Revenue Management Terms

Hello All,

Today I would like to post few important terms been used in Revenue Management basic but very useful and handy

Following are the terms:-

1. ADR - Average Daily Rate
2. ARR - Average Room Rate
3. ARI - Average Room Rate
4. BMR - Bench Mark Rates
5. ROD - Rate Of the Day
6. CRO - Central Reservation Office
7. CRS - Central Reservation System
8. ConPOST - Contribution Per Occupied Space & Time
9. MS - Market Share
10. FMS - Fair Market Segment
11. Denials - Business refused by the hotel
12. Regret - Client refused the hotel
13. GDS - Global Distribution System
14. GOP - Gross Operating Profit
15. Hotel Code - 2 letter word
16. IDS - Internet Distribution System
17. KPO - Key Performance Objective
18. LOS - Length Of Stay
19. LRA - Last Room Availability
20. MPI - Market Penetration Index
21. OTA - Online Travel Agents
22. RevPAR - Revenue Per Available Room
23. RFP - Request For Proposal
24. TPI - Third Party Intermediary
25. RevPost - Revenue Per Occupied Space & Time


Please take notes of the above mentioned terms as they are most commonly used terms in Revenue Management, in my next post I will add formulas and will try and make it more intellectual

Hotel Revenue Management - Segmentation

Revenue management is a vast subject, we will cover all the aspects of revenue management in post by post.

Today i will share Market Segments

What is Market Segment : it is useful to target and market to the different customer with different requirement at price point to match their budget, each segment will have a different budget and needs.

Segmentation is required to maintain the MIS for the hotel, it is important to understand the nature of the business.

On PMS (Property Management System) set up a segment report, each individual reservation need to be tagged with right market segment.

List of Segments as as under:-

1. Rack Rate / Best Available Rate - No discount booking

2. Transient - Discounted against rack rate

3. Long Stay - any special rate extend to a booking more then 14 *nights length of stay

4. Corporate - Contracted

5. Govt, Defence, High Commission

6. Leisure Package

7. Leisure contracted

8. Whole sale - 3rd parties like expedia, travelocity etc on allotment basis (B2B)

9. MICE - Meetings, Incentive, Conference & Exhibition

10. Airline - Crew, STPC, Extended etc

11. Complimentary & Houseuse

Please note that by and large above mentioned terms are used in various hotels , one need to set standards and specs. before configuring segmentation on PMS

Should you need further assistance or clarification on the above please feel free to contact @ shivram.kothari@gmail.com