RatePeak Suggested Rate Changes

The RateShepherd report includes Suggested Rate Changes that help hoteliers identify potential opportunities in the forecast. By looking for statistical outliers, we are able to let clients know where to look among the thousands of rates in their competitive forecast.

We do 3 keys things:

  • Trend every room type in the forecast
  • Compare the standard deviation of those room types against each day in the forecast
  • Determine if any room type does not follow the trend of the market competition.

RatePeak Example

The above example illustrates a simple two rate strategy. The formula has identified that the rest of the market increased on 1/4 and did not increase on 1/7. The formula makes its determination based on the existing yield strategy, so our recommendation will closely reflect the general yield strategy used in the forecast. Because $139 is the high rate seen in the forecast and the competition have all gone to their highest rate, we recommend the standard room be increased by the usual margin. The inverse is true on 1/7 and so we recommend the rate be decreased.

Because our recommendation is based on regression analysis the suggested rate is a reflection of the general trend we see in the market as it compares to your pricing. It will not always be exactly the rate you want to yield, but we look at it as an indicator that the hotelier should evaluate that room type on that day, identifying the direction the competitive set is moving (and by how much).

Some reasons the suggestions may be ignored:

  • Protecting group rates
  • Protecting for an event or holiday
  • Competitors that aren’t primary or secondary
  • Competitors that are protecting a group rate

With all of that, we are more than happy to answer any questions via email or setup a web meeting to discuss any questions you may have.