This is How to Succeed as a Hotel Revenue Manager
As a relatively new addition to the hospitality industry leadership circle, the role of a revenue manager is constantly evolving. Hotel revenue management requires an eye for detail, interpersonal aptitude, technical skills and analytical prowess all combined. From managing room rates to negotiating commissions on distribution channels revenue managers today must be skilled at all commercial aspects of the hotel business. Finding the right price for hotel rooms is both an art and a science.
So how does one become a rockstar hotel revenue manager in 2020 and beyond?
Simple, get a revenue management job!
Kidding aside, the best way to learn how to excel at something is to watch the best at work - so in this article we’ll go into detail on the daily lives of revenue managers to help you understand the skills you’ll need to succeed in this highly dynamic role.
We asked some of the best revenue managers we know to help us craft this article. We then took their feedback and used it to show you exactly how the best RMs in hospitality plan their work days and then detail the skills they use throughout the day.
Lots of hoteliers are interested in this exciting data driven role, but few understand what it actually entails.
Before we get started, we want to give a huge shoutout to the rockstar revenue managers who helped make this resource possible:
- Connor Vanderholm, Corporate Revenue Manager @ Aimbridge Hospitality
- Rafik El Guizawi, Corporate Revenue Manager @ Dimension Development
- Sarada Muduli, Corporate Revenue Manager @ Lords Hotels & Resorts
- Kevin Chan, Revenue Manager at JC Resorts
- Daniel Jang, Senior Revenue Manager @ Marriott Hotels
- Elizabeth Selva, Revenue Manager at Kriya Hotels
- Fabian Bartnick, Founder at Infinito
- Adam Richards, Revenue Manager at Hilton
Let's dive in!
The Basics: Becoming a Revenue Manager 101
In the simplest terms, a hotel’s revenue manager is responsible for setting prices that will maximize the hotel’s profitability and meet its strategic goals. While this task might not sound daunting at first, it involves a mix of analytical skills, market research, critical thinking, and a little bit of gut instinct to make sound pricing decisions. Great revenue managers must also balance the hotel’s mix of group and transient business which entails negotiation between marketing and sales.
RMs must also develop and implement promotional strategies and serve as the main point of contact between the hotel and online travel agencies.A revenue manager needs to keep a constant pulse on the hotel’s competitive set as well as demand drivers in the market, like major events and holidays, since these external factors also affect the hotel’s positioning. Sure this includes reading and understanding STR reports but is just the tip of the iceberg. Great RMs don’t just understand the fundamentals like price elasticity but they deeply internalize the concepts and have a gut feel for how they are shifting in real time.
On-Property vs. Corporate Revenue Managers
Unlike other hotel positions like a rooms manager or a general manager, a revenue manager is not always required to be on property. An on-site revenue manager can benefit from firsthand knowledge of the market and activities at the hotel, but, thanks to technology, hotels can leverage the skills of a corporate revenue manager with great results.
“As a remote revenue manager I have the fortune to avoid a lengthy commute which enables me to start my day earlier than normal, I start at 7 am every day. The first thing I do is clean up my inbox of any correspondence sent to me after hours so everything from the day prior is resolved and I have a clean slate. I then get to work on inventory review for all my properties giving extra heed to unusual pickup within the next 14 days, double digit pickup within 90 days, or 5+ pickup in the next 365. After this I begin preparing for my weekly revenue calls with hotels which I try to schedule Tuesdays-Thursdays which leaves Mondays and Fridays for team meetings, trainings, projections and large system or rate adjustments. I set aside time each week to work on building Excel-based tools or enhancing the ones I already use. I spend as much time in One Yield and GRO as I can but but looking at past and future trends for revenue calls is best done by pulling reports and plugging them into Excel tools.” - Connor Vanderholm, Corporate Revenue Manager @ Aimbridge Hospitality
While the role of a revenue manager is similar whether they’re based on property or not, there are a few key differences. A corporate revenue manager might oversee a cluster of several properties, up to several dozen, as in the case of Sarada Muduli, Corporate Revenue Manager at Lords Hotels & Resorts, who manages a portfolio of 25 hotels. In order to manage their portfolios effectively, a corporate revenue manager’s schedule might contain frequent calls with each hotel.
“I supervise and head 25 mid segment hotels within ARR bracket of USD 35-55 . First thing I look at the trend of market segment and business source contribution to a particular hotel Then I come to know where is the loophole if any hotel is going down YOY or to Revenue Budget. Then I look at the pick up analysis, forecasting and market analysis. Then I meet my team for next week's preparation and the instructions are clear between us. Why to do and how to do it”
- Sarada Muduli, Corporate Revenue Manager @ Lords Hotels & Resorts
"The routine requires a lot of discipline because of the distractions that come up on a daily basis. We constantly have to be planning and adjusting strategies for the future, which is the most important part of the job while explaining the events that caused the recent results. So we to be successful, we have to be in tune with past, present and future."
- Rafik El Guizawi, Corporate Revenue Manager @ Dimension Development
While a corporate revenue manager relies on calls and emails to stay up to date on the hotel’s activities, a property-based revenue manager spends time interacting with other hotel employees on a face-to-face basis. Taking the time to chat with colleagues isn’t just to be social, but also to gain important insight into the challenges and ideas coming from other departments.
