Originally Posted by
uElliots
understanding that you were giving us the 40,000 foot version, thank you
my 40,000 foot question based on the above is
total revenue, each room having some sort of occupancy no matter the rate would increase total revenue, would it not?
occupancy, again, each room would increase occupancy correct?
each room bringing in additional revenue would increase revpar right?
for example, if you had 100 rooms and each were at your rack at 100 dollars then you would max out at a revenue of 10000 dollars, with a 100% occ rate and a revpar of 100
if you had 60 rooms at 100 dollars and thats it then the rev would be 6000 dollars 60% OR and a revpar of 60 per room? is this correct
so why not have 60 at 100; 20 at 75 and 20 at 50?
this would make it revenue of 8500, OR at 100% and a revpar of 85 or am i way out of whack here?
I think the key takeaway from
nzed's extremely well written and informative post as it relates to your situation is that hotels will not openly advertise/provide a pricing position that dilutes the value of their brand regardless of occupancy rates (hence the use of opaque channels to fill last minute availability). Consumer expectations shift over time and if people become accustomed to Marriott service at Fairfield rates the ability of Marriott to command a premium for their top-tier brand diminishes.
Are you negotiating a national contract rate with the hotel chain's sales group or are you negotiating a local rate with an individual operator? What is your account's expected volume? Those and other factors will affect the considerations the hotel is willing to provide
within their overall pricing strategy.