In short: A revenue management audit analyzes five key areas: past performance (occupancy rate, average rate, RevPAR), customer segmentation, distribution mix, pricing positioning relative to the competition, and the tools used. It results in a list of quantified priorities, not just a general assessment.
Many independent hotels sense that they could boost their sales, but don’t know where to start. The audit addresses this issue. At GROOM, we never begin any project without first conducting an audit and developing a written strategy—that’s our golden rule.
Why Conduct a Revenue Management Audit?
Because revenue issues are rarely visible to the naked eye. A decent occupancy rate can mask prices that are too low during peak season, excessive reliance on an OTA, or the loss of profitable segments. Without structured data, you’re treating the symptoms rather than the causes.
What does a revenue management audit entail?
1. Historical Performance
We analyze at least twelve months of data: occupancy rate, average daily rate (ADR), RevPAR, booking rate (pick-up), and the time between booking and arrival. The goal is to understand the hotel’s actual seasonality, day by day.
2. Segmentation
Leisure, business, groups, seminars, long stays: each segment has its own price, seasonality, and acquisition cost. Vague segmentation prevents precise pricing decisions.
3. The distribution mix
What percentage comes from the hotel's website, Booking.com, Expedia, travel agencies, and phone bookings? How much does each channel cost in commissions? Is price parity being maintained? For the European context, see our article on the latest figures for hotel distribution.
4. Competitive Positioning
We build a realistic comparison set (the hotels your customers actually compare, not the ones we'd like to have as competitors) and compare prices, terms, and visibility.
5. Tools and Processes
PMS, channel manager, RMS: Are they properly connected? Who sets the prices, how often, and based on what rules? This is often where the quickest gains can be found.
What does the hotel receive at the end of the audit?
a written assessment, with findings ranked by impact;
a list of priority actions, distinguishing between those that can be corrected within a week and those that require a strategy;
a live debriefing with management to confirm priorities.
The audit is then naturally followed by a written strategy: pricing policy, distribution rules, and segment-specific objectives. This document is then used to manage pricing on a day-to-day basis, either internally or in collaboration with us.
How long does an audit take?
Allow about three weeks; part of this depends on how quickly we can access the data (PMS exports, access to the channel manager and OTA extranets).
Frequently Asked Questions
Is an RMS required to conduct an audit?
No. The audit is based on data from the PMS and the channels. It is specifically designed to help determine whether an RMS is useful—and, if so, which one.
Does a small hotel need a revenue management audit?
Yes, often more than a large one: every room that isn't sold properly has a greater impact on the bottom line, and there's rarely an in-house revenue manager.
Is shipping included?
Yes. At GROOM, distribution is an integral part of the audit and strategy.
Where should I start?
Discover our revenue management and distribution solutions, or run a free scan with GROOM Compass to get an initial overview of your online presence.