Many hotels and hotel management companies work with remote revenue managers, but these arrangements are not one-size-fits-all. One hotel may have a dedicated revenue manager who just happens to be based remotely, while other hotels might work with a cluster revenue manager. In this case, a revenue manager oversees several hotels within the same management company or brand. Best Western, for example, has remote revenue managers who work with portfolios of Best Western properties across the country. In other cases, hotels might work with remote revenue managers to benefit from revenue management expertise without needing to hire an in-house revenue manager on a full-time basis.
The Best Revenue Managers Understand Technology
Technology is an essential component of any revenue manager’s job. In addition to the hotel’s property management system, revenue managers must be familiar with using the channel manager to feed rates and availability to online travel agencies, a market intelligence tool to provide insight on competitor rates and market demand, and a revenue management system to help them decide on the optimal rates to sell. Most of all revenue managers must be experts at leveraging revenue management software like IDeaS G3 to effectively make pricing decisions and implement real time strategies.
“The exceptional revenue managers I know are dedicated to becoming RMS system subject matter experts who can answer that all-too-common question, “what is the system thinking?”
-Connor Vanderholm, Corporate Revenue Manager @ Aimbridge Hospitality
“Know how your systems work with one another. Understanding which systems are interfaced with each other is key. It's inevitable that technology will break. But fixing it and preventing major integration issues, can save the company a lot of time and potential lost revenue. Test yourself, draw a systems map of all of the technologies and systems your property uses. Identify which messages are sent from where, what each one controls, how that affects your reservations and what do to if it fails. Be a systems expert, not just a systems user!”
-Kevin Chan, Revenue Manager at JC Resorts
A nearly endless amount of historical data, competitor rates, and market statistics mean that a revenue manager must leverage technology solutions to reveal the story behind the numbers and find its implications for the hotel.
Revenue Managers are Leaders
Though it may seem lonely to work in the Revenue Management department, which is usually just one or two people, revenue managers are constantly interacting with other hotel departments. The Sales team is a crucial partner for any revenue manager, since these two departments must work together to decide on rates and availability for group room blocks. Revenue managers also work closely with the Marketing department to create promotional offers and campaigns. And revenue managers and the Operations team collaborate on executing promotional offers, upgrades, and overbookings, if necessary.
“We revenue managers love our numbers, but we have to remember that this is an industry of personal connections and we can’t get anything done without buy-in from the whole team. The exceptional revenue managers I know build strong relationships with their stakeholders by soliciting and valuing their input. It is crucial that on property operations property teams are listened to and that their experiences are leverage toward a holistic revenue management strategy. We revenue managers love our numbers but we have to remember that this is an industry of personal connections and we can’t get anything done without buy-in from the whole team.” - Connor Vanderholm, Corporate Revenue Manager at Aimbridge Hospitality
“I will always set aside face-to-face time with our sales team as they are vital to building a strong base that allows us to Yield the remaining rooms to maximize revenues daily. My work is probably 50/50, split between work on the computer and meeting with people around the property. I find it beneficial to speak with the other departments on a regular basis to help me keep a good pulse on everything that is going on. The hotel is an ecosystem, everything connects and affects one another. It’s also critical to be aware of what Marketing is trying to promote and communicate because that could affect our decisions the next day.” -Kevin Chan, Revenue Manager @ JC Resorts
A Day in the Life of a Rockstar Hotel Revenue Manager
While any revenue manager will tell you there’s no “typical day,” most begin their mornings by checking email and reviewing daily reports. Depending on the systems they use, some revenue managers need to pull reports manually, while others receive automated reports or use dashboards to get the data they need.
“Typically, I begin my day by briefly looking over the reports generated from the night prior - reviewing pickup for the prior day, our pacing to prior year and how it may impact pricing on higher, or lower demand dates. Shortly after, I attend the RevMax meeting with our Sales Team to review any new leads for the day. The rest of my day consists of yield management of the property's availability, restrictions and pricing strategies, meetings with the GM, Sales Team, Marketing, Call Center, Analytical work to identify booking trends, as well as monitoring and managing our network of third party booking systems, such as the OTAs, our CRS and GDS systems. In addition, I always block an hour a day of uninterrupted time, where I will dive into Demand360 forward looking reports, pace analysis reports, data extraction reports from our RMS. This time allows me to get a grasp of any potential changes in our comp set, the market, and within our own property's production. Managing the RMS (we use IDeaS G3) and ensuring I agree with the decisions it recommends is vital to my team trusting the system, which frees up time for me to focus on other items.”
-Kevin Chan, Revenue Manager @ JC Resorts
“My Daily Habits includes running daily pick up reports to see how many rooms we picked up and utilizing that information to make strategic pricing decision. Knowing market trends and leveraging that information to maximize my hotel's revenue. Reviewing forecast to ensure the hotel is on track to hit forecast/budget. Communicating with the front office on strategy for a perfect sell.”
