Dynamic Hotel Pricing Corporate Strategy

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(No Transcript)
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Dynamic Hotel Pricing -Corporate Strategy

• Dr. Zinan Liu
• Director of Sales and Account Management
• HRG China

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What is flexible pricing?
FLEXIBLEPRICING
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How does the flexible pricing model vary
MARKET RATE (OLD RACK RATE) CEILING RATE WITH
LRA THE RATE CAN FLUCTUATE BELOW (SUBJECT TO
AVAILABILITY)
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OFF MARKET RATE THAT FLUCTUATES WITH NO CEILING
(LRA) RATE
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MARKET RATE WITH NO CAPS (MOST DANGEROUS)
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Who offers flexible pricing
DO

• INTERNATIONAL CHAIN
• NATIONAL CHAINS
• SOME REPRESENTATIONCOMPANIES

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What do the hotel groups want to do next?
APPLY THE FLEXIBLEPRICING MODEL TOCORPORATE
RATES
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2 Different strategies
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Economics perspective
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Air analogy

• Lowest fixed rate 80 of full fare
• Average discount fare lt 70 of full fare
• Saving strategy Combination of air deals and
  spot buy

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Corporate hotel strategy

• Mixed deals
• Fixed rates for properties with high volume and
  BAR for properties with low volume
• BAR provides benchmark for fixed rate negotiation
• Search for lowest room rate among pre-specified
  properties
• Policy compliance is key