Dynamic Pricing for hotels and resorts is Skyware Hospitality Solutions’ name for a Revenue Management Systems (RMS) also called “Yield Management”, - a term coined by Robert Crandall, former chairman and CEO of American Airlines in the 1980’s. Crandall called RMS, “The most important technical development in transportation management since airline deregulation.” It has been widely utilized in all sectors of the hospitality industry including airlines, hotels, and rental cars.
The main purpose of Hotel Property Management Software Dynamic Pricing is the ability to capture increased revenue opportunities by automatically fluctuating rates based upon occupancy rules. It is based on the open market law of supply and demand - when a commodity is scarce and demand is high, the price rises; and, when a commodity has excess supply and demand is low, the price decreases.
So, how does this work in Skyware Property Management System (PMS)? Every hotel has a limited amount of supply of rooms available on any given day. Once a hotel’s rooms are all rented, supply is sold out and room revenue cannot be increased. Customer demand varies based upon the day of the week, season of the year, and the events being held locally. **Therefore, it is reasonable to assume, your customers will gladly pay a higher rate when the demand is high. ** And they will expect to pay a lower rate (or go to a competitor) when demand is low.
Skyware’s Hotel Dynamic Pricing provides hoteliers the ability to automatically maximize revenue during peak times!
With a Hotel or Resort Dynamic Pricing feature, hotel management can set rules that increases or decreases the room rates by a fixed amount (or percentage) based upon the total occupancy of the hotel or resort for that category. For example, Labor Day weekend may be a high demand weekend for a hotel. Customers may book reservations far in advance of the weekend. Many room types sell out all of their inventory weeks if not months before the labor-day weekend. With Skyware’s Hotel Dynamic Pricing, hotel management can set up a rule that says, the stated price of $125 per night is available when the total occupancy is less than 50%. When reservation occupancy exceeds 50% occupancy, the price automatically increases to $140 a night. If the occupancy exceeds 60%, the price increases to $150 a night continuing until the occupancy level for that category reaches 95%. The amount of the increase and the level of occupancy is determined by the hotel management.
**Since all of this is automatically done by the reservation system, the hotel staff never needs to make an adjustment to the system. ** Pricing for all rooms is tracked in the system and available to any employee making an inquiry. With Skyware’s integrated online booking engine, real-time site inventory, and rate pricing flexibility, all property site data is available on a minute-by-minute basis. Hotel or Resort Dynamic Pricing is one of many key features that helps Skyware Hospitality Solutions provide the best PMS Software.
What do People have to Say about Skyware’s Dynamic Pricing?
Sandy Smith at Fenwick Inn in Ocean City, MD says “We use multiple rate plans for multiple room categories. Dynamic Pricing allows us to set up a series of rates based upon specific occupancy thresholds. Skyware’s Dynamic Pricing feature saves us tremendous time and maximizes our revenue stream at the same time. We basically couldn’t do what we are doing without it!”