Article: 5 reasons NOT to follow your competitors’ prices July 2nd, 2014
Another misconception that is still prevalent among hotels of all sizes and star ratings is that in order to be priced accurately, one needs to follow their competitors’ rates. Unfortunately, this point of view is also shared by large hotel management companies, hotel chains and even some Revenue Management companies.
The general logic behind this point of view is normally the following: the prices that your neighbors are charging for their hotel rooms comprise the supply and affect the market conditions. Overall, there’s nothing wrong with this statement. Definitely, for the correct understanding of the hotel’s position in the market, it’s important to be aware of the rates that your competitors are charging for any given day in the future. However, in many cases, following their prices blindly draws you away from the optimal market price (based on real supply and demand), and actually makes your hotel lose money.
- Results and case studies
- Promotions and offers
- Education and training