Choosing the right rate shopping tool

It's getting harder to figure out how to manage revenue these days, and it's not just because of the pandemic.

Markets are less predictable. Competition is now more intense than ever among both the traditional players and newer ones like short-term rentals and Airbnb. On top of that, booking windows are shorter and travelers place a new value on experiences.

This makes properly pricing rooms more difficult even for experienced revenue managers.

At the same time, it’s more important than ever to be competitive yet price in a way that maximizes the topline.

To accomplish this, you must know exactly what your competitors are doing and what’s happening on your various distribution channels.

Given today’s dynamic markets and wealth of data, the only way to always have the answers is to use a rate shopping tool.

What is a hotel rate shopper?

A hotel rate shopper is an analysis tool that automates data collection and shows how your rates compare to competitors.

Using a rate shopper brings you four key benefits:

1. The tools to implement the right strategy at the right time to maximize profitability: knowing how your hotel fits into your market’s competitive landscape helps you make informed, effective pricing decisions that will help you seize more revenue opportunities.

2. A complete overview of your market and your competition: a rate shopper presents data in a clear, concise format, instead of an unwieldy Excel sheet. This gives you a complete picture of your market’s latest developments.

3. Agility so you can be ahead of the pack: get directly into the analysis and decision-making process without losing time on collecting and collating data. That way you identify and react to demand changes before your competitors.

4. Saved time on data collection: since the tool gathers data for you, you no longer have to do it manually. On top of that, leading products bring together all critical hotel and short-rental rental data into one platform, so you only need to check a single dashboard.

In short, rate shoppers help you better understand your competitors, spot market trends early on and maximize your revenue throughout the year.

Given all the benefits, you’re probably sold on getting a rate shopper. There’s only one more challenge: picking the right one from the huge selection.

Go through the points in the next section to ensure you’re choosing the best solution for your hotel.

Key boxes your hotel rate shopper should check

While researching, analyze how each option measures up in the following six areas.

1) Data quality, quantity and diversity

The goal of using a rate shopper is to provide you with more and higher quality data than you could collect manually. Since no good decisions can come from second-rate data, these points should be the top priority.

• Continuous access to live data

Many rate shoppers still only offer market snapshots once a day, usually in the morning. Others throw in one refresh after lunch. But that doesn’t cut it in today’s dynamic markets.

That’s why Rate Insight offers you constant access to live data, no matter what time of day you check the system.

• Broad data sets covering the whole market

When thinking about rate shopping, gathering compset and OTA data usually comes to mind first. The best tools don’t stop there though. They also pull short-term rental information to give you a full picture of demand and rate evolution in your market.

Rate Insight, for example, displays all this data in a single interface, to offer a complete overview and allow you to adjust your strategy ahead of the competition.

• High-quality, accurate information

Even vast amounts of data won’t help you make better decisions if the information is inaccurate.

Rate Insight uses advanced anomaly detection and automated integrity control to ensure you get access to the most accurate, complete and reliable data.

2) Advanced market monitoring

Always know where your hotel stands in the market, where your rooms are selling and if all partners are playing by the rules. The right rate shopper has the following capabilities to help you do that easily.

• Shopping across distribution channels

It’s impossible to manually monitor the countless channels you’re selling on. Get a rate shopper like Rate Insight that offers unparalleled global connectivity and pulls data from OTAs and GDS of all sizes and niches. That includes accessing regional channels, e.g. Ctrip in China and Rakuten in Japan. And don’t forget short-term rental sites like Airbnb. They’re major market players and only by including them, you can get a complete picture.

• Parity checks

Losing money due to rate disparity cases is unnecessary and avoidable. Unfortunately, if there is a case, guests can spot it quickly via metasearch sites. With Rate Insight it’s easy to maintain parity. The tool highlights which partners are undercutting you, so you can act immediately.

3) Precise rate comparison

The goal of gathering competitor rates is to see if your hotel is positioned optimally and understand Comp Set strategies so you can make appropriate pricing decisions.

