How to Increase Your Hotel Occupancy Rate?
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The occupancy rate is considered a useful metric to determine the overall health of your hotel business. You can optimize revenue and profitability by maximizing the occupancy rate which helps you better understand the demand for your property.
If this figure is low, it may need to handle potential problems to change higher rate and boost revenue. In the competitive world, the more your hotel has a higher occupancy rate, the more your hotel can stay ahead of the competitors.
To truly understand how to increase your hotel occupancy rate, you have to clarify what the occupancy rate is and its calculation.
What is Occupancy Rate?
Definition of occupancy rate
Occupancy rate is the percentage of occupied rooms in a hotel during a specific period. You can track this rate over time. Your high occupancy rate indicates a large amount of booked rooms. However, some elements like seasons, economic and political conditions can influence your occupancy rate, leading to vary at certain times.
You can calculate your occupancy rate using this simple formula:
Occupancy rate = (Number of occupied rooms / Total number of available rooms) x 100.
Just to be clear, you can look at an example of the above formula:
If a hotel has 80 occupied rooms out of 100 available rooms.
(80/100) x 100 = 80 percent
The Top 5 Ways to Increase Your Occupancy Rate
Enhance your online presence and visibility
Utilize online travel agencies (OTAs) to reach a wider audience and increase bookings:
Online travel agencies (OTAs) allow travelers to search and book travel services such as hotels, car rentals, flights, or vacation packages. Some OTAs like Booking.com and Agoda can help your hotel increase occupancy rates and revenue. As they spend millions of dollars on advertising to enhance visibility and reach a wider audience, your hotel can leverage its large market to get new guests and drive more bookings. Partnering with OTAs will help your hotel optimize its pricing strategy and boost revenue thanks to their valuable data and insights into market trends.
Optimize your hotel’s website for search engines to improve online visibility:
When it comes to improving online visibility, search engine optimization is a must for your hotel’s website. If you want too many travelers to land on your website, you first need to identify relevant keywords that resonate with what your audience is looking for. Keyword research tools like Google Keyword Planner and SEMrush can provide valuable insights into search volume, competition, and related keywords.
Visual content can drive traffic to your website by up to 400%. The more traffic you have, the more likely your hotel generates more bookings. That’s why it’s so vital to improve the quality of images and stand out from other competitors by using Travelerwp.
JA Resorts & Hotels is a 5-star hotel brand that includes a series of hotels, resorts in Dubai, Maldives and Seychelles. You can find it on popular OTAs like Tripadvisor. With a better site structure and keyword-relevant content, this SEO strategy enhances online presence and generates more bookings. As a result, organic traffic takes off by 510%, revenue by 863%, and conversions by 1000%.
Implement effective pricing and revenue management strategies
Conduct market research to understand demand and competitor pricing:
Another effective way to improve occupancy rates for a hotel business is to research customer needs. It can provide insights into what your customers are ready to spend and what gets them to book a room. This information lay a foundation to adjust reasonable prices that entice your target audience. You can also determine which discounts or promotions to offer to generate bookings during the off-season.
Analyzing competitor pricing can help you pick out the average rate for your location and decide your room’s prices competitively. To compare rates, you can look for online travel agencies and competitors’ websites. In addition, demand, occupancy rates, and local events are something you should check out.
Utilize dynamic pricing to adjust rates based on demand and seasonality:
Simply put, dynamic pricing is setting prices for rooms depending on market demand. Consider whether it’s tourist season or off-peak season to charge different rates. For example, you can offer lower rates when demand is low during off-peak seasons. This way can help you avoid having empty rooms, reducing the chances of a financial loss. Similarly, choosing a regular price during the weekdays or a higher price for Saturdays and Sundays will attract more guests and maximize profit.
Winter is the peak tourist season in Miami. To avoid the crush of visitors, you can go during the low season, from July to October. There are a surprising number of deals and discounts found. The Betsy-South Beach, one of the boutique hotels in Miami offers 50 percent off Royal Suite bookings through October 31. What’s more, discounts across room categories are available, so a fourth night in any room category is free here through August 31.
