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Ingredients of effective hotel revenue management

To apply revenue management in a hotel there are a few basic ingredients you will need. What are these basic requirements to be able to successfully yield and optimize revenue and profit of a hotel?

So what do you need to apply effective hotel revenue management?

  * Market Segmentation
  * Historical Demand and Booking Patterns
  * Demand Forecast and Displacement Analysis
  * Pricing and Inventory Management
  * Overbooking
  * Information Systems

In the following section of this revenue management book or manual will go into more detail on these topics or concepts.


With regard to overbooking, it is simply necessary to oversell to reach 100% occupancy, without walking away clients. If there is a risk of walking away, the costs should be taken into account in the evaluation of the overselling (extra rooms revenue sold versus the costs of walking away or out-booking).


Patrick - Xotels