Let’s talk about revenue management.
Our job as hoteliers: Fill the house, defend rate, drive revenue. It’s all we care about. It’s all we talk about. And since our goals are tied to these metrics, why would we care about anything else?
So we set rates aligned with our goals and move on. But as the booking window begins to close, we realize—yikes—we haven’t picked up and need to fill rooms. So what do we do? Drop rate.
But what message does this send? As Saul Gonzalez Ayala wisely pointed out in a recent Guest Editor article, this strategy inadvertently “teaches customers to wait.” It creates a trust deficit, punishing loyal guests who booked early and rewarding last-minute bargain hunters.
It’s time we shifted the conversation from our internal metrics to the guest’s perception of value. True value isn’t a number on a spreadsheet; it’s a feeling. It’s the guest knowing they made a smart choice.
What meaningful value looks like
The core principle is simple but powerful: Real value doesn’t have to be expensive for the hotel, but it has to feel meaningful to the guest.
Our industry is saturated with token gestures passed off as “perks.” Consider the difference:
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Weak value
A $10 discount on a $300 room. A coupon for 15% off a future stay that will never be used. A $30 credit toward a $180 spa treatment. These offers feel like marketing fluff because they are. They don’t significantly enhance the guest’s experience or their wallet. -
Meaningful value
A genuine early-bird offer that provides a substantial discount, like $100 off per night. A spa credit that covers the majority of a massage. A truly compelling non-refundable rate that offers a significant savings to make the commitment worthwhile.
Meaningful value makes the guest feel intelligent and rewarded. It confirms their decision to book with you was the right one, building the kind of trust that last-minute slashing of rates destroys.
The strategic payoff of putting the guest first
Adopting a value-first pricing strategy isn’t just about guest satisfaction; it’s a long-term revenue play. By rewarding early bookers with your best possible rate and holding firm, you achieve several business objectives:
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You train your guests
Guests learn that the best deal is secured by booking early and direct. This shifts demand forward, giving you a stronger base of occupancy to build upon over time. -
You build long-term loyalty
Rate integrity fosters trust. When guests know they won’t find a cheaper rate a week before arrival, they feel respected. This loyalty translates directly into repeat business and valuable direct bookings. -
You avoid last-minute panic discounting
With a solid base of early bookings, you’re less likely to panic and flood the market with low rates that devalue your brand.
By redefining value from the guest’s perspective, you create a more predictable, profitable, and sustainable business model built on a foundation of trust. And the best part? It allows you to stop chasing the market and start shaping it.
Thomas McDermott
Chief Marketing Officer
+1 954 975 2220
Tambourine
