How Should Hotels Set Room Rates Now and After the Coronavirus Crisis?
Photo Credit: Shown here is The Chatwal, a Luxury Collection Hotel, in New York City. Many hoteliers face tough decisions about how to manage their room-rate setting during the coronavirus crisis. Marriott International
Skift Take
Granted, this crisis is unprecedented. Yet hotels worldwide can learn lessons from how hotels have faced regional shutdowns, such as in Asia-Pacific in recent months, in Las Vegas after the shooting rampage, and elsewhere after hurricanes and financial crises. Managing room rates and marketing offers is critical to making the most of a rebound in demand.
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Take Heart From Asia "Asia-Pacific learned a lot by going through the SARS experience, and as a result, most had a plan for facing some of the same challenges," said Sherri Kimes, emeritus professor of service operations management at Cornell University. Kimes surveyed more than 500 hoteliers worldwide, which she presented in webinars run by Revinate. Her survey showed that actions taken by hoteliers in Asia-Pacific in the past few months have broadly differed than those taken elsewhere. Westerners have been more quick, on average, to cut rates to stimulate demand, while operators in Asia-Pacific have favored other measures. A case in point: About half of Asia-Pacific hoteliers tried "value-adds," compared with only a third in Europe. An example of a "value-add" could be offering any guest who stays a voucher for, say, a substantial credit if they rebook a future stay within a year, or it could be offering a free airport transport in a well-sanitized vehicle. Kimes is currently based in Singapore. "Yes, there was panic here," she said. "But I'd say it was much more controlled because t