Are you curious to know ways for Revenue management post-COVID-19?
Then you are not alone.
Travel and tourism are suddenly facing a huge fall in demand.
Firstly by the COVID-19 outbreak and later by the ban on travel by Government.
As the exceptional consequence of the COVID-19 crisis unfold the established way of the travel industry to manage revenue will not work.
Even the established companies have to reset their practices of revenue management post-COVID-19 to survive this pandemic and to succeed in the future beyond it.
Before looking at the ways of Revenue management post-COVID-19, first, understand revenue management.
What is Revenue Management?
It involves the use of performance data and analytics, by the revenue management team to accurately predict demand and other consumer behavior.
Thus, it helps them to decide on pricing and distribution to maximize revenue.
The main aim of revenue management is to sell the right product to the right customer for the right price at the right time.
Following are the ways of Revenue Management post-COVID-19-:
Forecast short term needs
Several times, the price cut is the solution to stimulate demand. But low prices do not boost sales in the current circumstances.
Earlier with the use of historical price elasticities, research management teams make predictions. But in this pandemic situation, these data will not help.
With the help of these steps, the company can address this issue in the short term-:
- Prepare your staff to give advice and support to guests, when they contact to know procedures for cancellation and re-book reservations. It helps to build customer’s confidence in your brand.
- Companies have to make pricing policies according to the current situation. Don’t devalue your product as it is not possible in this situation to gain market share by impulsively decreasing prices.
This way the company can return to the market post-COVID-19.
Stakeholders are those who directly or indirectly affect the success of your business.
It includes customers, suppliers, government, shareholders, employees, and the local community.
Efficient communication with stakeholders should take place regularly to stay in touch with them.
Make your working team priority as a human resource is the company’s most valuable asset.
Arrange work from home setting for administrative staff.
It safeguards their health without a pause at work. Keep communication lines open with the staff when they work from home. Hold regular meetings.
Those staff who can’t work from home during the COVID-19 outbreak, create shift hours for them with some time interval between shifts.
The time gap between two shift hours must be enough to reduce the person to person contact.
Besides, staff should also follow some safety measures like handwashing, avoiding skin contact, if possible then wear gloves while working.
The participation of shareholders at every point is necessary to ensure that crisis management has the best chance of positive outcomes.
Chart out a good plan for your business before investing funds of shareholders.
Estimate future demand
Due to the COVID-19 crisis, most of the historical demand patterns are no longer valid.
The business can no longer depend on them. But companies need to form new processes to estimate demand post-COVID-19.
Countries for estimating demand take cues from other nations or states that are days or weeks forward in the COVID-19 curve.
The companies that operate across different nations can take hints from their demand trend in different locations.
Others can take hints from market research data from different places. And plan a business decision accordingly.
Revenue management teams must predict an early indication of customer demand.
They must gather information from social media, price charge by competitors, look to book ratios, etc.
Analyzing real-time information
It is crucial post-COVID-19 to analyze the flights which operate on cash loss in the next few months.
The revenue management team must find out data regarding restrictions impose on flights, losses flights bear, etc.
This helps to ensure a minimum amount of cash reserves are there.
Thus, flights can resume its operations.
Analytics also helps to predict the bookings and cancellations in real-time by the market.
The decision must be taken faster by teams post COVID-19. To make the decision faster companies must use the real-time dashboard.
Everyone in the company at all levels makes sure to use it. As a result, real-time information flows to decision-makers.
Keeping regular meetings in all the departments helps the company to act faster.
Strategy for promotion and pricing
Update your pricing points and also re-establish your quality and marketing plan to re-engage with customers.
As when the recovery phase starts promotion strategy plays an important role in the performance of the company.
Giving discounts on ticket prices will only lead to a short term boost in sales. But eventually, it causes loss to the company in the long run.
Different segments of the market must be taken care of for making promotions and pricing strategies.
Re-assure your travelers that their safety is the topmost priority of the company.
Ensure proper cleaning and sanitizing before and after on-boarding.
Hand sanitizers and disinfectant wipes must be available for each passenger.
Disinfect the airport, flight, busses, gate areas and inform this to your customers.
Make some special or personalize offers to your premium customers like offer upgrade to business class.
Provide specials on flight points to help raise competition to help preserve market price credibility.
Thus all these help maintain and earn the status of the company.
From above we can conclude that revenue management teams must start taking steps as early as possible after analyzing the data.
And implement new tools and strategies with ease into their working.
Revenue management post-COVID-19 includes a forecast of short term needs of customers, maintaining efficient communication with stakeholders.
The team must estimate future demand by taking cues from other nations.
Also, making promotions and pricing strategies with the help of real-time information is crucial for surviving this pandemic.
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