SAN ANTONIO, Texas and ALPHARETTA, Georgia—Agilysys, Inc. released the findings of its 2024 Global Hospitality Impact Study: Unlocking Revenue Beyond the Room at The Hospitality Show 2024. This survey of 489 hospitality executives and technology decision-makers across North America, Europe, and APAC unveils insights into the industry’s readiness to embrace revenue per available guest (RevPAG) strategies while highlighting challenges holding back adoption.
The potential of adding RevPAG initiatives to traditional revenue per available room (RevPAR) measures is reflected in the current trend of travelers seeking personalized experiences, with luxury properties already generating up to 40 percent of revenue from non-room sources. However, while 82 percent of hospitality executives are interested in proactively identifying and expanding revenue opportunities at the per-guest level, 56 percent believe they are unprepared technologically and operationally to do so.
“Properties have a compelling opportunity to lean into growing traveler desires to receive personalized offers and enjoy unique experiences curated just for them. However, technology equipped to identify and serve up these opportunities—whether in advance or real-time during a guest’s stay—is not pervasive,” said Terrie O’Hanlon, senior vice president, Agilysys.
“While there is overwhelming interest in capitalizing on RevPAG’s potential to drive both revenue growth and guest loyalty, our research reveals a concerning readiness gap,” O’Hanlon continued. “Properties that fail to bridge this gap not only risk leaving substantial revenue on the table in a promising and expanding market but also increase the probability they will fall behind new properties and others investing in technology, operating processes, and cultural dynamics geared toward understanding revenue potential at the per-guest level.”
Findings from the report include:
- Critical Aspiration-Reality Gap: While 82 percent of hospitality executives recognize the potential of optimizing RevPAG, 56 percent feel unprepared to do so.
- Technology Transformation Considerations: To enable optimizing RevPAG, 72 percent of executives are willing to enhance the current technology infrastructure, with two-thirds willing to consider switching PMS systems, providers, or both.
- Technology Review Gap: Only 12 percent of properties review their system capabilities against market innovations multiple times yearly, while 38 percent wait four or more years between doing so, contributing to blind spots concerning leveraging new technology to optimize revenue at the per-guest level.
- Dual Role of Technology: Sixty-eight percent of executives believe property technology must balance day-to-day operations with future innovation needs.
- Priority Inertia: Most properties have traditional priorities at the head of their day-to-day operating mandates as opposed to having made a shift to putting the ability to identify and optimize per-guest revenue first. While “enhancing guest experiences” is the leading priority at 68 percent, doing so is not specifically revenue-per-guest focused. Acquiring new guests (67 percent) and increasing rebookings (63 percent) round out the top priorities. While it is true that these advantages can result from optimizing per-guest revenue, cultures have not evolved to make RevPAG a property-wide focus even though there is high agreement (82 percent) about the value of doing so.
The 2024 Global Hospitality Impact Study highlights the advantages of expanding room-revenue-focused mindsets shaped by RevPAR and average daily rate (ADR) metrics to broader, guest-centric revenue sensibilities. Adding RevPAG goals and capabilities to traditional performance expectations equips properties to capture the full spectrum of guest spending and the added revenue upside derived by tailoring offerings to individual guest desires.
“The path to ‘High Return Hospitality’—a state in which financial and emotional returns are optimized by perfectly aligning individual guest desires with property offerings and staff capabilities—becomes easier when hospitality executives broaden how they measure and create value,” said O’Hanlon. “RevPAG is not just another metric—it is a reimagining of how properties and brands relate to each guest and monetize the moments that matter most. Properties that undertake this transition will set new standards for delivering personal, profitable guest experiences and for elevating operating advantages.”
Appeared first on: lodgingmagazine.com