- Daniel Jang, Senior Revenue Manager @ Marriott Hotels
Most of the morning is spent analyzing these reports to determine what caused results in the past, for instance, why the hotel didn’t sell out yesterday when it sold out on the same day for the last 5 years in a row, and forecasting for the future. With so much data at their fingertips, revenue managers must prioritize between analyzing competitor rates, researching upcoming events, studying rate trends, and evaluating how effective certain strategies are.
“We constantly have to be planning and adjusting strategies for the future, which is the most important part of the job while explaining the events that caused the recent results,” Rafik El Guizawi, Corporate Revenue Manager @ Dimension Development.
After lunch, revenue managers might meet with other hotel departments in person or via phone. A revenue manager might meet with the sales team several times per week, with the marketing team once every other week, and with the entire hotel leadership team on a weekly basis. If the hotel is part of a brand or management group, there might also be a regular meeting between the brand’s or region’s revenue management team.
“On my weekly revenue calls, I analyze granular level data to make educated pricing and yielding changes for the next 365 days out to ensure there aren’t any major events or opportunities missed!” Elizabeth Selva, Revenue Manager at Kriya Hotels.
These interdepartmental meetings are important, since they offer a great opportunity to gather feedback and ask for input from other stakeholders at the hotel. Sometimes fresh eyes can deliver exactly the insight a revenue manager needs, but sometimes two departments have very different ideas about a pricing strategy. For this reason, it’s crucial that a revenue manager’s people skills are as strong as their analytical skills.
4 Key Revenue Management Skills
Whether you’re considering entering the revenue management track or an industry veteran who’s always trying to improve, these pearls of wisdom from revenue managers around the country show that their success is no accident. Hear directly from leading revenue management professionals who graciously shared their advice and daily routines with us.
#1 Become the go-to system expert
As a revenue manager, technology is an essential component of day-to-day operations, so learning the ins and outs of each system can not only make your work easier, but it can also build your credibility. Knowing why the system did something or how to interpret a result can make the difference between a good revenue manager and a great one, especially in the eyes of a colleague in another department.
“Technology changes faster than we can keep up with and we end up reacting by instinct vs. thinking of our actions” -Fabian Bartnick, Founder at Infinito
#2 Build strong relationships
Though the analytical part of a revenue manager’s job can easily become the whole job, make sure to nurture the personal connections with colleagues and According to Connor Vanderholm, Corporate Revenue Manager at Aimbridge Hospitality, revenue managers can “build strong relationships with their stakeholders by soliciting and valuing their input.” Instead of working in front of a screen with the office door closed, a successful revenue manager will purposefully take time to talk with not only colleagues, but also revenue managers at neighboring hotels, their market managers from online travel agencies, and industry mentors.
“The more comfortable your peers are around you, the easier your job will be.” -Kevin Chan, Revenue Manager at JC Resorts
“Be accessible - The more comfortable your peers are around you, the easier your job will be. As the conductor of the revenue generation tactics the team as a whole work together to employ, having people come to you naturally and keeping you updated is extremely beneficial. It'll save you time, as well as help build strong relationships with those you have to work closely with.” -Kevin Chan, Revenue Manager at JC Resorts
#3 Embrace group business
No, a sales manager didn’t pay us to write this, but most revenue managers could use a gentle reminder that the sales team isn’t out to sabotage your strategies. By adopting a positive mentality around group rooms, revenue managers can improve their relationships with the sales team and build a strong base of business in advance.
“The most effective thing that a revenue manager can remember is that "group is king.” Cover a week and move on. Having a sound relationship with your sales team will allow you to strategize around group, find the base where you need it, and ultimately give you the biggest impact.” -Adam Richards, Revenue Manager at Hilton
#4 Stay up-to-date on industry trends
A good revenue manager might know everything about the competitor hotel down the street, but a great revenue manager also keeps current with broader industry news and trends. Revenue management is growing quickly and changing rapidly with the adoption of new technology, and it seems there’s an innovative new software company popping up every week with new revenue management insight. Subscribing to industry newsletters or attending industry events will help you apply these macro-trends to your hotel’s strategy.
“Expand your knowledge of the key players in the industry and how their actions are influencing the market, which will give you a leg up in decision making!” -Elizabeth Selva, Revenue Manager at Kriya Hotels
Strengthen Your Revenue Management Skills Today
Using a variety of skills and systems, a revenue manager is certainly an exciting and challenging role at any hotel. Whether home-based or property-based, revenue managers gather essential insight from market trends and historical data to shape their hotel’s pricing strategy, which ultimately drives ADR, occupancy, and RevPAR toward the hotel’s targets. While revenue management and dynamic pricing are still considered relatively new ideas in the hotel industry, revenue managers have the opportunity to work at the forefront of this change and bring their hotel into the digital age with sophisticated technology solutions.
Eager to learn more about how to hone your skills as a revenue manager?
1. Hospitality Careers: Revenue manager job descroptions, job titles, salaries (entry level, managers, revenue analysts and commercial leaders). We also created a step-by-step guide on how to land your next revenue management job using the Hcareers platform.
2. 3 Surprising Routines that Unlock Revenue Management Genius
3. Understanding the Demand Curve (And How It Works)