I never seem to say everything I meant to say...
I interrupt my regularly scheduled "Lessons" blogpost series to bring you this post of all the things I meant to say in the sessions in which I participated but didn't actually say out loud (or at least very clearly).
First of all, I know I can't be the only one who experiences this frustrating recurrence, but it's still annoying, nonetheless. When I outline and rehearse the things I want to say - in my head AND out loud in front of a mirror - and I STILL don't say what I meant to say... Even after I make notes in the Power Point presentation and everything! How does this happen?? Anyway, I thought I'd take some time to make sure I highlighted a few of the things that I'm pretty sure I missed - not just because it will make me feel better but because I think they're important (way to miss important stuff, Sarah...).
I'll start with the session I co-presented with Jordan Locke of RevPARTY and Emily Pattillo of Highgate Homes: Distribution, the Critical but Overlooked Piece of your Revenue Strategy.
First, as the title indicates, I feel very strongly that a distribution strategy is an absolutely necessary part of any revenue strategy. I mean, the three of us wouldn't have put together a session on this topic if we didn't think it was important. My personal opinion is that there needs to be more focus on how to actually utilize the various channels and not just be satisfied with merely listing on them. The bulk of this session was intended to focus on what specific levers you have available to you to do just that.
For those of you who weren't in attendance, the three of us each reviewed promotional and merchandising opportunities available on three major OTA channels - Airbnb, Vrbo, and Booking.com (BDC). Emily started out by outlining the various opportunities available in Airbnb in great detail, I outlined some of the thought processes you might want to consider whilst choosing which to utilize (using BDC programs and promotions as illustrations), and Jordan finished up by demonstrating how those thought processes might result in effective use of a specific lever (Boost on Vrbo). Unfortunately, we didn't even get to the part of the session where we were planning to talk about channel managers, the future of distribution, et al. If I can get my act together, I'll see if I can get all three of us to collaborate on a post to discuss those things!
So at least for me, the things that I MEANT to point out or discuss include:
Because conversion is the driver of everything that channels offer, it's important to recognize how they are framing each opportunity - they may not be trying to be deceptive, but there is a certain level of word salad gymnastics going on (on all platforms).
For example: Genius Marketing Program - Not only does it stack with all other programs and promotions, but the participation requirement for the consumer is just that they have a BDC account. So, if you are participating in this program, you are extending a quick, minimum10% discount to someone who has a login to the platform and anything else that you're offering in addition is added to that. 10% can become 20% very quickly. And for BDC in particular, there's a high commission on top.
Other examples include how the benefits are explained to property managers; things like "visibility" and "traffic" and "views" and "ranking" all appear very ambiguous and are seemingly used interchangeably... But they all have specific definitions on the specific channels, so just know that the word usage is very deliberate.
“...a special badge will appear next to your property in search results and on your property page. This helps increase your visibility and can improve your conversion rate for mobile bookers.” (Mobile)
“Two-thirds of mobile bookings are made by millennials – who write more reviews than any other traveler segment. Attracting these bookers can positively impact your overall ranking on Booking.com.” (Mobile)
“Offering competitive rates in high-demand countries gives your property a better ranking in our search results.” (Country)
“They appear higher in search results thanks to a boost in page views” (Preferred)
Utilizing programs/discounts/promotions should be in response to a need. There were a few great revenue discussions that happened on other panels and sessions throughout the conference that reinforced the idea of ensuring rate is a last-ditch action... Utilizing the levers on the OTAs are helpful in those efforts but shouldn't be used without excessive caution and consideration.
The second breakout session in which I had the honor of participating was a panel discussion with Jakob Dwyer of RealJoy Vacations, Jordan Grant of Firesky Lodging Solutions, Brian Selleck of I Love Vacations, and moderated by Jacobie Olin of C2G Advisors: Industry Leader Benchmarks: Margins, Metrics, and KPIs.
This was an interesting one to me because I was the anomaly. The gentlemen I shared the stage with were definitely more high-level, ops-heavy and I was a very targeted, Revenue Management/Data voice. I did give Jacobie at least two opportunities to boot me from the panel, but he stayed the course and there I sat. Anyway, there were probably more high-level, ops things I could have shared from my experience with Natural Retreats, but out of deep respect to them (since I'm no longer employed and not really at liberty to speak to them anymore anyway), I requested that I be allowed to keep the focus to revenue management adjacent areas as they pertained to leading larger, multi-destination operators. I appreciated both Jacobie's spoken willingness to let me stay in this lane and his flexibility in real time to make that a reality.
