Hotel total revenue management is often described as the next step for Revenue Management. But perhaps the real opportunity is not simply to optimise more revenue streams. It is to look at the entire guest journey and identify where value and revenue are currently being lost.
Hotels have become highly sophisticated at managing room revenue. Occupancy, ADR and RevPAR are monitored closely, supported by increasingly advanced technology and data.
But the guest does not experience a hotel as a room.
They call before booking. They receive communication before arrival. They eat, drink, park, upgrade, book experiences and use hotel services during their stay. And the relationship does not necessarily end at check-out.
Each of those interactions creates an opportunity.
And each can also become a point where revenue disappears.
At Global Revenue Forum Amsterdam, Pål Byberg, Territory Director at Canary Technologies, explored what happens when hotels start looking beyond RevPAR and manage revenue across the entire guest journey.
We explore:
For decades, hotel Revenue Management has been built largely around rooms.
How many rooms can we sell?
At what price?
Through which channel?
How do we maximise occupancy, ADR and RevPAR?
Those questions remain important. But they capture only part of the value a guest can create.
A guest may pay €200 for a room and spend nothing else.
Another may pay €180, but also book parking, dinner, an upgrade, an experience and late check-out.
Which guest created more value for the hotel?
Once we start asking that question, the perspective changes.
The objective is no longer simply to optimise the room transaction. It becomes understanding and optimising the total revenue opportunity surrounding the guest.
One of the most interesting aspects of Pål's session was that Total Revenue Management was not presented simply as finding new things to sell.
Sometimes the revenue opportunity already exists.
The hotel simply fails to capture it.
The whitepaper highlights examples such as unanswered telephone calls, missed upselling opportunities, underutilised amenities, lost food and beverage spend and limited guest engagement.
That changes the question.
Instead of asking:
What else can we sell?
Hotels can start asking:
Where in our existing guest journey are we making it unnecessarily difficult for guests to buy?
That could be a booking enquiry that nobody answers.
An upgrade the guest would happily have purchased but was never offered.
A spa treatment with availability that the guest never knew existed.
Dinner at the hotel restaurant when the guest instead went elsewhere.
Or an early check-in that could have created both convenience for the guest and additional revenue for the hotel.
Individually, these may look like small opportunities.
Across hundreds or thousands of guests, they become something much bigger.
One of the limitations of thinking purely about the stay is that many purchasing decisions happen before the guest reaches the hotel.
The guest may already know they need parking.
They may be thinking about dinner.
They may want to arrive early.
They may be celebrating something.
They may be looking for activities at the destination.
The opportunity is therefore not simply to have those products available. It is to surface them when they are relevant to the guest.
This is where guest engagement becomes part of the commercial strategy.
Pre-arrival communication, messaging and digital guest journeys create opportunities to connect guests with services they might genuinely value.
During the stay, those opportunities continue.
And even after departure, the relationship with the guest can create future value.
The Total Revenue Journey Framework in the whitepaper therefore connects pre-stay, in-stay, guest engagement, ancillary spend and ultimately TRevPAR.
There is an important distinction here.
Total Revenue Management can easily become a conversation about upselling.
How can we get the guest to spend another €20?
But that risks approaching the guest journey from the wrong direction.
The more interesting question is:
What does this guest need, and can we make it easier for them to get it?
A guest arriving early may value guaranteed early check-in.
A family may value breakfast being arranged before arrival.
A business traveller may appreciate parking information before setting off.
A couple celebrating an anniversary may genuinely want the upgrade or restaurant reservation.
In each example, the hotel creates additional revenue.
But the guest also receives something they value.
That is where Total Revenue Management becomes much more interesting than simply selling extras.
Of course, doing this manually for every guest is difficult.
This is where technology becomes increasingly important.
The whitepaper highlights the role of AI and digital guest engagement in identifying and capturing ancillary revenue opportunities while creating a more seamless guest experience.
Automation can help hotels surface relevant services at different stages of the journey without requiring hotel employees to remember every possible sales opportunity for every guest.
But technology alone is not the strategy.
Hotels first need to understand:
Where are our revenue opportunities?
Where are we currently losing them?
Which services actually create value for our guests?
At what moment are those services most relevant?
Only then can technology help make the process scalable.
Perhaps one of the biggest organisational challenges is that these revenue streams traditionally belong to different departments.
Rooms belong to Revenue Management.
Restaurants belong to F&B.
Spa may have its own team.
Parking may barely be considered a commercial product at all.
Guest communication may sit with Front Office, Marketing or Operations.
But the guest does not see those organisational boundaries.
They see one hotel.
That means hotel total revenue management requires greater visibility across revenue streams and closer collaboration between Revenue Management, commercial teams and operations.
The whitepaper translates this into practical actions: Revenue Managers can measure revenue beyond rooms and identify leakage; commercial leaders can move from room-centric to guest-centric thinking; and operations teams can make hotel services easier for guests to discover and purchase.
Perhaps the biggest shift is not from RevPAR to TRevPAR.
It is from room-centric thinking to guest-centric thinking.
The room remains an essential revenue stream. But it is one part of a much larger commercial relationship.
Hotels already have restaurants, parking, spas, upgrades, experiences, meeting spaces and services that guests may value.
The opportunity is to connect the right guest with the right product at the right moment.
That requires hotels to look beyond what was sold and start examining what could have been sold, what the guest needed and where friction prevented the transaction from happening.
Because sometimes the next revenue opportunity is not a new product.
It is an existing opportunity that the guest never saw.
The whitepaper Beyond RevPAR: Mastering Total Revenue Through the Modern Guest Journey summarises Pål Byberg's session at Global Revenue Forum Amsterdam and includes practical actions for Revenue Managers, commercial leaders and operations teams.
