Determinants of successful revenue management

Abstract

Purpose The aim of this paper is to define which characteristics of a hotel and staff organization determine successful revenue management (RM) implementation in urban hotels. Design/methodology/approach Multiple linear regression analysis was used to determine whether the characteristics of the hotel and the staff member in charge of RM are explanatory variables for the degree of RM implementation. Findings The findings show that hotel category, chain affiliation and the existence of qualified full-time staff are the determinants for successful RM implementation. The creation of the revenue manager position alone is not determinant in the degree of RM implementation, but his/her qualification and dedication are fundamental variables. Research limitations/implications Given that this survey was confined to the region of Madrid, it would be interesting to carry out similar research nationwide. Practical implications This study provides researchers and professionals guidance for the satisfactory implementation and use of RM, tailored to the characteristics of any given establishment. Therefore, this paper states that the creation of a qualified, on-site, full-time revenue manager position is crucial. Originality/value To the best of the authors’ knowledge, this is the first paper to conduct a formal statistical analysis of the relationship between hotel characteristics, staff organization and the degree of RM implementation. The greatest contribution of this research is the empirical demonstration that having a qualified full-time staff in charge of RM leads to better results in terms of RM implementation as opposed to not having one, having one part-time or having one at the corporate level. Therefore, this paper states that the creation of the professional revenue manager position within hotels is fundamental. Thus, the reported results provide a significant contribution to the literature related to the characteristics and organization of RM in hotels.