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How Rate Yield Works
When we consider the uses of artificial intelligence in hotels, the first thing that comes to mind is AI in pricing through revenue management systems. Computers can ingest millions of data points, analyze them and act on them 24 hours a day. But if we go back to the basics, Artificial Intelligence is defined by Merriam Webster as “the capability of a machine to imitate intelligent human behavior”. At Rate Yield, we work with intelligent revenue managers to train our AI to act on their behalf, so that they can grow profits with confidence, automatically.
Every hotel using Rate Yield first starts by defining their competitive set. This group of hotels is assigned an individual level of significance in relation to their importance in the hotel’s ecosystem. This competitive set can also vary by day of week or by season to ensure a relevant benchmark rate is calculated 365 days per year.
Next, the revenue managers will set thresholds to confine the AI to a rate range in which the hotel is comfortable. These thresholds vary by day, month, season, or room type. Once these are in place, a Rate Yield revenue manager will work with the Hotel revenue manager to define strategies by booking window and occupancy level. These strategies determine how the hotel’s rate will react to the benchmark rate, given the hotel’s own performance.
After property-level strategies are in place, room-type specific strategies can be honed to ensure the highest revenue attainment across all categories. For example, rooms with two beds are typically in higher demand on the weekend than during the week and setting up rate variations accordingly will allow the hotel to yield more revenue.
Rate Yield offers a unique approach to an RMS with a strong focus on current market dynamics and very little focus on the historical trends, given the volatility in recent years. This means pricing is more in line with consumer expectations when they are shopping. Also, by focusing on market rates and dynamics, a hotel working with Rate Yield can see a return on their investment in a very short period of time. There is no need to train the AI on historical data and given that the implementation process takes a total of 4 hours over a 7 to 14-day time span.
But don’t take our word for it, here is what one of our most recent clients, Lucie Manceau from Hotel Birks Montreal, had to say about Rate Yield:
“Since the implementation of Rate Yield, we are seeing a significant increase in our pick up and revenue. Rate Yield adjusts our rates to consistently be competitive. It is very simple to use and allows us to take into consideration multiple factors, like our competitors, our strategies, and putting threshold rates in place. The interface is intuitive and easy to use. Maximizing our revenues has become simple and with a significant amount of time saving.”
Rate Yield is an affordable and flexible RMS, offering time savings, optimized rates, flexible strategies, and many additional features. Reach out to sales@rateyield.com to learn more.
Rikki Cavanagh is the Director of Sales, Marketing & Business Development at Rate Yield. Connect with Rikki on LinkedIn.
About Rate Yield
Rate Yield was created in 2019 by seasoned Revenue Management consultants with over 30 years of experience within the field. Rate Yield RMS was designed to adapt to small hotels, inns, resorts as well as large hotels in city centers. With settings and thresholds that can be modified against a hotel’s unique market trends, Rate Yield makes it more accessible than ever to implement AI in revenue management strategies. With real-time insights, agile strategy development, modules for budgets and forecasts, as well as a tool for displacement analyses, Rate Yield provides a complete software that will help your hotel to yield more revenue, period! To learn more, visit us at www.rateyield.com.