Rentals United reinvents revenue management as the key to optimizing short-term rental performance

BARCELONA – Revenue Success Management is a new approach to business strategy for vacation rentals, which ties revenue management (pricing strategy) with distribution strategy. The ultimate goal of revenue success management is to sell the right product, to the right customer, at the right time, for the right price, on the right channel.

The COVID-19 pandemic has created a need for a new way to look at revenue management, since the KPIs that were historically considered important are no longer useful. For example, ADR is becoming more important, while RevPAR is losing its relevance. The issue with RevPAR is that it’s a backward-looking metric that can’t be used to make decisions about the future.

This shift in business approach created by such a big change event necessitates that instead of looking at historical data, property managers need a more reactive and experimental approach. Data is the driving force behind this strategy. This approach predicts guest behaviour by analysing data on availability and pricing while simultaneously digging down into performance by channel. The ultimate aim of boosting revenue will be to maximise profits.

The crux of Revenue Success Management is that revenue management strategies should always be intrinsically linked to your distribution strategies. With the help of data, property managers can navigate property/content composition, booking performance pickup, booking windows, cancellation details and other aspects to fine-tune your product and finally start seeing results.

Doug Truitt, Head of Revenue Success at Rentals United, says, ”We developed the approach of Revenue Success Management as a more holistic look at business health with a hybrid analysis of revenue management and distribution strategies. For companies who want to reach the next level of not just business understanding but full maximization of business potential, using data in this way is critical. Data Studio hopes to help companies achieve this level of sophistication.”

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