How Hotel DC Safeguards Against Revenue Loss with Dynamic Pricing

In the world of hospitality, adapting to changes and making smart pricing decisions can be the difference between success and stagnation. That’s where Preno’s Dynamic Pricing tool comes into play. We’ve seen it in action with Hotel DC, a customer who has used this tool to enhance their revenue generation.

Hotel DC, is a stunning boutique hotel that’s nestled within a charmingly refurbished Victorian landmark building. Situated just minutes away from the bustling Stratford area of London, Hotel DC serves as the perfect base for both leisure and business travellers.

Just two weeks ago, Hotel DC integrated Preno’s Dynamic Pricing tool into their operations. Since then, it’s made a whopping 806 adjustments to their pricing strategy. The result? An impressive average increase of £15 was generated per booking.

We spoke with Surjan Singh, owner and operator of Hotel DC, to ask him about his experience with Preno’s Dynamic Pricing tool. Reflecting on his previous pricing strategies, he said, “So the rates that we were managing—a small hotelier like me could only manage rates one day, two days, maybe up to a week in advance. Once in a while, you get a Saturday peak and you think I might bump it a bit or something. But in reality, you have no way of comprehensively managing anything more than a week.” He explained how this reactive approach, constantly monitoring and making minor adjustments, wasn’t feasible for comprehensive, long-term planning.

The frustrations of the way they previously managed pricing were clear. “By the time you try to manage it, it’s already full anyway. You’re way too slow to react for the future.” But with Preno’s tool, they’ve seen a significant shift.

“The biggest difference is the only management realistically you could do before this tool was in the very short term. And now… there’s a massive safeguard against spikes going forward.”

In the world of hospitality, it’s not only about managing rates but also about adapting quickly to unexpected events. Reflecting on a previous experience, Surjan shared, “You never know when an event is going to come out.” He cites an instance when the popular band, Foo Fighters, announced a concert at West Ham Stadium. “Everyone booked out for everything, including us, and we couldn’t react to the tour.”

This event led to a surge of bookings for which they lost potential revenue, highlighting one of the many challenges of responding to sudden demand spikes in real-time manually. “By the time we tried to react, it was already too late,” he explained.

“But if surge pricing had been in place at that time, there would have been an interaction on the same day,” adjusting their rates and avoiding the missed opportunity.

Dynamic pricing is more than just a tool for revenue optimisation; it also instils confidence in the decision-making process. One of the compelling instances shared by Surjan touched upon the scenario of last-minute room pricing. “When rooms are likely to remain vacant as the night approaches its end, we want to offer them at a lower rate. Often, depending on how confident our receptionist is, they might call me and ask, ‘Should we do this? Or should we do that?'”

Using dynamic pricing has provided a valuable framework for making such decisions with more assurance. “The great thing about dynamic pricing is that even if a receptionist notices that we’re getting busier, they wouldn’t necessarily know how much to increase the price. Having these (Dynamic Pricing) rules in place is incredibly helpful.” This rule-based approach to pricing provides a structure that empowers staff to make informed decisions without hesitation. It eliminates the guesswork and uncertainty, improving operational efficiency.

Hotel DC and Surjan Singh have achieved incredible success by seamlessly integrating Preno’s Dynamic Pricing tool into their operations. This has led to higher revenue and time savings, not just by making rate adjustments easier, but also by speeding up decision-making. By using this tool, they can confidently protect against market changes and unforeseen events that could affect their revenue. Dynamic Pricing helps them stay ahead of the competition, ensuring informed decisions and the best rates for each customer.