By Sahad Kassam
As much as I would like to say that 2020 has been a rollercoaster, I would be remiss to not acknowledge those in the hospitality industry, who have yet to see the upside. In March of 2020, the hotel industry collapsed. Hotels were seeing cancellations come in large waves, and employees were being furloughed by the dozen, flooding the job market in search of a transferable role. As a 2019 Bachelor of Commerce graduate beginning my full-time career with Marriott International’s Revenue Strategy Market Team for Downtown Toronto, COVID-19 turned my exciting and limitless career opportunities into a giant question mark.
With so much newfound uncertainty in my future, I had to think long and hard about my transferability and how to articulate that to a non-hotelier. After all, Revenue Management is a relatively new field and therefore lacks the seamless title transfer that a Customer Service, Finance, or Marketing role would garner. When speaking with my peers, I realized most Revenue Management Professionals were dealing with this issue. Were we data analysts, strategy consultants, pricing specialists, distribution managers, asset management professionals, or members of one of the countless other specialties?
Perhaps, this disconnect is due in large part to (1) the niche specialization of the discipline and the lack of a transferable title in other industries; (2) a lack of understanding of the hotel industry; (3) the continuous evolvement and agility of the practice.
(1) The Niche Specialization of the Discipline and Lack of Transferable Title in Other Industries
A number of roles in the hotel industry take on more generic business titles such as Customer Service, Marketing, Finance, Engineering, etc. The niche specialization and therefore difficulty in describing the role of a Revenue Manager to networks outside of the industry, often leads these professionals to simplify their role into a short collection of verbs that may seem overly technical and specialized, with limited transferability.
(2) People’s Lack of Understanding of the Hotel Industry
The hotel industry thrives by making the guest experience as seamless as possible; however, the industry’s success in displaying that seamlessness can lead to a lack of understanding of the complexity of a hotel operation.
(3) The Continuous Evolvement and Agility of the Practice
Starting as a role that heavily focused on manual data entry, to a role that now leverages big data, artificial intelligence (AI), and machine learning to guide strategic discussions, the Revenue Management Profession has greatly evolved within the last 30 years. Likewise, the needs of the practice vary based on demand, requiring the Revenue Manager to remain agile, leveraging a wide range of skills.
Revenue Managers are often employed by Hotel Management companies who are incentivized based on the financial performance of a hotel. Consequently, Revenue Managers are tasked with being strategic business partners, and in some cases providing consulting and advisory services, to hotel executive committees, asset managers, owners, and investors. Revenue Managers rely heavily on market demand data in order to provide business projections, along with actionable strategies and tactics to achieve maximum profitability and market share capture, while also accounting for the perishability of hotel rooms. As such, while the creativity of strategies and tactics may be based on each hotel’s independent identity, a Revenue Manager relies on pricing, inventory and distribution, and strategic planning as their primary strategic levers.
Pricing: like Pricing Specialists, Data Analysts, or Asset Management Professionals, the Revenue Manager conducts market research, collects and translates large amounts of data, creates detailed financial models, and relies on business indicators to identify trends and make adjustments to pricing, maximizing sales and margin.
Inventory and Distribution: like Distribution Managers, Revenue Managers maintain strong relationships with third-party distribution channels that often provide great exposure and serve as demand generators at a commissionable cost, while also prioritizing less costly direct business to consumer distribution channels. By managing inventory availability and distribution, Revenue Managers are able to control costs, drive business volume, and maximize profitability.
Strategic planning: like Strategy Consultants and Asset Management Professionals, Revenue Managers help brands and ownership groups formulate and achieve business strategies related to product positioning, market share capture, and asset performance. As part of the strategic planning process, Revenue Managers provide revenue forecasts to manage uncertainty and identify growth opportunities. Additionally, Revenue Managers work with hotel teams to layer in the highest and most consistent sources of business, while keeping client needs in mind. This is a vital facet of a Revenue Manager’s job— ensuring that the hotel is not only placing heads in beds to drive topline performance, but also managing the customer mix to secure the bottom line, brand positioning, and long-term strategic vision for these complex assets.
Revenue Managers serve as business leaders for the hotel industry, collaborating with all levels of the hotel to ensure strategic alignment and to provide a data-backed consultative lens to any decision-making that occurs on an operational, investment, and brand management level. As one of my mentors once said to me, a Revenue Manager is all about being ‘a geek who can speak.’
While Revenue Management remains a niche specialization, the practice itself champions a range of easily transferrable skills. Though this may be a time when ‘the perfect fit’ is prioritized over ‘the business leader,’ I am confident the Revenue Manager will persevere. I hope this article gives each of you, especially my peers who may have been negatively affected by the pandemic, a slightly better idea of the expansive transferability of a Revenue Manager.
