Best available rate (BAR) was the most commonly adopted strategy for pricing hotel rooms back in the 90s, but as the hospitality industry has evolved and become a sophisticated digital ecosystem of OTAs, own brand channels, and systems, a new pricing model was needed.
Enter Open Pricing.
Our Open Pricing methodology provides you with the ability to yield room types based on demand, and it’s a further evolution of the traditional best available rate (BAR) strategy that came out in the 90’s.
Open Pricing provides you with unparalleled flexibility to maximize both revenue and guest satisfaction.
Read on to find out more as we dispel some of the myths associated with Open Pricing.
Open Pricing in a nutshell
Open Pricing is a strategy that breaks free from traditional, fixed BAR pricing. In a conventional model, every rate is a fixed modifier of a single base rate. For example, a 15% discount on a $100 BAR forces a rate of $85, with little room for nuance.
With Open Pricing, you can set rates at any BAR level. You’re free to dynamically adjust prices across segments, channels, and room types. This means you can implement different strategies across rate codes, from static rates for contracts to fully dynamic rates that react to real-time demand.
In essence, Open Pricing gives you the freedom to price strategically rather than reactively. It ensures every room is sold at its most profitable price, minimizing revenue leakage, and adapting seamlessly to changing market conditions.
4 common myths about Open Pricing
Myth 1: Open Pricing means no inventory controls
Open Pricing and inventory optimization work together
A common misconception is that Open Pricing means leaving all rate plans open at all times. In reality, Open Pricing is about strategic flexibility, allowing you to dynamically adjust rates across segments, room types, and channels while still applying smart inventory controls like length of stay (LOS) restrictions and close to stay restrictions.
You should never have to choose between pricing optimization and inventory controls. With Open Pricing, you get the best of both worlds — accurate demand-based pricing while still prioritizing your most valuable guests.
Myth 2: Traditional inventory controls always outperform Open Pricing
Rigid LOS restrictions can leave revenue on the table
Some claim that setting strict LOS restrictions is the key to profitability, but in a world where guest demand is increasingly dynamic, static restrictions can lead to missed revenue opportunities.
- What happens when a guest is willing to book a one-night stay at a premium rate, but strict restrictions force them to book elsewhere?
- What about guests who would extend their stay if pricing was flexible enough to accommodate them?
Open Pricing enables hotels to capture both short- and long-term demand efficiently, ensuring that every booking contributes to total revenue optimization.
Myth 3: Open Pricing leads to insult pricing and poor guest experience
Open Pricing aligns prices with willingness to pay
One argument against Open Pricing is that it leads to exorbitantly high rates on peak nights, alienating customers. But this assumption misunderstands how price elasticity works.
Hotels using Open Pricing have full control over guardrails and rate ceilings to ensure pricing remains competitive and fair. Rather than insult pricing, with our methodology you can find the optimal price that guests are willing to pay, maximizing revenue while maintaining trust.
In contrast, rigid pricing models often force hotels to either turn guests away or undervalue their rooms, especially when there are artificial demand restrictions in place despite having availability. To better understand what business you’ve turned away, you need to see your web regrets and denials during restriction periods — a unique feature of our revenue management system — broken down by length of stay, price point, rate code, room type, and country. With Open Pricing, you can stay competitive without needing these restrictions in place.
Myth 4: Open Pricing doesn’t consider profitability
Open Pricing maximizes both revenue and profitability
Open Pricing isn’t just about increasing rates. It’s about optimizing business mix and profitability through:
- Segment-based pricing: Prioritizing high-profit direct bookings over high-cost OTA bookings.
- Channel and demand optimization: Aligning promotional and distribution strategies with profit margins.
Unlike traditional pricing strategies that rely on rigid discounts, Open Pricing dynamically adjusts pricing to maximize both revenue and profitability across all revenue streams.
Open Pricing is the future of revenue management
The hospitality industry is evolving rapidly and relying on traditional BAR methods developed nearly 30 years ago that ignore guest willingness to pay, will leave revenue on the table.
Rather than looking backward, hotels need strategies built for today’s highly competitive, digital-first environment. Open Pricing isn’t about reckless discounting or arbitrary rate hikes, it’s about using data-driven insights to optimize pricing in real time — it’s a fundamental shift in how revenue should be managed.
At Duetto, we continue to push the boundaries of revenue management, helping hotels harness the power of Open Pricing to drive sustainable, long-term profitability.
Want to learn more? Let’s talk about how Open Pricing can transform your revenue strategy.
