming busy season, so searching their rates and special packages may produce valuable information to help mold your rate strategy. Pay close attention to the structure of their rate strategies, including minimum stay requirements, weekday vs. weekend rate differences, add-ons and other incentives. Understanding how competitors are positioning themselves to attract travelers will let you know how the market will likely trend during the spring and summer.
Dynamic seasonal pricing
The busy season presents great pricing opportunities for bed and breakfast innkeepers, but they require detailed planning and management. As demand for available room nights increases, opportunities to capture greater revenue follow. However, innkeepers must guard against driving travelers away with overpricing, as well as undercutting earnings with below market rates. Finding the right balance is key, so here’s where historical data and competitive research prove extremely valuable. By understanding the minimum and maximum rate thresholds for their property and the local market, innkeepers can establish a pricing range that allows them to dynamically adjust pricing during the busy season to capitalize on demand and increase earning potential while mitigating harmful risk.
Offers travelers can’t refuse
After completing all the hard work, here comes the fun part! With a solid rate management strategy in-hand, innkeepers can now structure rewarding travel packages that attract travelers, sell room nights and fill their bed and breakfast properties nightly. Whether it’s favorable weekday rates, complimentary service add-ons or enticing 3rd party entertainment offers, with a strong rate management strategy, innkeepers can confidently offer their guests great travel experiences while maximizing their earning potential during the lucrative busy season.
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