City Center Hotel - A Case Study

3* Town Center Hotel

A Case Study

In 2019, a unbranded hotel in a historic town sought help from Revenue by HRM to address declining revenues. The hotel, featuring 34 rooms, a restaurant, bar, and lounge, was experiencing year-on-year decreases in Average Daily Rates (ADRs) and overall revenue, particularly during the typically high-demand summer months.

Challenges

  • Significant revenue decline during peak periods.
  • Suspected mid-week booking gaps.
  • Need for both immediate and sustained revenue growth.

Approach - Short Term Strategy

  • Price Position Reassessment: Adjusted daily room rates to remain competitive, replacing an outdated static pricing system.
  • Online Presence Optimisation: Improved rankings on booking sites through updated images and accurate property information.

Results - Short Term - within 3 months

  • Net room revenue increased by 5%.
  • ADR grew by 4.8%.

Approach - Long Term Strategy

  • Optimised Pricing Strategy: Implemented over 12 months to maximize revenue during high demand periods.
  • Weekly Revenue Calls and Reports: Ensured staff alignment and strategic focus.
  • Day-of-Week Pricing Reviews: Captured longer lead-in business and maximized customer stay length.

Results - Long Term - within 12 months

  • December: Net room revenue up 23%, occupancy up 12%, and room rates up 14%.
  • January: Net room revenue increased by 29%, occupancy by 22.8%.
  • February: Net room revenue surged by 27%.

Client Feedback

The hotel owners were highly satisfied with the results, noting significant revenue increases and the ability to weather market stagnation. The partnership, which has continued for over five years, has successfully navigated industry challenges including Covid-19 and a major refurbishment.

Conclusion

Revenue by HRM’s strategic interventions not only mitigated short-term losses but also established a robust framework for sustained revenue growth, proving essential for the hotel’s financial revival and long-term success.