Revenue management during COVID-19
COVID-19 caught us all by surprise. Finding a response to the sudden loss of demand is not a solo exercise: stay calm and keep a clear head.
Your hotel may already have closed or may be about to. Your working situation may have changed dramatically, through a temporary furlough (ERTE in Spain) or the end of a temporary contract. Do not blame yourself or look for desperate solutions.
If you still have a link with your company, whether through reduced hours, a furlough or another arrangement, this is not the time to switch off. When the crisis is over, we will all have a role in rebuilding our industry: tourism.
What can we do right now?
Be flexible with non-refundable bookings
Whenever possible, offer a change of dates, a discount on a future stay or a voucher for the deposit paid. Any idea that helps retain a booking is worth considering. During the state of emergency, however, bookings falling within the applicable dates had to be refunded when the guest requested it.
We took inspiration from Sexta Planta, which made materials and templates available to industry professionals. Paraty Tech also developed a feature in its booking engine to change dates on non-refundable bookings.
Talk to colleagues in the industry
Keeping in touch with colleagues—through WhatsApp groups, tourism publications or phone calls—can help you plan your next steps and resolve questions.
Watch for new demand peaks
Many bookings for late March, April and May (hopefully we will not need to add more months) will move to later dates. Keep tracking demand to see where pick-up is shifting. Things may be very quiet now, but the first movements will come. A useful indication of where demand is heading is the new travel dates requested by groups that had bookings in the coming months.
Public holidays, events and conferences
Pay close attention to the new dates being considered. Be ready to adjust prices and add restrictions where needed.
Read the communications from tour operators and OTAs
The fine print in contracts you never expected to use is now coming into focus, and force majeure clauses are being invoked. We need to review each case and establish whether force majeure applies.
Tour operators and OTAs have shown different levels of commitment to their partners. Hosteltur recently reported on Booking.com’s position during the coronavirus crisis, including its decision to allow fee-free cancellations and the resulting strain in its relationship with hotels. Sometimes one explanatory phone call can prevent misunderstandings or help identify another solution for the property. During this crisis, I missed receiving more personal calls or emails from some partners, though others did reach out.
Social media, newsletters and promotional messages
I believe this is a time to be cautious about the messages we send. Personally, I do not think this is the moment for “discounts” and “offers”. A little humanity would go a long way. Try to empathise with what your future guests are experiencing.
Google Ads and metasearch positioning
There are two schools of thought. Some believe that the few people still searching will click on their hotel. Others believe it is time to pause all investment until the storm passes. The second option is gaining ground because we do not know when tourism will recover, and bookings generated now may be cancelled in the near future.
As you can see around you, nobody has a magic wand to fix this situation. But staying alert to the news and to changes across the industry can give us an advantage when it is over.
On a personal note, I sincerely hope you and your loved ones stay safe and well. ❤️
#StayHome