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PREPARING SOUTH AFRICA FOR THE WORLD |
IDeaS Revenue Optimization has released its list of 'winning revenue management strategies' for the 2010 World Cup. The company analysed the 2006 World Cup in Germany and the 2008 UEFA Championship in Austria and Switzerland. The research focused on levels of occupancy, the optimal rates charged and the other streams of revenue. The data was then formulated in a manner which was able to provide a clear picture of the effects different matches had on individual cities. Paul van Meerendonk, senior consultant for IDeaS, spoke to Project 2010 about the findings...  You have just released your list of winning revenue strategies for the 2010 World Cup. What is the idea behind this initiative? Unique events like the World Cup are often clouded in mystery for hotels in host cities. Because these events only happen once in decennia (or longer) in the same country, hotels do not have the data or experience in order to be fully prepared for the changed demand patterns during the event. Our objective was to collect and analyse data from previous events, to give hotels a better insight as to what may happen in South Africa in 2010, and to provide recommendations and strategies to optimise revenues. Our overall goal is to raise the level of Revenue Management understanding amongst hoteliers, and this event provided the necessary basis to get people focused on the importance and relevance of Revenue Management. What were the most significant findings? Strategies amongst hotels in Germany varied, and there is no clear strategy that proved consistently successful. A mixture of strategies proved to be the best approach. Occupancies and demand were high during matches, but were significantly lower on non-match days. This extent of this was much more significant than what many hoteliers expected. High profile matches did not guarantee full occupancy. Food and Beverage revenues were generally lower on non-match days than during the non-event period. In your view, are South African hoteliers equipped to handle the influx of so many people for one event? Unfortunately there have not been many large events of the scope of the World Cup in South Africa, so this is difficult to judge. In our research we have also focused mainly on the revenue management aspects of handling the demand, and not the operational aspects. In terms of Revenue Management, we had a large attendance to our webinar on this subject - which shows that hotels are actively working on their revenue management strategies for the event well in advance. In terms of accommodation, what are the biggest lessons South Africa can draw from the host of previous World Cup tournaments - particulary Germany (2006) and Japan/South Korea (2002)? Hoteliers need to be careful not to be overly ambitious and expect sold-out situations during every match or for the entire length of the tournament. They should also apply a mix of strategies and tactics - including a balanced business mix combining groups and transient. They should focus on business with varying lengths of stay, with longer stay business preferable to fill in non-match days. And they should take care to ensure they not only focus their efforts on match days, but most importantly the surrounding days to maximise revenues across the entire event. more interviews... |
