Rate parity's role in hotel revenue management
Himanka, Mia (2014)
Himanka, Mia
HAAGA-HELIA ammattikorkeakoulu
2014
All rights reserved
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2014121119507
https://urn.fi/URN:NBN:fi:amk-2014121119507
Tiivistelmä
Revenue management has gone through many changes during its existence. Especially after the emergence of the internet and the online distribution of hotel rooms, hotels needed to change their pricing practices. Rate parity was created as a result of these changes. Therefore the purpose of this thesis is to find out what kind of a role rate parity has in today’s and tomorrow’s revenue management in Finland.
In the beginning of this thesis an introduction to revenue management, pricing and online distribution of hotel rooms is given. Then the key topics that are the basis of this research are introduced. These topics include rate parity and the different players in the online distribution landscape such as online travel agencies and meta search engines.
The research was conducted with semi-structured expert interviews. The respondents who were interviewed are revenue management professionals with many years of experience in the field. All of the seven respondents were interviewed during October 2014. The inductive approach was chosen as the as there is a lack of existing literature on both rate parity’s role and the relationships between online travel agencies and hotels.
The results indicate that currently rate parity is in a big role in hotel revenue management in Finland. Managing rate parity can be challenging but there are also advantages. Rate parity is likely go through some changes in the future. On the other hand when the change will occur and the extent of the change is not clear.Furthermore the relationships between online travel agencies and hotels are good at the moment. Currently these two parties can collaborate in an equal manner. However online travel agencies were criticized for their extremely high commissions. It is likely that these relationships will continue to improve but this improvement won’t affect the agreements offered by the online travel agencies any time soon.
In the beginning of this thesis an introduction to revenue management, pricing and online distribution of hotel rooms is given. Then the key topics that are the basis of this research are introduced. These topics include rate parity and the different players in the online distribution landscape such as online travel agencies and meta search engines.
The research was conducted with semi-structured expert interviews. The respondents who were interviewed are revenue management professionals with many years of experience in the field. All of the seven respondents were interviewed during October 2014. The inductive approach was chosen as the as there is a lack of existing literature on both rate parity’s role and the relationships between online travel agencies and hotels.
The results indicate that currently rate parity is in a big role in hotel revenue management in Finland. Managing rate parity can be challenging but there are also advantages. Rate parity is likely go through some changes in the future. On the other hand when the change will occur and the extent of the change is not clear.Furthermore the relationships between online travel agencies and hotels are good at the moment. Currently these two parties can collaborate in an equal manner. However online travel agencies were criticized for their extremely high commissions. It is likely that these relationships will continue to improve but this improvement won’t affect the agreements offered by the online travel agencies any time soon.