Article: On Boom: Revenue managers in hospitality sector


On Boom: Revenue managers in hospitality sector

There is going to be a huge demand of revenue managers and not only will the salaries increase, the dynamics in the role of the revenue managers will change due to the rapid changes in technology and digital transformation.
On Boom: Revenue managers in hospitality sector

Revenue Management or the art of “Right Pricing” at the right time is pertinent not just to Hospitality but across any business. In fact, it makes logical sense to base your price in line with factors like competition, seasonal demands or any other elements that directly affect a business’s sales. 

India offers a highly diverse and dynamic playing field as far as the Hospitality industry is concerned. A variety of segments including Luxury Chains, Upscale, Mid-segment Chains, Boutique Resorts, Budget hotels and aggregators vie for market share and mind space across Tier I, II, III cities catering to varied demographics. 

Traditionally, Revenue Management was in play mostly by Luxury Hotels however, today, hoteliers across segments have realized the significant role that a strong Revenue management vertical plays. In fact, an increasing number of Mid-segment and budget hotel chains are strengthening their revenue management teams in order to ensure optimal revenues at all times. The scale they have achieved makes it critical for them to constantly gather market intelligence and optimal yields across locations.

The Roles that the Revenue team plays are multifold. This depends on the objective that the hotel is aiming to achieve – whether to increase occupancy during lean periods to getting the best returns during times when rates are generally going strong. 

Dynamic Pricing – revenue teams need to be agile and need to know the pulse of the market at all times during the day as rates could vary during the day. A recent survey suggested that close to 70 % of the customers today, make their hotel bookings online, and at times, within 2 weeks of their intended stay. Hence, the concept of a standard price per day has become archaic paving the way for the radical “Dynamic pricing” which is done basis keeping a constant check on demand and consequently varying prices. At times, the price of the same room may change 2 – 3 times a day.

Revenue Managers today need to be strong on demand forecasting. They need to comprehend how each location will play out during the year and hence, need to be agile and extremely responsive to varying locations and customer spend patterns whilst also keeping in mind prices being charged by other competing hotels in each specific location.

Another key aspect of revenue management is technology. Thanks to various data points spread across the span of an organisation’s operations, there is a large amount of information coming in which needs to be filtered, collated and integrated into meaningful components for future strategy.

In times to come, we will see Revenue managers gain further prominence as part of the core think-tank of any Hotel organization.

However, there is no standard background towards becoming a Revenue Management professional. In most cases, Revenue managers are Hotel Management graduates, although they could also be commerce graduates who step into Sales / Front Office operations for a few years before transitioning into Revenue management.

In the recent past, one has also come across at youngsters who have started their careers within Revenue and have moved up the ladder to becoming Regional Heads in the same field. Strong Number Crunching abilities complemented by a keen sense of Demand Forecasting & Relationship Management make for an effective revenue manager. 


  • Making strategic sense of the large amounts of data (Reg. consumer spend patterns , booking volumes, competition etc.) pouring in. Although modern technology based RMS (Rev management Systems), to a great extent, assist in daily data crunching and hence, reduce the work load on Rev Managers themselves.
  • Constant Demand forecasting across locations
  • While there have been advancements, Revenue is still underserved as far as technology is concerned.
  • With customers constantly getting attracted by lower rates / discounts, a big challenge for RMs is to maintain the “right price” without compromising on the bottom line.

There is going to be a huge demand of revenue managers and not only will the salaries increase, the dynamics in the role of the revenue managers will change due to the rapid changes in technology and digital transformation. 

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Topics: Recruitment, Employee Engagement

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