Increasingly revenue management has become critical to the management of hospitality organisations especially hotels. Managers need special skills, knowledge and procedures in order to profitably align price, product and buyer. You are therefore expected to show such attributes through:
a) An explanation of revenue/yield management.
b) An analysis of sales techniques used to promote and maximise revenue.
c) An evaluation of the usage of forecasting and statistical data in the room division.
d) A description with calculation of performance indicators used to measure the success of accommodation sales.
4.1) An explanation of revenue/yield management (a)
In order to maximize the revenue hotel, Hilton London Kensington can adopt many policies to maintain the consistency in the revenue earning the hotel authority also can adopt some policies. the success of the hotel is to maximize the sales of the hotel room (Baccarani et al. 2015, p.34). If the sales of the hotel can be increased then the hotel authority will be able to increase their revenue. In this context, the hotel authority can sell a right room in a right price in order to increase the room occupancy of the hotel. In changing economic condition, the hotel authority can take the help of modern software in order to set the right price for the right room of the hotel. In this case, the use of software can observe whether the price of the room is exceeding the industry price or not. The hotel authority can get more information about the industry by using the software (Cohen and Olsen, 2013, p.245).
In order to maintain the consistency about the earning of profit, the hotel authority can change a policy of the hotel. For example, it can be said that the hotel authority can declare that there is no cancellation fee in the hotel (Koyuncu et al. 2014, p.1083). In effect of this, the customer cannot get back the money from the hotel for cancelling the booking, the will be the income of the hotel. In addition to that, the hotel authority can sell a right room in right price to the right customers and this will be another way to earn more revenue.
So from the above discussion it can be said that maximizing the room occupancy will be the important technique to the authority of Hilton London Kensington in order to maximize the revenue.
4.2) Analyzing the sales techniques used to promote and maximize revenue (b)
Sales techniques are one of the important strategies to promote and maximise profit. In order to implement effective sales techniques, an effective employee are needed who will be responsible for the room selling to the customer. In this case, Hilton London Kensington should employ the efficient employee in order to maximize the room occupancy of the hotel. The employee of the hotel who is directly engaged in the selling of the room must have the knowledge about all the sell techniques like up selling, top down, Cross selling and bottom up (Koc, 2013, p.3681).
In addition to that, the hotel authority can maintain the customer database in order to gather the information about the customers. It may be helpful to Hilton London Kensington to provide special offers and special service to the regular customers in order to develop the long term clients of the hotel ((Ekiz et al. 2012, p.96).
Hilton London Kensington can use the up-selling technique to increase the revenue of the hotel. In this technique, the hotel authority can provide more service to the clients when the client made the reservation in the hotel. In this case, the hotel authority can provide special packages to the clients or can upgrade the service, which may be interesting to the customers. Apart from this, the hotel authority can adopt a better marketing strategy in order to maximize the sales of the Hilton London Kensington. In this regard, the Hilton London Kensington can use the media and internet for publicity in order to generate more revenue (Barlow et al. 2013, p.146).
4.3) Evaluating the usage of forecasting and statistical data in the room division (c)
For the hotel like Hilton London Kensington, forecasting is one of the important tools to predict the future market on the basis of the past and present condition of the hotel. In order to do this, the hotel authority should maintain a database that helps the hotel to analyse the market condition and occupancy of the room. In this case, the hotel authority can predict or forecast the future action on the basis of the statistical data by using some software. In this case, the use of the modern software is needed in order to predict the future action. The market condition of the Hilton London Kensington is dependent on the room division or on occupancy of the room of the hotel. In order to maximize the revenue, the hotel authority should maximize room occupancy. In order to do this predictive modeling is required because this will forecast the future demand of the room of the Hilton London Kensington (Ekiz et al. 2012, p.96).
The Hilton London Kensington can develop their business strategy on the basis of this forecast. For the better result, the hotel authority will adopt the statistical forecasting because it includes the projection of market trend, it analyses the seasonal trend and it helps to smoothen data of the hotel. On the basis of the forecast if the hotel authority thinks that the past business strategy was efficient then the authority of Hilton London Kensington will follow the same strategy to maximize the occupancy of the room. If the hotel authority thinks that the past business strategy is not efficient then the authority of the Hilton London Kensington should go for a better business strategy for the room division in a current year (Huang, 2014, p.293).
4.4) A description with calculation of performance indicators used to measure the success of accommodation sales (d)
Number of room
50 occupied by 2
5 occupied by 1
70 occupied by 2
60 occupied by 1
245 room let(365 guests)
Table 1: Calculation of performance indicators
Room occupancy percentage:
Percentage of sleeper occupancy:
Average of room rate:
In this calculation, all charges of the room are based on the decision of the authority of the Hotel Hilton London Kensington (Koyuncu et al. 2014, p.1083).