Revenue Management: A Brief History
September 25, 2016 3:55pm
By Howard Hian
When I began in the hotel business in the early 1970s in San Diego, revenue management wasn’t even a phrase. In its primitive state, it was a loose practice. When more tourists visited, a hotel would simply raise room rates. In summer how we loved the people from Arizona! Then there were weekends and special events (anyone remember the Cool Jazz Festival?). Sometimes minimum stays were even required over holidays. Wow! Someone much earlier in the history of economic theory called it “supply and demand".
Then about 15 years ago or so, some suit dreamed up the position of Revenue Manager. Usually, the front desk or reservations manager was given this job/title which, of course, they’d already been doing. Introducing a revenue manager to a guest is like saying, “Hi, here’s the person who is going to squeeze every penny out of you.” It makes me all warm and fuzzy. Now, sophisticated software programs continually determine rates.
I recently heard one of the best revenue management stories ever. I was visiting Sorensen’s Resort in Hope Valley, CA to write a travel feature. It’s a quintessential mountain getaway; cabins, hiking, gorgeous views, etc. The owner (since the early 80s) told me that the previous proprietor had his own unique way to determine nightly rates. He would watch as cars drove onto the property and charge according to the model! Guess who paid more, the Chevy or the Caddy! That’s really imaginative, old school revenue management.
Tags: revenue management,
Howard Hian is an award winning journalist, affiliated with the North American Travel Journalists Association and the International Travel Writers Alliance. He was a long-time member of the San Diego Hotel Motel Association and served as an allied representative on their Board of Directors. In 2012 he was the San Diego hotel industry’s Allied Person of the Year. Hian writes a monthly travel feature for The Military Press. His column also appears online at Travel Savvy West, Real Travel Adventures and Roadtrips for Couples. In late 2015, his app, Poker Tutorial: Omaha 101Plus An Insiders Guide to Reno, won a gold in the app category in the North American Journalists Associations annual competition. He believes his secret to writing a good story is having an in-house proofreader and editor (his wife).
Contact: Howard Hian
Vertical Booking Adds More Than 1000 New Hotels in 2017
SHR 2017—Another Year of Growth and Innovation
The Unfinished Business of Revenue Management: Investment Abandoned
Shifts In Revenue and Expenses Improve Hotel Food and Beverage Profits
IDeaS G3 RMS Gives New Revenue Opportunity to Resorts and Hotels with Component Room Optimization - an Industry First
IDeaS Learning System Recognized With Gold Award From Learning & Development Research Firm Brandon Hall
More Than 10,000 Hotel Properties Worldwide Rely on IDeaS' Advanced Analytics for Confident Revenue Management
Desbravador Integrates TravelClick’s iHotelier Central Reservations System into its Property Management System
PMS Software Evaluation Scorecard Ensures Hotels Can Find Their Ideal Property Management System
Hospitality Financial Leadership - Global Hotel Revenue Management
Hotel Occupancy Continues to Reach New Heights but Rate Not Keeping Pace
Provenance Hotels Chooses IDeaS G3 RMS to Advance Revenue Strategy in 2017
the D Las Vegas Increases Profitability and Efficiency with Revenue and Profit Optimization Solutions from The Rainmaker Group
The Rainmaker Group to Showcase Hospitality Revenue and Profit Optimization Cloud at HITEC 2017
Hotelsoft Expands Its Development Center, Beefs Up Offerings
You're Invited to Rethink Your Hotel Technology with ALICE & Duetto
The Rainmaker Group Solves Revenue Management Challenges to Bolster Growth at Westgate Las Vegas
The Rainmaker Group Maintains Leadership Position in Hospitality Pricing Optimization and Intelligence Sector with Record Setting Growth in Q1 2017
The Rainmaker Group to Present Total Revenue Management Approach for Casino Hotels at INFORMS 2017
nSight for IDeaS™ Helps Hoteliers Drive More Profitable Bookings by Tapping Forward-Looking Travel Intent Data
Please login or register to post a comment.