Frasers Hospitality is collaborating with revenue strategy platform Duetto to develop what’s said to be the first revenue management system that uses open pricing to optimise rates for contracted extended stays in additional to traditional short stays.
To be made available in Duetto’s cloud-based GameChanger app, the feature is expected to help Frasers more efficiently balance revenue management strategy between long and short stays, and will be implemented across Fraser’s global portfolio.
Instead of traditional fixed-tier pricing where rates for different sales channels are derived from a single best available rate, open pricing allows accommodation providers to price all room types, channels and dates independently of each other based on actual demand.
By offering more flexibility in rate adjustments, this also means that guests are not turned away during peak periods when operators would normally close channels or add length-of-stay restrictions rather than sell discounted rooms.
Rates for the extended stay segment are typically inflexible and fail to account for the displacement of transient business and longer, more profitable longer-staying guests, according to Frasers.
Currently in beta stage, the new app module will be able to recommend an optimised rate and negotiation range for extended stay contracts after factoring in various costs.
The system is also expected to help hotels overcome manual data analysis, as well as allow for better prediction of demand that goes beyond historical guest records by leveraging third-party data such as web shopping behaviour, air traffic and weather to gauge price sensitivities and recommend optimal room rates.
This is part of a larger initiative that Frasers is embarking on to gain more insights into demand and boost its pricing and distribution strategies as it scales up its global portfolio, according to senior vice president, head of global marketing & sales, Joanne Ang.