Yield Management

Yield management is a dynamic pricing strategy the hospitality industry uses to maximize revenue. It’s a data-backed approach that’s all about selling the right room to the right guest at the right time (and for the right price!).

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It involves analyzing demand, booking patterns and inventory availability to adjust rates in real time. This lets hoteliers optimize occupancy and revenue. To put it simply, yield management means charging more when demand is high and offering discounts when demand dips so hotels get the most value out of every available room.

The Meaning of Yield Management in Hospitality

Yield management is when hotels match room pricing with consumer behavior. For example, room rates may increase for periods when hoteliers expect an uptick in bookings (like holidays or major events) and decrease during slower seasons or weekdays. This strategy relies on knowing information like:

 
•    Historical booking data  
 
•    Market demand trends  
 
•    Lead time and booking windows  
 
•    Room availability and occupancy rates  
 
•    Guest segmentation and willingness to pay  

Yield Management vs. Revenue Management: What’s the Difference?

These two terms are often used interchangeably, and while they’re both important, they’re not the same. Yield management pertains specifically to pricing and inventory optimization based on demand. On the other hand, revenue management is a broader strategy that can include yield management, but also includes forecasting, distribution and strategic planning across all of a hotel’s revenue streams.

Benefits of Yield Management for Hotels

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Implementing a yield management strategy is a key element for hotels looking to stay competitive and create a comprehensive revenue management plan. It allows hotels to

 
•    Maximize room revenue by adjusting prices to match demand in real-time  
 
•    Improve occupancy rates during both busy and off-seasons by targeting the right segments with the right offers  
 
•    Increase profitability without expanding inventory or cutting costs  
 
•    Respond quickly to market changes with data-backed pricing decisions  

How Canary Helps Hoteliers Optimize Yield

Yield management is just one element that helps hotels increase revenue without increasing overhead. Canary optimizes the full guest journey so hoteliers can increase their revenue per available room (RevPAR) in ways that go beyond nightly rates:

 
•    Dynamic Upsells increase spend during and after booking through the power of AI  
 
•    Mobile Checkout helps hotels get more third-party reviews, which correlate to more bookings  
 
•    Guest Messaging offers upgrades and last-minute deals, and can be fully automated to create a low-lift process  

If you’d like to learn more about how Canary can help you maximize revenue and enhance the guest experience, book a demo with us today.