The point of this session was to hear from people who have experience leading larger, multi-destination property management companies. The panel shared business strategies, KPIs, metrics, ideas, and best practices for maintaining scaling companies.
While I felt I was able to comment on things in real time that were relevant to the discussion that was unfolding, I do feel that there were things I said that could have been received as somewhat surface/shallow or not terribly meaningful... Regardless of the reality of the actual situation I'm in, I tend to feel that everyone thinks I'm talking too much, so I tend to try to answer quickly; which means I either gloss over what it is I really want to communicate, or I get so flustered by feeling rushed (again, only myself to blame for this since no one actually rushes me), that I omit some of the "meat" in my answers.
So with that said, here are some of the things that I MEANT to say or communicate:
With declining revenues/occupancy for many markets, what is a revenue management strategy companies should be focusing on in the next 12 months?
My answer, which I probably could have expanded on at the time, was that I felt that it was important to not rely on the things that you "know" and lean more into the data that is available to help decipher what is actually "real." That "knowing" things (how things have been historically, anecdotal knowledge of who your guests are and their booking behaviors, etc.) is still important context, but that so much has shifted over the past few years, that relying on the "knowledge" should no longer be the primary driver of strategy but the color commentary.
What I could have also added here was that because so many people were reliant on knowledge over the past few years, there were things (like booking windows) that were likely artificially controlled by behavior "as usual" and the people that were actively tracking and making moves based on data were the ones that felt the least amount of negative impact to their top and bottom lines.
How should companies look at building out a revenue management team as they continue to grow?
My answer was that, if you find the right person, I believe having someone internal (vs. outsourced) makes for stronger companies in the long run.
As an outsource option now myself, I know my answer could have been viewed as disingenuous, but I stand by it. What I will add is that I know the reality is that sometimes the right person isn't available, and I get that. In that case, I do believe outsourcing to a knowledgeable, competent specialist is probably the right thing to do (certainly vs not having anyone in the role at all); but in the long run, I do think finding that right person to lead the charge internally is ideal. For what it's worth, I think it's much easier and less risky to hire daily revenue ops help than it is to hire a revenue strategy leader, but it would be really short-sighted and foolish of me to say there's only one right way to approach any of this.
Ultimately, I think having a top-line revenue ops team with a bottom-line mindset advances companies further faster and as a general rule, that's just going to be easier to manage internally.
There was a general discussion about fees and ADR... I don't remember the exact question, but it's something I have devoted a lot of my professional career considering.
When I had an opportunity to speak on the panel about this, I remember saying that I didn't believe anyone should be working for free - meaning you need to build in margins not to gouge anyone but to ensure you're not working for free (or worse, at a loss). I also mentioned that there is a general societal pushback on fees so it's important to strike a fair balance in this regard.
Something I would have liked to lean into if I had more time (and this was a revenue management session vs a business strategy session) would have been the topic of how you share revenue with your owners - In some cases it makes sense for the PM to capture the fee margins almost exclusively (if the owners aren't charged commission for OTA bookings or if they're charged disproportionately less), but in others, it's important to be good partners and ensure that there's more of a rate lift vs a fee lift. Obviously, channel managers and PMSes have to be able to handle some of this revenue share math, but being a good partner has to be a consideration.
While I do understand why certain channels in particular are wanting fees to be low or even non-existent, I will die on the hill that I don't believe it's ethical for any business to dictate how any other business charges fees or how much they can charge. I'm fine with showing an all-in price throughout the looking process, but ultimately the issue of how much is too much seems to be an issue best suited for the booking process when the guest either books or doesn't.
I probably forgot a bunch of other stuff, too, but it's Friday at 4PM and I'm running out of steam.
Thank you to those of you who came to the sessions, who asked questions, who pulled me aside to chat, and reached out afterwards. I had a great time presenting on the two topics above (even if I feel I missed the mark on some of it) and am grateful for the opportunities.
-Sarah
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