The only way you can do this properly is with a rate shopper that lets you get granular with your comparisons. Here’s what you need for that.

• Refined mapping

It’s critical to compare apples to apples when evaluating competitor prices. For that, you must:

1. Compare the right room types: map the categories that are true equivalents regardless of the names your Comp Set is using. Unfortunately, many rate shoppers aren’t very flexible here.

2. Consider rate parameters: LOS restrictions, inclusions (e.g. breakfast, airport pick-up…), meal plans and the room type all factor into a rate. Your rate shopper should be smart enough to account for that.

Rate Insight covers all these bases to help you identify the long-term pricing and promotional strategies your competitors use. This will make it easier to adjust your offering accordingly.

• Length of stay comparison

Comparing rates for one-night stays is a good start. But many rate shoppers stop there.

For a better picture, gather data from your Comp Set for multiple stay lengths via Rate Insight. This reveals their LOS strategies, e.g. long-stay offers during low season or minimum LOS during big events. Knowing this allows you to offer the right deals and attract more business.

• Tracking rate evolution

Do this if you want to see your Comp Set’s rate strategy and how they’re doing for a specific date or date range. Analyze their pricing throughout the booking window to find out if they’re winning business or not. For the best insight, connect your OTB data to see how rate changes impact your own booking pace.

• Flexible Comp Sets

Markets change quickly today and your Comp Set might not be the same year-round. Despite that, many rate shoppers make you pick a fixed Comp Set and will charge you to add or change properties.

But the chance to update your Comp Set whenever necessary, e.g. by season, proximity or aspired competitors, is exactly the flexibility you need today.

Rate Insight offers that plus the bonus of adding short-term rentals to your Comp Set.

4) Access and integrations

Silos are still a big problem in our industry. With the right tech tools you can break them down to foster communication and collaboration across commercial departments. That leads to more effective promotions, increased sales and boosted revenue.

• Logins for all commercial teams

Yes, rate shoppers are primarily interesting for the revenue team. But when source market data and booking trends are involved, sales and marketing also benefit from the latest information.

Since Rate Insight makes this information available in a clear, easy-to-read format, it’s a valuable resource for all commercial teams. Share access with them, so you can devise winning strategies together.

• Integration with other revenue tools

Even the best tool only offers limited benefits if it works as an island. But that’s what many rate shoppers do. As a result, you still need to extract their data, format reports and manually load them into other systems, e.g. your RMS.

Not so with Rate Insight. It integrates with many other revenue solutions at no extra cost and in just a few clicks. This ensures data flows freely to where it’s needed, and your team can focus on tactics and strategies.

5) Multi-property functionality

Even the best tool only offers limited benefits if it works as an island. But that’s what many rate shoppers do. As a result, you still need to extract their data, format reports and manually load them into other systems, e.g. your RMS.

Not so with Rate Insight. It integrates with many other revenue solutions at no extra cost and in just a few clicks. This ensures data flows freely to where it’s needed, and your team can focus on tactics and strategies.

6) Customer support

Even with the best tech tool, you’ll have questions or need assistance every so often.

Getting quick, helpful responses from your tech provider is essential, especially because revenue management is time-sensitive and waiting for a reply can cost you bookings. Lukas Peter, Global Head of Revenue at Soho House & Co knows that Lighthouse’s team has his back:

“The customer support has been fantastic from the get-go and their response time is extremely fast. That sets Lighthouse apart from other vendors. Customer support has even reached out to us proactively when they detected an issue with data integration. We quickly took the needed actions and were able to avoid any downtime or delays.”

Summary

While all rate shoppers promise access to reliable, current information, many don’t offer the invaluable live shops or real-time competitor insights you need to make the best decisions. So keep your eyes open for that during your research.

And don’t forget to check whether your new tool also includes short-term rental data and parity insights. These points round out the picture of your market and distribution landscape, so you can always act quickly and seize every revenue opportunity.

If you want the one tool that covers all of these bases, check out Rate Insight now.