Offer attractive packages and deals
Create enticing packages that cater to different guest preferences:
Ensure you’re introducing unbeatable packages to meet your customers’ preferences, enticing them to stay at your hotel for an extended period or to travel during the low season. For example, if you have an on-site pool or complimentary vouchers for the zoo and aquarium, add them for families who book a stay in advance. To attract romance-seeking guests visiting your hotel, an enticing package can provide a bouquet of flowers upon arrival and a free bottle of sparkling wine for a dining experience.
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Provide exclusive perks or value-added services to make your offerings more appealing:
Add-on exclusive perks or value-added services are a gateway to competitive advantage. You can offer free breakfast or luxury additional experiences such as a brewery tour with dinner and a tasting flight. Finding appropriate perks for your offerings can set your hotel apart from competitors and attract new guests.
Conveniently located next to Chadstone Mall with a bunch of boutiques, shops, entertainment, and dining options, Hotel Chadstone Melbourne MGallery, offers an exclusive shopping package including a $50 Chadstone – The Fashion Capital gift card to explore for guests who book a luxury Melbourne ‘Shopping Spree’ stay here. Additionally, the 5-start hotel has complimentary shuttle services to and from Melbourne CBD.
Implement targeted marketing and advertising campaigns
Identify your target audience and develop tailored marketing messages:
A great way to increase the occupancy rate is to define your target audience. To understand what motivates your customers to book a room and what they have in common, you need to consider your existing customer by using information from Google Analytics. This way can help form what your target audience looks like. Alternatively, feedback, reviews on social media, and surveys can be useful for identifying your target audience.
Make sure you’re creating marketing messages that align with the right customers. You have to generate what your potential customers care about. If your target audience is digital nomads, your content should focus on rooms with “Fast Wi-fi”. Doing so can keep your rooms occupied and remain revenue year-round.
Utilize digital marketing channels, such as social media and email marketing, to reach potential guests:
Advertising on marketing channels can help you attract more potential customers and drive new bookings. You can regularly post the hotel’s interior and exterior, live videos, and special offers on Facebook or Instagram to boost engagement. Moreover, creating paid campaigns to push your guests to book directly on your website is more profitable than online travel agencies.
Despite the allure of social media, email marketing is a powerful tool to boost hotel occupancy rates. By building an email list including potential customers to send out newsletters, promote special offers, add-ons, and discounts, you have a chance to get in touch with them and encourage them to book a room.
Hotel Plesnik, a family-run boutique hotel, uses Facebook ads to showcase outdoor activities and unique experiences. Highlight what adventure travelers can expect to make them stop scrolling and book a stay at this hotel.
Enhance guest satisfaction and loyalty
Provide exceptional customer service to ensure positive guest experiences:
If your hotel occupancy rate is low, invest in guest services. Hotels with positive experiences will always be on top of mind. Ensure your customer service responds quickly to guest questions and problems to impress guests and build genuine relationships with them. To have high-quality customer service, training staff to become friendly and understand guests’ needs will contribute to guest satisfaction and increase occupancy rate in the long run. Keep in mind to provide comfortable accommodations and various amenities like a spa, restaurant, and bar to cater to their preferences.
Implement loyalty programs to incentivize repeat bookings and referrals:
Focusing on existing customers is 5 times more cost-effective than trying to get new ones. The best practice is to request referrals from them such as sharing on social media, offering unique links or discount codes, and leaving positive reviews. In return, your hotel can give away gifts or discounts to show a win-win relationship. That’s why a loyalty program for people who have stayed at your hotel before can increase repeat bookings and improve customer retention.
H Hotels Collection created the H Hotels Club, a loyalty program with exclusive privileges for returning guests. By becoming a club member, you have free nights for your next stay. On top of that, there are different perks and exclusive benefits for club members such as having priority over check-in and à la carte restaurants, special club discounts on spa treatments, car rental, laundry, and any restaurants or bars.
Conclusion
A higher occupancy rate is the goal of your hotel as it determines how much revenue and profitability your hotel earns. On the other hand, low occupancy rates may be a sign of bad management. To improve your hotel’s occupancy rate, consider ways such as boosting online presence and visibility, performing effective pricing and revenue management strategies, creating attractive packages and deals, expanding targeted marketing and advertising campaigns, and focusing on guest satisfaction and loyalty. After reading this article, you can make better revenue management decisions to maximize your occupancy rates.
