To apply revenue management in a hotel there are a few basic priciples that apply. What are these basic requirements to be able to successfully yield and optimize revenue and profit of a hotel as a revenue manager or hotelier?
Here is an overview of the basic elements and ingredients you need to apply hotel revenue management effectively:
  • Market Segmentation
  • Historical Demand and Booking Patterns
  • Demand Forecast and Displacement Analysis
  • Pricing and Inventory Management
  • Overbooking
  • Information Systems
In the following section of this revenue management book or manual will go into more detail on these topics or concepts.


With regard to overbooking, it is simply necessary to oversell to reach 100% occupancy, without walking away clients. If there is a risk of walking away, the costs should be taken into account in the evaluation of the overselling (extra rooms revenue sold versus the costs of walking away or out-booking)